Chapter 2

Front 1

political economy

Back 1

the part of political science that focuses on the connections between economics and politics

Front 2

class

Back 2

a large group of people with similar economic attributes that shape their lifestyles and life chances

Front 3

mode of production

Back 3

the type of economic system based on methods of production, patterns of property ownership, and relations between workers and owners

Front 4

means of production

Back 4

the individual businesses, factories, and other entities that produce goods, as well as the machines and other inputs used to produce them.

Front 5

bourgeoisie

Back 5

a term used by political economy scholars such as Karl Marx to refer to individuals who own the means of production

Front 6

proletariat

Back 6

a term used by political economy scholars like Karl Marx to refer to the individuals who use the means of production in their work but do not own them

Front 7

working class

Back 7

includes individuals in a variety of occupations, such as manual laborers, who have historically greeted relatively low levels of incomes

Front 8

middle class

Back 8

includes individuals in a variety of occupations who generate moderate levels of income, including small business owners and service sector employees

Front 9

old middle class

Back 9

small business owners

Front 10

new middle class

Back 10

service workers, white-collar managers, and civil servants

Front 11

upper class

Back 11

the wealthiest and most powerful members of society

Front 12

underclass

Back 12

the poorest individuals in society who have few chances from improving their lives

Front 13

median income

Back 13

the amount of income above that earned by those in the bottom half of the population and below that enraged by those in the upper half of the population

Front 14

class structure

Back 14

the pattern of how the population of a particular country falls into different class categories; relates to level of economic equality

Front 15

class consciousness

Back 15

the sense of belonging to and solidarity with a particular class, as well as the recognition of this class's relationship with other classes

Front 16

economic development

Back 16

changes over time in an economy that enhance its productive capacity and improve society's prosperity

Front 17

economic growth

Back 17

one way of thinking about economic development, it looks at annual changes in a country's GDP

Front 18

Gross Domestic Product (GDP

Back 18

the sum value of the goods and services in a country's economy

Front 19

constant dollars

Back 19

technique that controls for increased value due to inflation

Front 20

informal economy

Back 20

the portion of a country's economic activity from illegal undertakings as well as unreported legal economic activities

Front 21

prosperity

Back 21

the overall wealth and standard of living of a country; it is usually measured by GDP per capita or similar statistics

Front 22

GDP Per Capita

Back 22

the gross domestic product of a state divided by the number of people in that state

Front 23

purchasing power parity (PPP)

Back 23

an adjustment to statistics, such GDP per capita, that takes into account the cost of living in a given country

Front 24

Human Development Index (HDI)

Back 24

a measure of economic development that includes not only GDP but also education and health statistics

Front 25

Economically Developed Countries (EDCs)

Back 25

countries with high levels of per capita GDP, a sizable middle class, and diverse economies

Front 26

lesser developed countries (LDCs)

Back 26

countries with lower per capita GDP and a small middle class; economic activity is often concentrated in agriculture and raw materials extraction

Front 27

Least Developed of the Lesser Developed Countries (LLDCs)

Back 27

the poorest countries in the world

Front 28

Newly industrialized Countries (NICs)

Back 28

the more economically developed LDCs, found particularly in Asia and Latin America

Front 29

finished products

Back 29

goods produced from raw materials, which are much more expensive than the raw materials that go into them

Front 30

countries in Transition (CITs)

Back 30

another term for the post communist states

Front 31

emerging markets

Back 31

the LDCs and CITs that are most desirable to foreign investors

Front 32

BRICS

Back 32

acronym for five of the most important emerging market countries: brazil, russia, india, china, and south Africa

Front 33

resource curse

Back 33

the tendency for developing countries with an exportable commodity to focus on the ext ration of that resource at the expense of broader economic development; associated with government corruption and failure to develop a middle class

Front 34

capitalism

Back 34

an economic system based on private ownership of property with business and economic activity talking place within the market

Front 35

market

Back 35

a system of economic exchange in which suppliers and purchasers find each other and agree to the terms of the transaction

Front 36

market forces

Back 36

forces, such as supply and demand, that drive the terms of transaction in capitalism

Front 37

free-market capitalism

Back 37

another name for the capitalist ideal, with animal government regulation of the economy and little social welfare spending

Front 38

monopoly

Back 38

control of all or nearly all the market for a given good or given by a single company

Front 39

socialism

Back 39

an economic approach that emphasizes government ownership of the means of production and government control of economic decisions such as the supply and prices of particular products; also known as central planning

Front 40

black market

Back 40

a market in which goods and services are bough and sold illegally

Front 41

mixed economies

Back 41

economies with elements of capitalist and socialist practices

Front 42

labor-led capitalism

Back 42

approach that involves a substantial role for government in the relation of the economy and the establishment of social welfare programs, also known as a social democratic system.

Front 43

welfare state

Back 43

an approach in which a broad set of government programs provide significant welfare benefits and services

Front 44

state-led capitalism

Back 44

a system in which the government intervenes in the economy to guide economic activities in an effort to foster economic growth

Front 45

mercantilism

Back 45

a form of capitalism that accepts the general principal of free-market economics but allows significant government involvement in the economy in order to protect domestic economic interests; also known as protectionism.

Front 46

state capitalism

Back 46

a system in which the government neither engages in economic planning nor oversees an extensive welfare state, but owns certain individual enterprises, typically in lucrative industries such as energy

Front 47

globalization

Back 47

the process of increasing connections in the areas of economics, communications, technology, and politics

Front 48

foreign direct investment (FDI)

Back 48

investment from outside a country into a particular economic entity that is designed to develop a lasting presence

Front 49

imports

Back 49

products and services made outside the borders of a state that are brought inside for consumption

Front 50

exports

Back 50

products and serves produced inside the boarders of a state that are sent outside for consumption

Front 51

postwar settlement

Back 51

the compromise in western europe after world war 2 between those who wanted a socialist system and those who desired one that was more free market

Front 52

social market economy (SME)

Back 52

the economic approach that developed in Germany, which united corporatism and welfare state protections with traditional social values

Front 53

weak state theories

Back 53

a set of theories that argue that globalization limits the ability of governments to tax, spend, and regulate

Front 54

race to the bottom

Back 54

a component of weak state theories that contends that states lower standards and reduce regulations to attract or maintain to presence of large corporations

Front 55

strong state theories

Back 55

a set of theories that argue that even with increasing globalization, governments have maintained and even enhanced their ability to tax, spend, and regulate

Front 56

import substitution industrialization

Back 56

a development strategy emphasizing subsides of key domestic industries and other protectionist trade policies; used by countries such as Mexico and brazil, particularly from WW2 through the 1970s

Front 57

dependency theory

Back 57

the view that LDCs have become economically dependent on the EDCs through the system of international capitalism

Front 58

oligarchic capitalism

Back 58

a term used by analysts to describe the russian economic system of the 1990s, which they believed benefited a small number of economically and politically powerful individuals

Front 59

modernization theory

Back 59

the view that a country's move from underdevelopment to modernization can be understood from and modeled after development in the west

Front 60

urbanization

Back 60

a dramatic increase in the portion of a country's population that lives in large cities

Front 61

physical capital

Back 61

the means of production used in an enterprise

Front 62

human capital

Back 62

the skills and other productive characteristics of workers

Front 63

asian economic model

Back 63

a combination of state-led development measures and authoritarian political practices; commonly found in asia from the 1970s through the 1990s.

Front 64

neoliberalism

Back 64

a pro market economic approach that emphasizes reductions in the role of government to encourage economic growth