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Global Politics III & IV > Pathways to Economic Development > Flashcards

Flashcards in Pathways to Economic Development Deck (18)
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1
Q

What is the ISI?

A

Import Substitution Industrialization

2
Q

What is the main purpose of the ISI?

A

To build industrial capacities within a country, rather than importing a product

3
Q

Why was the ISI created?

A
  • Due to the need of autonomy & domestic pressures
  • For protection against multinational corporations
  • To protect infant industries
  • To seek diversification of production
4
Q

How do states play a big role within ISI?

A
  • By deciding which goods should be produced
  • By allocating subsidies
  • By instituting other trade barriers
5
Q

Which are some drawbacks for ISI?

A
  • Protecting inefficient industries
  • Indiscriminate protectionism
  • Competitive protectionism
6
Q

Which is a need of the ISI?

A

International loans

7
Q

In the terms “Washington Consensus,” what is understood by the term “Washington”?

A
  • US Congress
  • The Fed
  • The US Executive
  • Think Tanks
  • Financial institutions
8
Q

Which are the 10 articles of the Washington Consensus?

A
  1. Fiscal deficit
  2. Public expenditure priorities
  3. Tax reform
  4. Interest rates
  5. Exchange rates
  6. Trade policy
  7. Foreign direct investment
  8. Privatization
  9. Deregulation
  10. Property rights
9
Q

In the Washington Consensus, what is understood by 1. Fiscal deficit?

A

Government must reduce deficit

10
Q

In the Washington Consensus, what is understood by 2. Public expenditure priorities?

A

Cutting off unnecessary subsidies & increasing investment in human capital & building infrastructure

11
Q

In the Washington Consensus, what is understood by 3. Tax reform?

A

Keeping taxes low & building a broad tax base

12
Q

In the Washington Consensus, what is understood by 4. Interest rates?

A

Market-determined, positive rates that encourage savings

13
Q

In the Washington Consensus, what is understood by 5. Exchange rates?

A

Value of a currency in comparison to another currency

14
Q

In the Washington Consensus, what is understood by 6. Trade policy?

A

Liberalizing imports

15
Q

In the Washington Consensus, what is understood by 7. Foreign direct investment?

A

Dismantling of barriers so as to import skills, know-how & capital

16
Q

In the Washington Consensus, what is understood by 8. Privatization?

A

Relieving pressures on government budget & mitigating moral hazard

17
Q

In the Washington Consensus, what is understood by 9. Deregulation?

A

Eliminate / reduce the amount of rules surrounding economic activities

18
Q

In the Washington Consensus, what is understood by 10. Property rights?

A

Providing certainty for economic activity & encouraging wealth accumulation & investment