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Thread: Help with International political economy question.

  1. #1 Help with International political economy question. 
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    Hi guys, im currently studying and really struggling with my IPE module, and Im trying to formulate a plan for an essay which I have to do(before tomorrow). Any help or thoughts on the situation would be much appreciated.


    My essay question is - Are the benefits of international trade received by “developed” and “developing” economies comparable?


    Cheers guys.


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  3. #2  
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    Look at wealth per capita in both categories and "bing!", there's your answer. Why is this the case, though? Develop in your paper. Just a suggestion, there are other resources on the 'net which will be of greater assistance to you than this one, and you ARE on a deadline, sooo... Keep us posted and best of luck.

    Bastards of them to spring this on you on a Sunday, so sudden like!


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  4. #3  
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    Thanks Arthur Angler! Im really trying to formulate a plan of attack, once I have that I can usually fight my way through.

    only 1950 words to go!!
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  5. #4  
    Forum Ph.D.
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    I use the USA/ China for answering the question the way (I) see it.
    and in my mind, developed = high wages, high valued curency , and developing = low wages, low valued currency (though this statement may not be accurate)


    I would answer the question ? NO.



    I feel the only benifit to the developed country, is getting manufactored goods at very low prices.


    While the benifits for the developing country are many,

    a large revenue stream of the developed countrys high valued curency, into the developing country
    a building of internal infrastructure , that produces the low priced goods
    the building of modern transpertation routes within the developing country, to get the cheaply priced goods out, and the jobs this creates
    many new manufactoring jobs created in the developing country
    ex. ex.
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  6. #5  
    Time Lord
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    Just have to look at it on two levels.

    1) - Trade of currency.

    By trading away its high value currency to get low value currency, the developed country devalues its own currency. That's good and bad. It's good when they want to sell their own goods abroad (which is very hard for a developed country to do nowadays). It's bad when they need to import raw materials for their own industries (such as oil from Saudi Arabia, or iron from India.)

    By trading away its low value currency to get high value currency, the under-developed country increases the value of its own currency. That's mostly bad for them. However, they can dodge the bullet by taking the high value currency and investing it in the developed country's economy or lending the money back as debt. China holds quite a lot of US treasury bills right now. (That's presently the hole in the system that's preventing it from balancing out the way the economists expect it to.)

    2) - Trade of goods

    The developed country doesn't really find much of a market for its goods in the underdeveloped country's economy. Most of the people in the underdeveloped country are too poor to afford the kinds of goods the developed country produces. A small wealthy elite within the underdeveloped economy may buy stuff, but that's a small group.

    The underdeveloped country's overall economy improves as a result of being able to sell to the developed country's stable market, but the distribution of wealth doesn't improve. The workers make the same, small wages they always made. It almost gets more ingrained, because it's understood that those low wages are the sole basis of the country's international trade success. So, whenever money is made, it all goes to the wealthy elite of that country, who basically throw it under a mattress, or buy gold with it (which is the same thing as throwing it under a mattress.)
    Some clocks are only right twice a day, but they are still right when they are right.
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