Transcript INTERNATIONAL TRADE

Unit 7 -TRADE
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International Trade Vocabulary
Free Trade
Trade Barriers
Trade Agreements
Global Developments
United Nations
Human Rights
INTERNATIONAL TRADE
VOCABULARY
• Import – a product purchased from another country.
• Export – a product sold to another country.
• Global interdependence – idea that countries of the world are
growing increasingly dependent on one another.
• Comparative advantage – ability of one country to produce a
product at a lower opportunity cost than another country.
• Favorable balance of trade – a country exports more than
they import. Foreign trade is profitable to the nation.
• Unfavorable balance of trade – a country imports more than
they export. Foreign trade loses money for the nation.
FREE TRADE
Arguments For Free Trade
1.
Increased competition = improved products.
2.
Trade restrictions damage export industries.
3.
Specialization and comparative advantage lowers prices.
4.
Greater political cooperation.
TRADE BARRIERS
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Protectionism – idea that
country should impose
barriers to international
trade in order to protect
domestic industries.
Arguments Against Free Trade
1.
Job security is threatened.
2.
Protection of nation’s
economic security is needed.
3.
Protection of infant
industries is needed.
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Trade Barriers
Tariff (protective, revenue)
Quota – a limit on the value or
number of products to be
brought in from another
country
Embargo – a refusal to trade
with another country.
Trade Cartel – a group of
nations band together to
control the supply & price of a
product. (OPEC)
OPEC COUNTRIES
TRADE AGREEMENTS
• NAFTA – North American Free Trade Agreement (US,
Canada, Mexico)
• CAFTA – Central American Free Trade Agreement (US,
Central American Countries
• WTO – World trade Organization – app. 150 nations seeking
to increase trade and limit trade barriers.
• EU – European Union – 27 European countries have created a
single economic entity.
Global Developments
Protectionism – idea that a country wants to prevent free trade
to safeguard the jobs, and the overall economy.
Developed Country – a country which is highly industrialized,
with high levels of technology, and a large middle class.
Developing Country – a country which is transitioning from a
more traditional economy to an industrialized nation. There
are various levels of developing nations.
Arguments for Supporting Development
1) Higher per capita GDP.
2) Opens markets to sell goods and services.
3) Promotes democracy.
Issues for Supporting Development
1) Environmental protection.
2) Protection of Domestic Jobs.
United Nations
• Internationalism – nations should cooperate to promote
common aims, such as supporting economic development and
fighting terrorism.
Goals of the United Nations
• Promote peace
• Provide aid to nations
• Promote & Protect Democratic Elections
• Prevent Violence
• Provide aid to Refugees
Globalization
• Interdependence and interaction among individuals and
nations working across barriers of distance, culture, and
technology.
Global Issues
1) Environmental Destruction
2) Economic Inequality
Human Rights
Declaration of Human Rights
Protection of Rights
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Similar to US Bill of Rights
Additions – freedom of movement, right to asylum, right to
nationality, right marry/family, own property
Raising Standards of Living
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Includes - right to security, right to work, equal pay for
equal work, right to form and join trade unions.
Additions – standard of living acceptable for health and wellbeing, right to education
Human Rights Violations
Genocide – deliberate killing of members of a racial or
cultural group. (Nazi Germany, Rwanda)
Apartheid – separating people based on race or
ethnicity. (South Africa, Similar Issues in Southern
United States – Jim Crow Laws)