Podcast
Questions and Answers
What primarily attracts Foreign Direct Investment (FDI) to China?
What primarily attracts Foreign Direct Investment (FDI) to China?
- Low labor costs only
- Government tax incentives exclusively
- High-quality labor and stable conditions (correct)
- Large market size regardless of conditions
How does the Beijing Consensus differ from the Washington Consensus?
How does the Beijing Consensus differ from the Washington Consensus?
- Emphasizes strong state intervention and social investment (correct)
- Focuses on minimal state intervention
- Promotes market-driven solutions exclusively
- Rejects any form of local economic strategies
Which of the following elements is a key feature of the Chinese model of economic development?
Which of the following elements is a key feature of the Chinese model of economic development?
- A blend of state control with market dynamics (correct)
- Complete market deregulation
- Dependence solely on foreign investments
- Strict adherence to the Washington Consensus
What is a significant legacy of the Washington Consensus?
What is a significant legacy of the Washington Consensus?
Which aspect does strategic trade theory emphasize in relation to government intervention?
Which aspect does strategic trade theory emphasize in relation to government intervention?
Which of the following is NOT a priority of the Beijing Consensus?
Which of the following is NOT a priority of the Beijing Consensus?
What role do state-designated regions play in the Chinese model?
What role do state-designated regions play in the Chinese model?
Which characteristic describes the approach taken by the Beijing Consensus?
Which characteristic describes the approach taken by the Beijing Consensus?
In the context of the Chinese economic model, which statement is accurate?
In the context of the Chinese economic model, which statement is accurate?
What impact has the mixed approach of the Beijing Consensus had on economic development?
What impact has the mixed approach of the Beijing Consensus had on economic development?
What was one of the key critiques of the Washington Consensus relating to social impacts?
What was one of the key critiques of the Washington Consensus relating to social impacts?
What does the Post-Washington Consensus emphasize?
What does the Post-Washington Consensus emphasize?
Which of the following is a core concept of Strategic Trade Theory?
Which of the following is a core concept of Strategic Trade Theory?
Which form of government intervention aims to protect domestic industries?
Which form of government intervention aims to protect domestic industries?
What economic approach was adopted by China post-1978 under Deng Xiaoping?
What economic approach was adopted by China post-1978 under Deng Xiaoping?
What was a significant achievement of the Chinese Development Model?
What was a significant achievement of the Chinese Development Model?
What was one unintended consequence of the One-Size-Fits-All approach of the Washington Consensus?
What was one unintended consequence of the One-Size-Fits-All approach of the Washington Consensus?
Which country is known for significant government support for its aerospace industry, specifically Airbus?
Which country is known for significant government support for its aerospace industry, specifically Airbus?
Which of the following best describes the approach of the Beijing Consensus?
Which of the following best describes the approach of the Beijing Consensus?
What aspect of the Washington Consensus was criticized as economic imperialism?
What aspect of the Washington Consensus was criticized as economic imperialism?
Flashcards
Chinese Model FDI
Chinese Model FDI
Foreign Direct Investment (FDI) attracted to China due to high-quality labor, not just low costs, facilitated by state-designated regions for industrialization.
Balanced Approach (China)
Balanced Approach (China)
China's economic development blends state control with market forces to achieve growth and stability.
Beijing Consensus
Beijing Consensus
An alternative development model emphasizing state intervention, social investment (education, healthcare), and locally-tailored economic strategies.
Washington Consensus
Washington Consensus
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Strategic Trade Theory
Strategic Trade Theory
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Mixed Impact (Washington Consensus)
Mixed Impact (Washington Consensus)
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Washington Consensus
Washington Consensus
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Critiques of Washington Consensus
Critiques of Washington Consensus
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Social Impacts (Washington Consensus)
Social Impacts (Washington Consensus)
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Economic Sovereignty
Economic Sovereignty
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One-Size-Fits-All Approach
One-Size-Fits-All Approach
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Short-Term vs. Long-Term Growth
Short-Term vs. Long-Term Growth
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Post-Washington Consensus
Post-Washington Consensus
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Strategic Trade Theory
Strategic Trade Theory
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Increasing Returns to Scale
Increasing Returns to Scale
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Entry Barriers
Entry Barriers
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Chinese Development Model
Chinese Development Model
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Socialism with Chinese Characteristics
Socialism with Chinese Characteristics
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Deng Xiaoping
Deng Xiaoping
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Beijing Consensus
Beijing Consensus
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Successful Examples (Strategic Trade Theory)
Successful Examples (Strategic Trade Theory)
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Study Notes
Washington Consensus Critiques
- Critiques centered on social impacts, economic sovereignty, one-size-fits-all approach, and short-term growth vs long-term.
- Austerity and privatization exacerbated inequality, poverty, and social unrest.
- Perceived as economic imperialism, undermining local decision-making, especially in Latin America.
- Inappropriate for all contexts, leading to unintended consequences.
- Stabilization efforts often failed to create sustainable and inclusive growth, repeating debt crises.
Post-Washington Consensus
- Emerging in the late 2000s, emphasized poverty reduction, social inclusion, and institutional development.
- Blended market reforms with tailored policies to strengthen institutions, protect vulnerable groups, and promote environmental sustainability.
Strategic Trade Theory
- Emphasizes industries with high returns and entry barriers (aerospace, semiconductors, biotech).
- Governments can intervene to promote domestic firms, increasing income and jobs.
Forms of Government Intervention
- Subsidies reduce costs and boost competitiveness.
- Export incentives offer tax breaks to increase export market share.
- Import restrictions (tariffs and quotas) safeguard domestic industries.
- Research and development (R&D) support fosters innovation for global competitiveness.
Successful Examples of Strategic Trade Theory
- EU subsidized Airbus to compete with Boeing.
- Japan invested in electronics and automotive in the 1980s.
- South Korea incentivized Samsung and LG.
Chinese Development Model (Beijing Consensus)
- Evolved from Soviet-style socialism to a state capitalist model with market reforms after 1978.
- Boosted agricultural output (8.2% annual growth) and sustained a 9.5% annual GDP growth.
- Successfully lifted over 500 million people from poverty.
- Became a global exporter and manufacturer.
Key Features of the Chinese Model
- High-quality labor (health, education, predictability) proved more attractive to FDI than low costs.
- State-designated regions spurred industrialization to attract investments.
- Blended state control with market dynamics for stable, rapid growth.
Impact of the Beijing Consensus
- Offers a contrasting development model to the Washington Consensus, prioritizing strong state intervention, social investment (in areas like health and education), and tailored, local economic strategies.
Key Takeaways for Political Science Students
- The Washington Consensus had mixed results, with some countries experiencing growth but others facing inequality and instability.
- Strategic trade theory highlights the potential of targeted interventions for key industries.
- The Beijing Consensus presents a flexible state-driven model for development different from Western liberal economics.
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