Deck 4: Political Economy

Question 1

The ways politics and economics interrelate and affect one another is called:

A) Domestic relations
B) Civil society
C) Free markets
D) Political economy

Answer 1

D

Question 2

Two leading scholars of political economy in the eighteenth and nineteenth centuries were:

A) David St. Hubbins and Derek Smalls
B) Adam Smith and Karl Marx
C) Thomas Hobbes and René Descartes
D) John Maynard Keynes and Milton Friedman

Answer 2

B

Question 3

The profits of a French firm operating in Senegal add to the GDP of (this state) and the GNI of (this state):

A) France, France
B) Senegal, Senegal
C) France, Senegal
D) Senegal, France

Answer 3

D

Question 4

The United States is an example of a country whose economy has:

A) Always been the leader in the world
B) Never been subjected to state regulation because it is free-market
C) Grown powerful and dynamic, but with variations in performance over time
D) Grown faster than that of Europe at each stage in the Twentieth Century

Question 5

The measure of income as adjusted to reflect the cost of living is called:

A) Purchasing power parity (PPP)
B) Per capita GDP
C) Consumer inflation percentage
D) Gini coefficient

Question 6

What is the name given by economists to a situation in which prices are rising?

A) Income inequality
B) Gini coefficient
C) Inflation
D) Intergenerational income elasticity

Question 7

The Gini coefficient is:

A) The measure of the total income of all of a country's citizens
B) The line below which people will be defined as poor
C) The percentage of eligible laborers who lack ongoing, regular access to paid work
D) The measure of income inequality in a given population

Question 8

If a country were to have a Gini coefficient of 0.95, it would be a _________ country.

A) Very equal country
B) Slightly equal country
C) Very unequal country
D) Slightly unequal country

Question 9

Which of the following would likely signify an individual who is underemployed?

A) A PhD who works as a custodian
B) A classically trained pianist who performs at children's birthday parties
C) A college graduate who interns at an investment bank
D) All of the above

Question 10

According to the text, drug dealers would likely be classified as:

A) Formally employed
B) Informally employed
C) Gainfully employed
D) Publicly employed

Question 11

Which of the following would constitute a very worrying economic problem when people stop buying because they are expecting prices to fall in the future?

A) Hyperinflation
B) Deflation
C) Underemployment
D) All of the above

Question 12

Which of the following would constitute a very worrying economic problem when prices are rising rapidly and people expect them to continue doing so in the future?

A) Hyperinflation
B) Hyper-deflation
C) Hyper-indebtedness
D) Hyper-fiscalism

Question 13

In general, a transaction between two or more private actors at a price they agree upon is called a:

A) State-led transaction
B) Market transaction
C) Consumer surplus transaction
D) Wall Street transaction

Question 14

A common role for the state in many free market economies is:

A) Guaranteeing contracts
B) Capping profits
C) Ensuring against caveat emptor losses by buyers
D) Establishing real values in secondary markets

Question 15

Which economist was among the first responsible for the theory that underpins the market-led development approach?

A) Amartya Sen
B) Karl Marx
C) Adam Smith
D) John Maynard Keynes

Question 16

Adam Smith's concept of the "invisible hand" refers to:

A) The idea that society benefits from economic efficiency and expansion generated by individual gains.
B) The idea that government should not interfere with the operation of the market.
C) The idea that government's role is to establish a rule of law and protect property rights.
D) All of the above

Question 17

Public choice theory is associated with the idea that:

A) Public officials choose policies that optimize economic performance
B) Public officials are self-interested actors who often impede markets
C) The public rationally chooses policies in its own interest
D) Too many choices for public policies

Question 18

Which twentieth-century academic argued that government intervention generally had negative consequences for economic growth?

A) Milton Friedman
B) Adam Smith
C) Thomas Friedman
D) Paul Krugman

Question 19

Unlike neoliberals, proponents of __________ believe that markets are unlikely to generate national wealth on their own.

A) State interventionism
B) Capitalism
C) Laissez-faire liberalism
D) Embedded autonomy

Question 20

National defense, basic infrastructure, and a healthy environment are examples of:

A) Welfare state services
B) Democratic tools
C) Public goods
D) Market institutions

Question 21

Modern states engage in taxing and spending, which is sometimes referred to as:

A) Monetary policy
B) Socialist policy
C) Social policy
D) Fiscal policy

Question 22

Policies of governments or public institutions help shape how much money is in circulation, and this is sometimes referred to as:

A) Monetary policy
B) Financial policy
C) Fiscal policy
D) Human capital policy

Question 23

Two main components of human capital are:

A) Monetary policy and fiscal policy
B) Financial capital and social capital
C) Education and health
D) State and market

Question 24

A country that was a leading example in demonstrating the potential successes of state-led development in the period after World War II was:

A) The United States
B) The United Kingdom
C) Japan
D) Nigeria

Question 25

Which of the following is associated with the interdependence between a population's health and educational levels:

A) Children eating a healthy diet generate long-term economic gains for a state.
B) An educated population is innovative and globally competitive.
C) Teaching people about their rights and duties attached to their status as citizens is an important function of education.
D) All of the above

Question 26

The welfare state that emerged in the Twentieth Century is based on which of the following principles?

A) The United States had "fared well" and should be emulated
B) The state should serve economic and social functions to maintain the population's welfare
C) People who are on welfare are abusing the system and they should compete in the labor market
D) The elderly and vulnerable should look primarily to private actors for support

Question 27

Prominent examples of reductions of the role of the state in the economy occurred in which of the following regions?

A) Western Europe after 1945
B) The Caribbean after 1960
C) Southeastern Asia after 1968
D) Eastern Europe after 1989

Question 28

The idea that cultural change led to the rise of welfare states follows which of logic?

A) Lack of effort on the part of welfare recipients gave rise to a permanent underclass
B) After World War II, Communism and fascism gave way to liberal welfare states
C) Over time, people increasingly saw the state as an actor that could resolve social problems
D) As one moves from tropical areas to temperate zones, cultures show more solidarity

Question 29

One basic argument about why capitalism gave rise to the welfare state is that:

A) Capitalist societies have complex institutional sets that lead to major roles for the state
B) Wealth and the commercial impulse makes people more peaceful toward one another
C) The United States, the leading capitalist country, was where the welfare state originated
D) Capitalism gave rise to the religious and community institutions that provide welfare

Question 30

Joseph Schumpeter's argument about the origins of the welfare state is most closely associated with which of the following?

A) Capitalism is successful; this generates social actors that then impose some socialism
B) Capitalism is disruptive; this generates social demands to make it more "livable"
C) Capitalism is successful; this generates social actors that then reinforce capitalism
D) Capitalism is disruptive; this eliminates social actors that would reinforce capitalism

Question 31

Karl Polanyi's argument about the origins of the welfare state is most closely associated with which of the following?

A) Capitalism is successful; this generates social actors that then impose some socialism
B) Capitalism is disruptive; this generates social demands to make it more "livable"
C) Capitalism is successful; this generates social actors that then reinforce capitalism
D) Capitalism is disruptive; this eliminates social actors that would reinforce capitalism

Question 32

A perspective on the welfare state that emphasizes mobilization and political action might argue which of the following are important in shaping outcomes?

A) Citizens who benefit from the welfare state are more likely to vote and secure their interests
B) Welfare states have made mobilization and political action more feasible for all
C) Welfare states may be a compromise among political interests, such as business and labor
D) Negotiations among bureaucrats determine which welfare recipients deserve which benefits

Question 33

A prominent scholar who argued that the variations in different forms of welfare states across capitalist countries in terms of class politics was:

A) Søren Kierkegaard
B) Mären Lündgren
C) Gøsta Esping-Andersen
D) Greta Garbø

Question 34

An important example of a policy from the last two decades that generated international learning effects in contemporary welfare states is was which of the following?

A) The Beveridge Report in the United Kingdom
B) The Moynihan Report in the United States
C) Bolsa Familia in Brazil
D) Balsa Flotilla in Mexico

Question 35

Which of the following is a valuable contribution to social science?

A) Formulation and generation of new hypotheses for future testing
B) Testing of hypotheses for purposes of theory building
C) Finding contrary evidence that disconfirms existing hypotheses
D) All of the above

Question 36

Which of the following constitutes most clearly demonstrates the logic of a hypothesis test?

A) Careful study and review of a case study done by a social scientist
B) Consideration of an argument a scholar had made in light of a new empirical case
C) Examination of "Insights" boxes and "Cases in Context"
D) Consideration of a new case study and formulation of possible explanations for that case

Question 37

What does the Gini coefficient measure?

Question 38

What is the difference between GDP per capita and GDP per capita "at PPP"? Identify the acronyms GDP and PPP in your answer.

Question 39

Identify the key arguments of the market-led approach to political economy.

Question 40

What is the argument behind the idea that the state can promote growth better than the market?

Question 41

What do critics of state-led approaches to growth say?

Question 42

What do critics of market-led approaches to growth say?

Question 43

What are some of the key tasks undertaken by a modern welfare state?

Question 44

What are some of the main categories of theories for why the welfare state emerged?

Question 45

Identify two or more reasons why capitalism may have contributed to the rise of the welfare state.

Question 46

In what ways might one country's welfare state differ from another country's welfare state?

Question 47

What are key variables in Gøsta Esping-Andersen's account of the emergence of different types types of welfare states?

Question 48

How does one use empirical evidence when generating or formulating a hypothesis?

Question 49

What are the main causes of climate change and how can we address them?

Question 50

If you had to select just one indicator to capture the success or health of a country's economy, what indicator would you select and why? Explain the advantages and limitations of the indicator you selected, contrasting it with at least two other economic indicators.

Question 51

Consider the market-based and state-centered approaches to political economy. How are they similar and how are they different? Which appears to have the strongest evidence supporting it?

Question 52

Many theorists argued that capitalism in the nineteenth and twentieth centuries gave rise to the welfare state. Do you expect capitalism will lead further increases in the welfare state in the twenty-first century? Why or why not? As countries learn from and compete with one another, what is the likely impact on countries' welfare states? To avoid relying on speculation, refer to existing theories and empirical cases as possible in your response.

Question 53

Describe how mobilization and political action might give rise to a welfare state, with particular focus on in the interests of business and labor groups.

Question 54

In what ways does the formulation or generation of hypotheses help advance social science? Describe how these processes contribute to the accumulation of knowledge about the world. What would be good practices in the formulation and generation of hypotheses?