CHƯƠNG 6

1. Does modernization theory or dependency theory explain underdevelopment in

Southern countries? Why?
Dependency theory explain underdevelopment in Southern countries Because:
• The dependency thinkers of third world countries fear the injustice and inequality faced by
their countries. Their main focus is on finding the reasons for the inequality.
• The theory explains the reason behind underdevelopment in third world countries and it
blames rich developed countries for global poverty. Some countries became rich at the
expense of other nations, especially poor countries, while modernization theory blames poor,
underdeveloped third world countries for their poverty.
• Examples of dependency theory appear all over the world. Dependency theory explains
how the United States treats Latin American countries and how Latin American countries
respond to America. Just like how China makes central African countries dependent on it, by
providing mortgage loans or more macro, is how the EU affects the Asian and African
markets.
*Main idea of modernization theory explained underdevelopment in Southern countries
The main idea of modernization theory is that underdevelopment in Southern countries is
primarily attributed to their traditional and backward social, economic, and political
structures. According to this theory, these countries can overcome underdevelopment and
achieve economic growth and societal progress by adopting Western models of development.
Key points of modernization theory regarding underdevelopment in Southern countries
include:
1. Traditional Societies: Modernization theory suggests that traditional societies in Southern
countries have cultural and social characteristics that impede progress. These societies are
often portrayed as being rooted in traditional values, customs, and institutions, which are
seen as obstacles to development.
2. Westernization and Modernization: The theory argues that Southern countries need to
adopt Western values, institutions, and practices to modernize and achieve development. This
typically involves embracing industrialization, urbanization, technological advancements,
and market-oriented economic systems.
3. Stages of Development: Modernization theory proposes a linear model of development,
suggesting that countries progress through distinct stages of development. The idea is that
Southern countries need to transition from traditional agricultural economies to
industrialization and eventually reach the stage of a fully developed Western society.
4. Role of Institutions: Modernization theory emphasizes the importance of creating modern
political, legal, and administrative institutions to support development. It suggests that
Southern countries need to establish stable governance structures, rule of law, and efficient
bureaucracies to attract investments, promote economic growth, and enhance social progress.
2. The role of the world bank in assisting underdeveloped countries
The World Bank plays a crucial role in assisting underdeveloped countries by:
+ Providing long-term loans, zero to low-interest credit, and financing to less-developed
country
+ Provide financial support through trust fund partnerships with donors.
+ Supporting underdeveloped countries through policy advice, research, and analysis as well
as technology transfer support
+ To ensure that countries have access to the best global expertise and help create cutting-
edge knowledge.
CHƯƠNG 7: GLOBALIZATION
1. What are some main criticisms of globalization
Globalization faces several main criticisms, including increasing social inequality by
widening the gap between the rich and the poor within and between countries. It can put
pressure on local industries and businesses, making it harder for them to compete with
imported goods and services. Globalization can also lead to job losses as companies move
production to countries with cheaper labor. Additionally, it can contribute to environmental
degradation and the loss of cultural identity. Furthermore, globalization can make economies
more vulnerable to global shocks, such as financial crises, pandemics, and other global
disturbances.
2. Impact of globalization on developing country:
• Positive impact of globalization:
+ Promote the strong development of the productive forces, bringing high growth to the
world economy.
+ Expand and develop the global economy
+ Globalization helps developing countries to deal with the rest of the world and increase
their economic growth, solving the poverty problems in their country
+ Globalization contributed to developing the health and education systems in the developing
countries.
• Negative impact of globalization:
+ Production and business within each country under pressure of the flow of goods-services,
technology imports and regional, global shocks.
+ Economic globalization increases social inequality in society, deepening the gap between
the rich and the poor in each country and between countries.
+ Economic globalization can make all activities and human life become less safe,For
example: Financial crisis broke out in Thailand, international terrorism or the pandemic HIV,
Sars,... climate change, global earthquake, tsunami,…
3. What are some impacts of regional integration on developing countries
• Positive impact of Regional integration
+ Stimulating trade creation: The removal of tariff and non-tariff trade barriers among
member states creates new trade in the region.
+ Attracting more investment: Expansion of markets and enhancement of the system of joint
acceptance of investment increases the influx of direct investment.
+ Benefits developing countries through cooperation with developers: Expanding market,
Accelerating technology transfer, Increasing employment opportunities and labor mobility
• Negative impact
+ Cutting tariff revenues: For many developing countries, tariff revenues are a major source
of fiscal income. Reducing tariff rates means that they may no longer be able to rely on this
source of revenue.
+ Loss of national sovereignty: With each new round of discussions and agreements within a
regional bloc, nations may find that they have to give up more of their political and economic
rights. Regional integration creates winners and losers, notably within countries.
+ Trade diversion: Member countries may trade more with each other than with nonmember
nations. This may mean increased trade with a less efficient or more expensive producer
because it is in a member country
4. In the viewpoint of liberalism, what are the reasons for the rising of regional
integration
From the liberalism perspective, regional integration rises due to several reasons:
Liberalism supports regional integration because it promotes free markets and open trade.
RIAs reduce trade barriers, leading to increased trade, competition, and economic growth. By
removing these barriers, resources are used more efficiently, allowing countries to specialize
and lower production costs, offering consumers a wider variety of goods at better prices.
RIAs also create larger markets, helping businesses achieve economies of scale and become
more competitive globally. They attract cross-border investments by creating stable and
larger markets, offering new business opportunities. Additionally, regional integration helps
countries pool resources and increase their bargaining power, which is especially beneficial
for smaller nations competing in the global market.
5. In the viewpoint of Marxism, what are the nature of regional trade agreement (RTA)
From a Marxist perspective, regional trade agreements (RTAs) are seen as instruments that
reinforce capitalist interests and exacerbate global inequalities. Marxism views RTAs as
mechanisms through which powerful capitalist states and multinational corporations can
consolidate their economic dominance and exploit less developed regions. These agreements
often prioritize the interests of the wealthy countries and their corporations by facilitating
access to cheaper resources and labor in developing countries, while imposing unfavorable
trade terms. Marxists argue that RTAs contribute to the perpetuation of economic disparity,
as they often entrench the global capitalist system, benefiting the wealthy at the expense of
the working class and marginalized economies.
6. Why does the Doha round negotiation take so long? Why is the RTA thriving
Because:
- The Doha Round covers a wide range of topics, including agriculture, services, industrial
tariffs, intellectual property, and environmental goods. Finding agreement on all these topics
is challenging.
- The WTO has 164 member countries with different economic priorities. Developed and
developing countries often have conflicting interests, like agricultural subsidies and market
access for industrial goods.
- The WTO requires all member countries to agree on any decisions. This means even one
country can block progress.
- One of the most contentious issues has been the reduction of agricultural subsidies in
developed countries, which developing countries argue distort global markets and harm their
own agricultural sectors.
- Over the years, Global economic and political changes, such as the rise of new economic
powers and shifting trade patterns, have made it harder to reach a deal. Some countries are
also hesitant to reduce tariffs and subsidies, preferring to protect their domestic industries and
jobs.
• The RTA thriving because:
- RTAs are thriving because they offer more flexibility by allowing a smaller group of
countries to negotiate terms that fit their specific needs. They can be made and implemented
faster than WTO agreements because they involve fewer parties and skip some complicated
steps. RTAs also allow for deeper cooperation, like harmonizing regulations and recognizing
each other's standards. Countries use RTAs to strengthen geopolitical ties and increase
regional influence, as seen with the EU, NAFTA/USMCA, and ASEAN. Since global
negotiations like the Doha Round have stalled, countries are turning to RTAs to achieve trade
goals on a smaller scale. Additionally, RTAs bring economic benefits like reduced tariffs,
better market access, and a more stable trading environment.
7. Motivation to promote regionalization development
The motivation to promote regional development stems from the desire to enhance economic
cooperation and integration among neighboring countries, which can lead to greater
economic stability and growth. By creating a unified regional market, countries can benefit
from increased trade, investment, and shared resources, leading to improved infrastructure,
reduced costs, and economies of scale. Regionalization also allows for more coordinated
responses to global challenges, such as economic crises or environmental issues, and can
strengthen political and social ties among member states. Additionally, regional development
initiatives can help address disparities within the region, promote sustainable development,
and improve overall quality of life for the population.
8. Thách thức của DN VN khi cạnh tranh với các tập đoàn MNC
A multinational corporation (MNC) is a company that has business operations in at least one
country other than its home country
In the context of increasingly deep international economic integration, Vietnamese
enterprises (DNVN) are facing many challenges when competing with multinational
corporations (MNC).
One of the biggest challenges is scale and resources. MNCs are often much larger in scale
than SMEs, with abundant financial, technological and human resources. This gives MNCs a
competitive advantage in terms of price, quality products, services and market access.
Another formulation is about management and business processes. MNCs often have more
advanced management and business experience and processes than SMEs. This enables
MNCs to rapidly grasp and apply new market guidance and make more defined business
performance decisions.
In addition, SMEs also face key rules. MNCs often have close relationships with government
agencies, so they can easily access resources and incentives from the government. This
creates unfair competition for Vietnamese enterprises.
9. The effect of free international trade on import-competing industries of host
countries, particularly in terms of employment
The effect of free international trade on import-competing industries of host countries,
particularly in terms of employment, can be complex and varied. Here are some key points to
consider:
1. Increased Competition: Free international trade often leads to increased competition as
domestic industries face competition from foreign producers who can offer similar goods at
lower prices. This increased competition can put pressure on import-competing industries,
potentially leading to job losses or reduced employment opportunities within those industries.
2. Efficiency and Productivity Gains: Free trade can also drive efficiency and productivity
gains in host countries. When import barriers such as tariffs are reduced, domestic industries
are incentivized to become more efficient and competitive to survive in the global market.
This can lead to improvements in productivity, which may help offset job losses in import-
competing industries and potentially create new employment opportunities in other sectors.
3. Reallocation of Resources: Free trade can result in the reallocation of resources from less
efficient import-competing industries to more productive sectors. As industries adapt to
changing market conditions, resources such as labor and capital may shift away from import-
competing sectors towards industries where the country has a comparative advantage. This
reallocation process can lead to short-term disruptions and job displacements but may
ultimately result in a more efficient allocation of resources and long-term economic growth.
4. Industry-Specific Impacts: The impact of free trade on import-competing industries can
vary depending on the specific characteristics of the industry. Some industries may be more
vulnerable to import competition and job losses due to factors such as low-cost labor in other
countries, while others may be able to adapt and remain competitive. Factors such as the
level of technological advancement, economies of scale, and the ability to differentiate
products can influence the industry's resilience to international competition.
5. Overall Economic Effects: It's important to consider the broader economic effects of free
trade. While import-competing industries may experience short-term challenges, free trade
can lead to lower prices for consumers, increased market access for exporters, and overall
economic growth. The benefits of free trade can extend beyond specific industries,
supporting job creation in export-oriented sectors and generating new opportunities in
industries that benefit from increased trade flows.
It's worth noting that the effects of free trade on employment and import-competing
industries are influenced by a range of factors, including government policies, industry
dynamics, and overall economic conditions. Effective policies to manage the transition and
support affected workers and industries, such as retraining programs or targeted assistance,
can help mitigate the potential negative effects of trade liberalization on domestic industries
and employment.
CHƯƠNG 8
1. Khó khăn của các nước đang phát triển trong việc theo đuổi phát triển bền vững
Developing countries face significant challenges in pursuing sustainable development,
including limited financial and government conflict between short-term profits and
investment in sustainable technologies. Economic dependence on industries harmful to the
environment, such as agriculture and mining, complicates efforts to adopt greener methods.
Weak governance and institutions often result in inadequate environmental regulations and
enforcement. High levels of poverty make it difficult to prioritize long-term sustainability
over immediate needs. Additionally, a lack of infrastructure for clean energy and waste
management, combined with vulnerability to climate change impacts, further strains
resources. Limited awareness and education about sustainability also slows progress,
requiring comprehensive support and international cooperation to overcome these obstacles.
2. How to decrease global inequality
Since the Covid-19 pandemic, economic inequality, and global poverty have increased. To
reduce global inequality, it is crucial to increase access to quality education, which can
provide people with the skills and knowledge needed to improve their lives and boost the
economy.
- Policies should be universal in principle, paying attention to the needs of disadvantaged and
marginalized populations.
- There is a need for increased duty-free treatment and continued support for exports from
developing countries.
- Encourage official development assistance and financial flows, including foreign direct
investment, to countries with the greatest need, incredibly least developed countries, African
countries, countries with small island developing countries, and landlocked developing
countries.
- Promoting gender equality
- Finally, technological innovations can help reduce remittance costs for migrant workers.
3. The impact of the russian-ukraine war on the world economy
The war between Russia and Ukraine has strongly affected the world political situation and
fundamentally changed the European security order in the past three decades, after the
collapse of the Soviet Union.
Equally important is a series of simultaneous sanctions in many areas and the strictest ever
that the US, Europe and a number of other countries have enacted to punish Russia. These
events have caused great turmoil in the world financial, oil and gas markets; increase
inflation and reduce economic growth worldwide.
According to the UK's National Institute of Economic and Social Research (NIESR), this war
will reduce global GDP by at least 1% and increase inflation by 3% this year. If the West
embargoes all of Russia's gas exports, the negative impact will be much greater. In general,
the world economy will fall into a recession, making it difficult for businesses to do business.
4. The impact of the US-China on the world economy
This trade war has affected the global economy heavily. The economists have predicted that
if the US-China trade war continues, the global GDP will take a hit of about 600 billion USD
by the year 2021. World trade is a vital element in the growth of the global economy. The
impact of this US-China Trade War would be so intense that it would affect the households,
businesses, and other wider economies
The trade war has prompted some companies to shift their production and sourcing away
from China and the United States to other countries to avoid tariffs. This has resulted in trade
diversion, with countries such as Vietnam, Mexico, and Taiwan experiencing increased
export opportunities as businesses seek alternative manufacturing bases.
The trade tensions have raised uncertainty among businesses, investors, and financial
markets worldwide. Uncertainty over future trade policies, potential escalation, and the
unpredictability of negotiations have led to caution in investment decisions, reduced global
trade and investment flows, and increased market volatility.
The trade war has affected commodity markets, causing price fluctuations for goods such as
agricultural products, metals, and energy resources. Tariffs and trade tensions have disrupted
established trading patterns, leading to shifts in demand, oversupply in certain markets, and
price fluctuations that impact producers, consumers, and commodity-exporting countries
However, on the good side, the trade war helps to redistribute the world supply chain,
making it less dependent and certain countries, like China, are a more sustainable
development opportunity for the world economy.
10. Impact for VN
- The US-China trade war certainly reduces the growth rate of the world economy. This will
lead to a decrease in the demand for Vietnamese exports.
- Second, tariff barriers from both sides of the US and China will make Vietnamese products
lose their advantages and reduce their competitiveness in the market due to high product
prices and inability to reach consumers.
- Third, The US-China trade war also has a strong impact on the financial - monetary market
of Vietnam. For example, the Vietnamese stock market after reaching a record in April/ In
2018, there appeared a strong downtrend with foreign investors continuously withdrawing
their net capital,…
5. In your opinion, which of the four theories (realism, liberalism, marxism and
constructivism) has the best explanatory and predictive power in IPE in general? Why
In my opinion, liberalism theory has the best explanatory and predictive power or the most
influential perspective in IPE.
Because:
- Whereas neo-mercantilists focus on the centrality of the state and Marxists view the world
in terms of class relations, liberals deal with a wide range of actors and levels of analysis.
- Firstly, in complex interdependence, multiple channels connect societies, there is no class
among issues and one government does not use military force against another.
- Secondly, liberals emphasize possible coordination among states. This is a very correct
point of view. The evidence can be seen that from 1945 until now there was not a major war.
- Thirdly, the role of international institutions. For example, the world bank, IMF, WTO. All
of them were established on the principle of liberalism. The development of (IMF) is proof, it
promotes global economic growth and financial stability, encourages international trade, and
reduces poverty.
- Finally, politics and economics have an interactive relationship. For example, a new tax
was impacted on Manchester, but it was very heavily defeated in a referendum=> A new tax
is rarely popular. This is a clear example about the relationship between politics and
economics.
6. In your opinion, should your country make alliances and trust allies
In the current globalization context, expanding relations between countries is very good, but
because cooperation is based on the interests of each side, it is difficult to fully trust an ally.
In my opinion, countries should not make alliances. Because according to realism, states
should avoid trusting allies completely because they can never be certain of other states'
intentions, as all states are fundamentally security-seeking. Politics is viewed as a zero-sum
game where one state's gain is another's loss. Therefore, countries should seek flexible
alliances to maintain a balance of power, remain prepared for potential conflicts to ensure
peace, and resist international efforts to impose global governance. A good example is the
UK's departure from the EU when it found its interests tied and made the European Union
upside down, illustrates how alliances can be disrupted, highlighting the realist view that
reliance on fixed alliances and international organizations can be risky.