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Description
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Term
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Those economies in which the imbalance in the global balance of payments is maintained by a lack of confidence in domestic financial assets and institutions such as in China, causing them to buy more sophisticated and safer British and American financial assets
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Emerging Economies
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That which inequality in is caused by inheritance, marriage (concentrates said thing), saving (easier and with better returns for those with more of said thing), skills/enterprise, and chance (lottery)
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Wealth
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An account identifying transactions in financial assets between the residents of a country and the rest of the world, such as investment flows and central government transactions in foreign exchange reserves
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Financial Account of the Balance of Payments
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They which benefit from international/external trade due to access to larger markets allowing for increased production and economies of scale, technology transfer, easier and cheaper access to raw materials, and the potential for greater revenue and profit and thus investment
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Firms
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That which government might try to increase via privatisation, deregulation, cuts to direct taxes (partly to attract multinational companies), transport and infrastructure investment, education and training investment, and exchange rate manipulation
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International Competitiveness
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The trend in financial markets that has much facilitated globalisation, somewhat reversed since the financial crisis
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Deregulation
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A ratio comparing the export prices paid by a country with the price it has to pay for its imports, being either positive or negative, calculated as 100×(average price of exports÷average price of imports)
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Terms of Trade
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That the four components of which are trade in goods, trade in services, income, and current transfers
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Current Account
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That the lack of which on certain products may not stop a country producing them in an effort to support industries which may develop it in future as well as to protect strategic industries, and mitigate the risks posed by external shocks from over-specialisation
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Comparative Advantage
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Development which meets the needs of the present without compromising those of future generations
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Sustainable Development
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A decreasingly used non-tariff barrier where a government restricts the availability of foreign currency in line with the level of imports it thinks the country can afford
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Exchange Controls
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The ability of an economy to sell its exports well in competition with other economies, calculated using a wide range of variables
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International Competitiveness
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That which alongside specialisation, the principal advantage of is higher world output and raised living standards
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International Trade
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A financial crisis felt mostly in Thailand and Indonesia which saw relatively little effect outside Asia (except for Latin America and Eastern Europe) and may even have helped countries like Thailand and South Korea emerge as stronger economies due to the failure of inefficient firms and increases in financial regulation
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1997 Asian Financial Crisis
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Those which are affected by globalisation in that they must increase efficiency due to global competition, while brand variation across countries decreases - such as opal fruits becoming starburst in the UK - so as to take advantage of marketing economies
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Firms
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Where countries adopt a common currency
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Monetary Union
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A condition that states that for devaluation to successfully improve the trade imbalance, the combined price elasticities of demand for exports and imports must exceed one, i.e. be relatively elastic, as must the elasticity of supply of exports
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Marshall-Lerner Condition
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That in imbalance in which is much determined by its size, duration, cause (cyclical, structural), and whether it can be financed by a financial account surplus
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Current Account
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The collective name for the income and current transfers components of the current account
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Balance of Trade
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That which affects macroeconomic policy as it prevents the use of monetary policy to stabilise the economy as it is needed to maintain the exchange rate, however it imposes financial discipline on governments
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Fixed Exchange Rate
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