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02 Worksheet 1 TCW

Economic globalization refers to the growing interconnectedness of economies through cross-border movement of goods, services, and capital. While globalization is not new, having occurred throughout history, countries can converge by becoming increasingly similar or diverge through growing differences in areas like culture, policy, and economy. International monetary systems govern currency exchange between countries, with early systems including the gold standard and Bretton Woods system linking currencies to gold or the US dollar. European monetary integration led to a common market and currency in the Eurozone to reduce dollar dominance and increase economic cooperation. International trade policies govern trade agreements between nations, while unilateral trade orders only benefit the imposing country without input from others.

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Jericho Fajardo
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251 views2 pages

02 Worksheet 1 TCW

Economic globalization refers to the growing interconnectedness of economies through cross-border movement of goods, services, and capital. While globalization is not new, having occurred throughout history, countries can converge by becoming increasingly similar or diverge through growing differences in areas like culture, policy, and economy. International monetary systems govern currency exchange between countries, with early systems including the gold standard and Bretton Woods system linking currencies to gold or the US dollar. European monetary integration led to a common market and currency in the Eurozone to reduce dollar dominance and increase economic cooperation. International trade policies govern trade agreements between nations, while unilateral trade orders only benefit the imposing country without input from others.

Uploaded by

Jericho Fajardo
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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02 Worksheet 1

1. What is economic globalization?


Economic globalization is a historical phenomenon that has resulted from human ingenuity and
technical
advancement. It refers to the growing global interconnectedness of economies, particularly through
the cross-border movement of products, services, and capital.
2. Is economic globalization a new phenomenon?
Globalization is not a new phenomenon because it happened or started 30 years ago or so, in our
history.
3. What are the differences and similarities between convergence and divergence?
When a country society reorganizes itself to become increasingly similar to another, this is called
convergence. Alternatively, two societies may converge through mutual realignment, in which they
imitate each other's institutions and practices. While divergence is a process of diversification among
nations in numerous dimensions such as culture, policy, and economy. Their similarities are they both
started in long time ago or in the history.
4. What does International Monetary Systems do?
International monetary system refers to the system and rules that govern the use and exchange of
money around the world and between countries. Each country has its own currency as money and the
international monetary system governs the rules for valuing and exchanging these currencies.
5. What is The Gold Standard?
The gold standard is a monetary system where a country's currency or paper money has a value
directly linked to gold. With the gold standard, countries agreed to convert paper money into a fixed
amount of gold. A country that uses the gold standard sets a fixed price for gold and buys and sells gold
at that price.
6. What are the roles of The Bretton Woods System and Its Dissolution?
The Bretton Woods System created a lasting influence on international currency exchange and
trade through its. development of the IMF and World Bank.
7. What does European Monetary Integration do?
Integration wanted to create a common market, where goods, services, capital, and labor moved
freely, Reducing the excessive influence of the US dollar on domestic exchange rates, and led, through
various attempts, to the creation of a Monetary Union and a common currency. Neither the US dollar nor
gold could play a role in the stabilization process of exchange rates. Instead, a symmetric adjustable peg
arrangement, the European Exchange rate mechanism was created. The success of the EMS and the total
abolishment of capital controls by the end of the 1980's opened for Jacques Delors, then President of the
European Commission, to propose a radical leap forward in European economic integration. The first ten
years of the EMU were an evident success for participating countries: trade and capital transactions
increased; economies became more integrated; macro -economic stability was restored and the euro
became the most widely used reserve currency.
8. What are International Trade and Trade Policies?
International trade policy describes collectively the international laws and multilateral trade
agreements that govern the sale of goods between different countries.
9. What is Unilateral Trade Order?
Is a commerce treaty that a nation imposes without regard to others. It benefits that one country
only. It is unilateral because other nations have no voice in the subject. The enactment of the US reciprocal
trade agreements Act in 1934 eventually put a halt to any further decline in international trade. The act
authorized the president to determine trade policies and also eased the pressure put on the government for
protection. In practice the act was a return to principle of MFN and it gave a stable base for a renewed
international trade regime following World War II.

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