Facts and Fiction about Globalization

Facts and Fiction about Globalization
Test your knowledge about the economics behind globalization in my
Globalization Quiz

Version 1.2 / family edition / (c)2005 by Tilman Slembeck, University of St.Gallen and Zurich University of Applied Sciences / Switzerland

Copyright notice: This material may be used freely for academic and commercial purposes provided that the author (Tilman Slembeck) and the web source (www.slembeck.ch) are fully quoted.

For each of the following 10 statements indicate whether you believe it to be correct or wrong by checking the appropriate box. Please explain your answer shortly in words. (In case your answer is based on simple prejudice, no explanation is needed.) ¦ Download this quiz as PDF document . ¦ I cannot wait to see the answers -> click! ¦

1.

correct

wrong

The more goods and services a country exports and the less it imports, the better it is for the economy of that country.

Rationale

2.

correct

wrong

When an economy grows and the country gets richer, this can happen only at the expense of some other country (or countries) that become poorer.

Rationale

3.

correct

wrong

Only the rich and strongly developed countries can participate in and benefit from globalization, since the poor and less developed countries are too weak to profit from globalization.

Rationale

4.

correct

wrong

Globalization is a process in which rich countries enrich themselves by exploiting poor countries more and more.

Rationale

5.

correct

wrong

The effect of globalization is that the poor become even poorer while the rich always get richer.

Rationale

6.

correct

wrong

A main reason why less developed or poor countries suffer from globalization – and, thus, cannot benefit from it – is that globalization leads to ruinous competition. Therefore, poor countries will benefit from restrictions on global competition.

Rationale

7.

correct

wrong

International trade should be restricted since its enormous increase over the past decades severely harms poor developing countries.

Rationale

8.

correct

wrong

Globalization is a relatively young phenomenon that has emerged only recently.

Rationale

9.

correct

wrong

The rich developed world is able to maintain its wealth and high living standards only if other countries remain poor (since rich countries can profit from the cheap products coming from the third world and continue to exploit poor countries).

Rationale

10.

correct

wrong

Globalization leads to a shift of production towards “low wage” countries. Therefore, the “high wage” countries of the western world are running out of labor to the effect that unemployment will increase dramatically and persistently.

Rationale

Congratulations ! Now that you have thought about all these important questions concerning globalization, you are probably anxious to get some answers and explanations.

As you may already guess, all of the above statements are largely wrong if you happen to ask an economist (like myself). Click here to learn why .

Besides: If you found 7 or more of the statements to be correct you have fallen prey to some of the most popular fallacies about globalization. If you found all statements to be correct without being able to give some rationale, you are likely to be an anti-globalist.

Page (c)by Tilman Slembeck / March 2005 ¦ Top of this page ¦ Back to Main Page ¦

1.	correct	wrong
The more goods and services a country exports and the less it imports, the better it is for the economy of that country.
Rationale

2.	correct	wrong
When an economy grows and the country gets richer, this can happen only at the expense of some other country (or countries) that become poorer.
Rationale

3.	correct	wrong
Only the rich and strongly developed countries can participate in and benefit from globalization, since the poor and less developed countries are too weak to profit from globalization.
Rationale

4.	correct	wrong
Globalization is a process in which rich countries enrich themselves by exploiting poor countries more and more.
Rationale

5.	correct	wrong
The effect of globalization is that the poor become even poorer while the rich always get richer.
Rationale

6.	correct	wrong
A main reason why less developed or poor countries suffer from globalization – and, thus, cannot benefit from it – is that globalization leads to ruinous competition. Therefore, poor countries will benefit from restrictions on global competition.
Rationale

7.	correct	wrong
International trade should be restricted since its enormous increase over the past decades severely harms poor developing countries.
Rationale

8.	correct	wrong
Globalization is a relatively young phenomenon that has emerged only recently.
Rationale

9.	correct	wrong
The rich developed world is able to maintain its wealth and high living standards only if other countries remain poor (since rich countries can profit from the cheap products coming from the third world and continue to exploit poor countries).
Rationale

10.	correct	wrong
Globalization leads to a shift of production towards “low wage” countries. Therefore, the “high wage” countries of the western world are running out of labor to the effect that unemployment will increase dramatically and persistently.
Rationale