Problems in World Order
POLI 253
Course Objective: Economic globalization is controversial. This course is designed to
introduce you to the factors that are fuelling this controversy, and to encourage you to
examine them in a broad rather than a narrow context. To achieve these objectives, the
course focuses principally on international trade and multinatio nal corporations (MNCs)
as the principal driving forces of globalization. We examine the creation, evolution, and
functioning of the GATT and World Trade Organization. We look in detail at the role of
MNCs in the global economy. We will look at the impact of globalization on labor in the
United States and how globalization drives the politics of American trade policy. We will
then examine the impact of globalization on developing countries. Here we will focus on
the impact of globalization on poverty in developing countries. We will look in detail at
trade, MNCs, debt, as well as discuss the role of the WTO, IMF, and World Bank in
developing countries.
Course Readings: All readings for this course are available online through Blackboard
under this course number. Book chapters are available in the section “Course
Documents” and readings from the web are available under the section “External Links.”
The URL for Blackboard is
Course Requirements: Your grade in this class will be based on three components:
1. Tests: There will be a mid-term and a final exam. Each is worth 30% of your
grade.
2. Paper: You will be required to write a ten page paper, exclusive of the in-class exam, in three parts over the course of the semester. This paper will be highly structured according to my specifications. Adetailed description of these specifications is included at the end of the syllabus.
The paper is worth 30% of your grade, which is broken down as follows:
a. Part 1 is worth 8% of your grade.
b. Part 2 is worth 8% of your grade.
c. Part 3, and the paper as an entirety, is worth 14% of your grade.
1. Attendance: Class participation will count for the other 10% of your grade. This
includes:
a. Preparing one in-class presentations on a specific aspect of
globalization.
b. Participating regularly in discussions . To do so effectively, you will
have to read the assigned material before class meets. I reserve the right
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to administer periodic reading-based quizzes to evaluate how many of you
are doing the reading before class. Such quizzes will constitute a
significant percentage of your participation grade.
c. Attending class regularly. I will take attendance daily. Each student is
entitled to two unexcused absences. I must excuse any additional
absences. Every unexcused absence will cost you two points off your final
grade. No Exceptions .
Date Topics and Readings
January 7 Introductory Meeting
January 9 Introduction to Globalization
Reading:
Brawley, “Defining Globalization”
January 14
Country
Selection
Due
Globalization in Perspective: Creation and Evolution of
the Multilateral Trade System
Reading:
Oatley, Chapter 2, pages 2 -26.
January 16 The World Trade Organization: Rules and Procedures
Reading:
Selections from WTO website
January 21 The Case for International Trade and the WTO
Reading:
Oatley, Chapter 2, pages 26-36.
January 23 Who’s Afraid of the WTO?
Reading:
Global Exchange and WTO websites
January 28 Trade and Incomes: Who Wins and Who Loses from
Trade?
Reading:
Oatley, Chapter 3, pages 10-36.
January 30 Trade, Incomes, and Trade Politics in the United States
Reading:
Oatley, Chapter 3, pages 10-36.
February 4 MNCs in the Global Economy
Reading:
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Oatley, Chapter 5, pages
February 6
Part 1 of
Paper Due
Regulating MNCs in the Global Economy
Reading:
Oatley, Chapter 5, pages 37-44.
February 11 What Does American Labor Want?
Reading:
Selections from AFL-CIO website
February 13 Regulating Labor in the Global Economy
Reading:
O’Brien et al. “The World Trade Organization and Labour,”
pages 73-77 and 82-106.
Core Labor Standards, on-line materials
February 18
Trade and the Environment
Reading:
UNEP. 2000. Environment and Trade: A Handbook. Pp. 27-
31; 35-40.
I.M. Destler, and Peter J. Balint. 1998. The New Politics of
American Trade: Trade, Labor, and the Environment.
Washington, D.C.: Institute for International Economics,
Chapter 3.
February 20 Trade and the Environment
Reading:
UNEP. 2000. Environment and Trade: A Handbook. Pp. 27-
31; 35-40.
I.M. Destler, and Peter J. Balint. 1998. The New Politics of
American Trade: Trade, Labor, and the Environment.
Washington, D.C.: Institute for International Economics,
Chapter 3.
February 25 Test 1
February 27 Developing Countries in the Global Economy:
Introduction
Reading:
William Easterly, “To Help the Poor”
World Bank, “Growth, Inequality, and Poverty,” pages 45-48
March 4 Trade, Growth, and Poverty
Reading:
UNCTAD, 2002. “Patterns of Trade Integration and Poverty”
March 6 Developing countries and the WTO
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Part 2 of
Paper Due
Reading:
World Bank, “Global Prospects 2001.”
March 18 Developing countries and the WTO
Reading:
World Bank, “Global Prospects 2001.”
March 20 MNCs and Developing Countries
Reading:
Graham?
Klein
March 25 Sweatshops (Student Presentations)
Reading:
On-Line Reports on Sweatshops
March 27 Sweatshops in Broader Context
Reading:
Paul Krugman, “In Defense of Cheap Labor”
April 1 The International Monetary Fund and World Bank
Reading:
April 3 No Class
April 8 The International Monetary Fund and World Bank
Reading:
April 10 The Debt Problem and Debt Forgiveness
Reading:
Jubilee Campaign; World Bank/IMF HIPC Initiative On-Line
Materials
April 15 The Debt Problem and Debt Forgiveness
Reading:
William Easterly, “Forgive Us Our Debts”
April 17 Globalization or National Governance?
Reading:
Erich Weede, “Why Poor People Stay Poor Elsewhere,”
William Easterly, Chapters 11 and 13
April 22 Globalization or National Governance?
Reading:
Erich Weede, “Why Poor People Stay Poor Elsewhere,”
William Easterly, Chapters 11 and 13
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April 24 Alternatives to Globalization?
Reading:
Selections from “Alternatives to Economic Globalization”
April 25 Full Paper Due By 5:00 p.m.
April 29 Final Exam 8:00 a.m.
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Paper Assignment
1. Select a developing country from the attached list.
2. Become an expert on this country’s political and economic structure during the last
forty years, evaluate the reasons for the country’s economic performance in this period,
and suggest a limited number of policy reforms that would improve this performance.
3. The paper is due in three sections. Each section requires specific content, the details of
which are listed below. The first two sections are essentially an exercise in data
collection. I want you to measure each of the variables I ask you to collect for four
distinct time periods:
1. 1960-1970
2. 1971-1980
3. 1981-1990
4. 1991-2001
Ideally, you should provide averages for each variable for each of these periods. When
data for each year in a particular period is unavailable, then collect as much data as you
can and add a footnote indicating the data limitations.
4. Please organize sections 1 and 2 of the paper by variable, not by period. Thus, each
subsection of the paper will examine level and change in one variable across the four
periods.
Country Selection Due By January 14th.
The Details
Section 1: Basic Political and Economic Characteristics
Due: Beginning of Class, February 6th.
1. The Political System: Democracy or Authoritarian Regime? If Authoritarian,
was the government Socialist/Communist, Military, or some other type of regime?
2. Structure of the Economy
a. How Large is the Agriculture Sector
b. How Large is Mining and Other Natural Resources
c. How Large is the Manufacturing Sector
d. How Large is the Service Sector
3. Government Participation in the Economy: Essentially, I want you to come to
an informed judgment about the scale of this involvement. Is the government
highly interventionist in a particular period? Is the scale of this intervention
increasing or decreasing from one period to the next? Some things to consider:
a. How Much Government Ownership of Industry?
b. How Much Government Intervention in Agriculture?
c. How Much Government Control Over Manufacturing Investment?
4. Per Capita Income
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5. Economic Growth. Obtain Measures of Total Economic Growth and Per Capita
Economic Growth.
6. Poverty: Number and percent of population living below the poverty line
(national, $1 per day, $2 per day).
7. Development: United Nations Human Development Index
8. Income Distribution: Find and Report Gini coefficients for as many of these
periods as you can for your country.
9. Macroeconomic Conditions :
a. Inflation Rate
b. Government Budget Deficit/Surplus
10. In presenting this data
a. Please use tables and charts. They help identify trends
b. Write short paragraphs that describe the level and the trends that you see
in this data.
c. Please document the sources for all of your data.
d. Please note where data is unavailable.
Section 2: Linkages to the Global Economy
Due: Beginning of Class, March 6th.
1. Trade
a. Trade Openness (Imports+Exports)/GDP
b. Composition of Exports—Diversified or not; primary commodities (if so,
which ones?) or manufactured goods?
c. Terms of Trade and Changes in Terms of Trade
d. Trade Protectionism—Tariffs and Non- Tariff Barriers, with a focus on
level and changes in the level
2. Finance
a. Foreign Debt, expressed in absolute amount and as a percent of the
country’s exports and GDP
b. Foreign Debt Service, expressed as a percent of the country’s exports and
as a percent of the country’s GDP
c. Identity of Principal Creditors—Is debt owed to private lenders or to
official lenders (i.e., the IMF, World Bank, other governments).
3. Foreign Direct Investment—How much and what kind? Does the country have an
export-processing zone (EPZ)?
4. Current Account and Balance of Payments Position—express in absolute terms
and as a percent of GDP.
5. In presenting this data
a. Please use tables and charts. They help identify trends
b. Write short paragraphs that describe the level and the trends that you see
in this data.
c. Please document the sources for all of your data.
d. Please note where data is unavailable
Section 3: Analysis
Due: By Friday, 5:00 p.m. April 25
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1. Your exercise in data collection and analysis will have generated some sort of
pattern concerning per capita incomes, poverty, and the human development
index. For example
a. Per capita incomes in your country have increased and poverty has fallen
since 1960-1970.
b. Per capita incomes in your country have fallen relative to some earlier
high point (perhaps in the late 1970s) and poverty has increased.
c. Per capita incomes in your country display little tendency to change.
d. Per capital incomes in your country exhibit lots of variation—rising and
then falling, only to rise again.
2. The data will also illustrate in broad terms your country’s participation in the
global economy.
3. You must explain why this pattern has emerged in your country.
a. In particular, I want you to focus on country-specific factors versus the
global economy. That is, is the pattern you see the result of lots of
government and very little market (including the international market) or
is it instead the result of little government and lots of market?
b. In engaging in this analysis, you must be very specific and explicit about
the factors driving these patterns.
4. You must draw on other scholarly sources to help you make sense of the pattern
you see. These sources can focus on the experience of your specific country and
they can focus on the broader issue of economic development.
5. Finally, write a brief section detailing two of the most important changes (either
to the government’s policies or to the global economic system) that you believe
would be most helpful to your country. The changes you suggest should emerge
logically from your prior analysis.
Data Sources
Most of the economic data you need for Sections 1 and 2 can be acquired from a CDROM
put together by the World Bank: World Development Indicators on CD-ROM.
This resource is available at Davis Library Reference Desk. The Reference Librarians
will be delighted to show you how to use it.
I have also posted two Excel files on blackboard. One file, called “macro,” provides a
number of economic indicators across time for many countries. Depending upon data
availability, some extend back until 1960. The other file, called “social”, provides a
number of social indicators for many countries. If you use data from these files,
please cite them as William Easterly and Mirvat Sewadeh, “Global Development
Network Growth Database,” World Bank, 2003. You can also access them from the
World Bank’s website at
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The United Nations publishes its Human Development Report in which it provides its
Human Development Index. A table with trends in this index, as well as explanation
of its construction, is available on blackboard. It is only available from 1975.
Some data on poverty can be found at the World Bank website:
You will have to look beyond this site, however, for a fuller time series.
Data on income distribution is hard to come by, particularly for developing countries.
Moreover, measures of income distribution are imprecise. Thus, one should use
caution when interpreting this data. I have posted the best available data set on
blackboard (Deninger, K., and L.Squire (1998). "A New Data Sets in Measuring
Income Inequality", World Bank Economic Review, vol. 10, no 3).
Use the Gini coefficient provided in this data set. I have also posted a short reading
explaining how to interpret Gini coefficients.
You will have to consult published research on your country to evaluate government
participation in the economy.
List of Countries
ArgentinaEthiopiaPakistan
BangladeshGabonParaguay
BeninGambia, The Peru
BoliviaGhanaPhilippines
BotswanaGuatemalaRwanda
BrazilGuineaSenegal
Burkina FasoHaitiSierra Leone
CameroonHondurasSwaziland
Central African RepublicIndiaTanzania
ChadJamaicaTogo
ChileKenyaTurkey
Congo, Dem. Rep. (Zaire) MalawiUganda
Costa RicaMaliUruguay
Cote d'Ivoire Mauritania Venezuela
DjiboutiMexicoZambia
Dominican RepublicMozambiqueZimbabwe
EcuadorNigeria