In Rodrik's international labor flow model, how many years are foreign workers allowed to work in another country?
a. 2
b. 4
c. 5
d. 7
e. 10
As described by Wade, how did the Basel II standard of capital adequacy contribute to the crisis?
a. It marked a shift from external regulation of banks to self-regulation.
b. It encouraged banks to lower capital standards during periods of illiquidity.
c. It lowered the cost of finance for banks in the global south relative to those in the developing world.
d. It required banks to use agencies' risk assessment models but assign their own ratings to market assets.
e. It did not contribute to the crisis but instead pushed a more responsible level of external regulation of banks.
According to Rodrik, those who view global integration as the prerequisite for economic development respond to the disappointing outcome of deep liberalization by suggesting that
a. getting benefits from openness requires a full complement of institutional reforms.
b. full openness is never the goal but must be tempered with some tariffs and quotas to protect domestic industry.
c. the growth resulting from deep liberalization still outstrips the growth that would result from any other model.
d. developing countries will achieve growth from trade liberalization at a slower rate than that of developing countries.
e. true openness has not yet been achieved; all tariffs and quotas and barriers to trade must be eliminated to see the kinds of returns promised by liberal economic theory.
According to Wade, which of the following was a weakness in the globalization modelwhich now may need rethinkingthat helped cause the crisis?
a. It placed too much emphasis on creating regional and domestic demand.
b. It overemphasized the demand side of the economy, pushing capital accumulation.
c. It overemphasized the supply side of the economyto the detriment of the demand side.
d. It overemphasized the demand side of the economyto the detriment of the supply side.
e. It de-emphasized the need for capital accumulation and thus left banks in a liquidity crisis.
What key area does Wade suggest should be watched in terms of gauging the robustness of governmental responses to the crisisan area that Warren Buffet described as financial weapons of mass destruction?
a. the securities market
b. foreign exchange rates
c. central bank inflation policy
d. the size of housing market assets held by banks
e. the market for over-the-counter derivative contracts
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