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| the global distribution of the production of goods and services, through reduction of barriers to international trade such as tariffs, export fees, and import quotas. |
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| is the economic doctrine in which government control of foreign trade is of paramount importance for ensuring the prosperity and military security of the state |
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| Washington Consensus (WC) |
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Definition
Phrase coined by John Williamson to refer to the prevailing views held in the late 1980's and early 1990's by the international financial institutions and governments of most industrialized countries regarding the desirable policy agenda for less developed economies.
Example: Liberalization of their trade regimes, privatization of state-owned enterprises, and reduction of state intervention in the economy. |
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General Agreement of Tariffs and Trade
A 1947 agreement that became the principal component of the international trade regime following the failure of the international community to establish the International Trade Organization. Its provisions were incorporated into the World Trade Organization (WTO) when it was established in 1995. |
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| International Monetary Fund |
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Definition
| Designed at the Bretton Woods Conference, July 1944. Goal to stabilize exchange rates and assist the reconstruction of the world’s international payment system. Countries contributed to a pool which could be borrowed from, on a temporary basis, by countries with payment imbalances. The IMF works to improve the economies of its member countries. |
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| A branch of economic theory associated with the work of John Maynard Keynes and his followers, suggesting that there is no automatic tendency for economies to reach an equilibrium position that sustains full employment, and that governments, through their manipulation of fiscal policies, can affect aggregate demand and reduce unemployment. |
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| The use of government expenditure and revenue collection (taxation) to influence the economy. |
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| System of monetary management which established the rules for commercial and financial relations among the world's major industrial states in the mid 20th century. The Bretton Woods system was the first example of a fully negotiated monetary order intended to govern monetary relations among independent nation-states. |
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| are the policies implemented by the International Monetary Fund (IMF) and the World Bank (the Bretton Woods Institutions) in developing countries. These policy changes are conditions for getting new loans from the International Monetary Fund (IMF) or World Bank, or for obtaining lower interest rates on existing loans. |
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| The act of a country protecting its domestic industries. One way is to enact tariffs, which tax imports. |
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| Multilateral Trade Rounds |
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| Trade rounds that concentrate on reducing tariffs. |
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| Bilateral Trade Agreements |
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Definition
Agreements that are between two nations at a time. They are fairly easy to negotiate, and give those two nations favored trading status between each other.
In the absence of a successful multilateral trade agreement, a series of bilateral agreements will usually take place. |
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| A concept put forward by John Gerard Ruggie, following Karl Polanyi, to capture the compromise in post-war economic regimes between liberalization and the pursuit of domestic social and political objectives. |
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| An economic and political union or confederation of 27 member states which are located primarily in Europe. |
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Refers to a scenario in which small shocks, which initially affect only a few financial institutions or a particular region of an economy, spread to the rest of financial sectors and other countries whose economies were previously healthy.
Example: At the domestic level, usually the failure of a domestic bank or financial intermediary triggers transmission when it defaults on interbank liabilities and sells assets in a fire sale, thereby undermining confidence in similar banks. |
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| group of finance ministers and central bank governors from 20 major economies: 19 countries plus the European Union, which is represented by the President of the European Council and by the European Central Bank. |
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| rious forms of controls imposed by a government on the purchase/sale of foreign currencies by residents or on the purchase/sale of local currency by nonresidents. |
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