--Thomas Friedman
1A did jan 13 2016
1A did jan 13 2016
 Developed countries have a relatively high per capita GDP
 Less-developed countries have a relatively low per capital
GDP
 GDP (gross domestic product) is the total market value of all
final goods and services produced annually in a country
 Per capita GDP is GDP divided by the population
 Rapid Population Growth
 Low Savings rate
 Cultural Differences
 Political Instability and Government Seizure of Private Property
 High Tax Rates
 Population growth rate is the birthrate minus the death rate
 Population growth rate is typically higher in less-developed
countries which have:
 Higher birthrates due to an economy that revolves around
agriculture and no financial assistance for the elderly (like Social
Security) so parents need children to care for them in old age
 A declining death rate due to medical advances
 Banks get the money they loan from people who have savings
accounts at the bank
 Less-developed countries have low savings rates because the
people are too poor to save
 They can only afford the necessities of life
 Thus, banks can not make loans for capital investments
 Farmers can’t buy tractors
 Businesses can’t improve their technology
 Less-developed countries are poor because they cannot save
 Without savings they cannot buy capital goods
 But they cannot save and buy capital goods because they are
poor
 Little to no government debt
 Low taxes invite immigrants
 Increase in productivity
 Low tariffs encourage trade
 International trade agreements can lead to international prosperity
and peaceful relationships
 North American Free Trade Agreement,
NAFTA
 eliminated trade barriers between US, Canada, and
Mexico
 signed by President Bill Clinton in 1994
 the overall value of intra-North American trade has
more than tripled since the agreement's inception
EOC study guide
Globalization #5
 European Union, EU
 over 28 member nations
 creates free-trade zones that reduce or
eliminate trade barriers
 created a single currency
EOC study guide
Globalization #6
 World Trade Organization, WTO
 negotiates new trade agreements
 resolves trade disputes
 From 1930-1995 the average tariff in the US
dropped from 59% to 5%
EOC study guide
Globalization #8
World Trade Organization, WTO
 Arguments against the WTO
 prioritizes trade and commercial
considerations over all other values
 refuses to ban imports of goods made
with child labor
 hurts the Third World
 World Bank
 International Monetary Fund (IMF)
Part of the
United Nations
Created 1944
188 member
countries
Headquarters
in Washington,
DC
EOC study guide
Globalization #9
 Aims to reduce poverty in middle-income
and poorer countries
 Provide low-interest loans and grants for
 Education
 Health
 Infrastructure
 Agriculture
Part of the
United Nations
Created 1944
188 member
countries
 Purpose is to promote the health of the world
economy
 How?
 Maintain an orderly system of payments and
receipts between nations
 Ensure the stability of exchange rates
 Facilitate international trade
EOC study guide
Globalization #7 cont
 Tri-fold a piece of construction paper, so there is a “page” for:
1. Brochure title—including a venn diagram of the organizations
2. NAFTA
3. EU
4. IMF
5. WTO
6. World Bank
 Under each organization explain:
 Who (which countries) is in this organization?
 What is the purpose or goal (vision/mission) of the organization?
 How does the organization achieve its goal/purpose?
 What are some of the organizations successes?