International Relations Study Guide

International Relations Study Guide - Pols 231 Final Study...

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Pols 231 – Final Study Guide/ Book Notes 1. Following the end of WWII, the US and many other countries established a set of rules and institutions to guide international economic relations. What were the rules and institutions that composed this so-called “liberal international economic regime”? Why did the US believe that it was necessary to create them? Economic Nationalism : protectionism, speculation, regulations. Promote globalization rather than economic nationalism. Mercantilism: 17 th Century theory preaching that trading states should increase their wealth and power by expanding exports and protecting their domestic economy from imports. Great Depression : Commercial liberalism : An economic theory advocating free markets and the removal of barriers to the flow of trade and capital. Introduced at Bretton Woods. Concentrated wealth in west. Preference for liberalism. US Leadership. Protectionism/Free Trade : Policy creating barriers to foreign trade, such as tariffs and quotas, that protect local industries from competition. Tariff : taxes imposed by gov on imports Non-Tariff Barrier to Trade: When gov regulates foreign industry with rules. Most Favored Nation Principle: Non-discrimination in trade. Comparative Advantage: Concept in liberal economic theory that a state will benefit if it specializes in those goods it can produce comparatively cheaply and acquires through trade goods that it can only produce at a higher cost. Fixed Exchange Rates: A system under which states establish the parity of their currencies and commit to keeping fluctuations in the exchange rates within narrow limits. Currency Speculation: Make a profit off currency GATT/WTO: GATT: Principal organization designed to promote and protect free trade in the aftermath of WWII. Commercial Treaty. Legalistic wrangling. Superseded by WTO. Breathtaking step in free-trade management. Extends GATT's coverage to products, sectors,
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International Relations Study Guide - Pols 231 Final Study...

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