Name: Jonathan Tran

Durham, Yvonne, et al. “Do the Rich Get Richer and the Poor Poorer? Experimental Tests of a Model of Power.” The American Economic Review, vol. 88, no. 4, 1998, pp. 970–83. JSTOR, http://www.jstor.org/stable/117014. Accessed 28 Mar. 2023.

How do free trade agreements and migration influence development? This journal article talks about how an increase in migration influence from underdeveloped countries to developed countries generally leads to increase inequality because migrants generally are willing to work for less for low skilled jobs.

Name:Jonathan Tran

Kim, Jongsung. “Income Inequality In China.” The Journal of East Asian Affairs, vol. 24, no. 2, 2010, pp. 29–50. JSTOR, http://www.jstor.org/stable/23258213. Accessed 28 Mar. 2023.

This article talks about how income inequality has developed in China, and according to this article, generational wealth is a growing part of it.

Name: Jonathan Tran

Game theory is a mathematical framework used to analyze and understand the behavior of individuals or groups when they are faced with strategic decisions. It is often used in economics, political science, psychology, and other fields where individuals' decisions are affected by the decisions of others.

One of the key concepts in game theory is interdependence, which refers to the fact that the outcome of one person's decision depends not only on their own actions but also on the actions of others. Interdependence can arise in many situations, including economic markets, social networks, and political negotiations.

https://www.researchgate.net/publication/340463241_The_instability_of_globalization_applying_evolutionary_game_theory_to_global_trade_cooperation

Name: Jonathan Tran

Inquiry Question: What is the relationship between trade and development?

From this quote, we can conclude that trade and development are positively related. As we see in China, they were able to export large quantities of masks, which increased GDP and development.

After Russian President Vladimir Putin launched a full-scale invasion of Ukraine last week, U.S. President Joe Biden made good on his threat to impose “swift and severe consequences” on Russia’s economy.

Name: Jonathan Tran

One example of a similar event instance would be when the United States, along with several other Western countries, imposed economic sanctions on Iran in 2018. The move was in response to Iran's continued development of its nuclear program, which was seen as a threat to global security. The sanctions targeted key sectors of the Iranian economy, including oil exports, banking, and shipping, and were designed to put pressure on the Iranian government to change its policies. This had a significant impact on Iran's economy, leading to a sharp decline in oil exports and a currency crisis.

Source: https://home.treasury.gov/policy-issues/financial-sanctions/sanctions-programs-and-country-information/iran-sanctions/may-2018-guidance-on-reimposing-certain-sanctions-with-respect-to-iran

These sanctions, coupled with similar measures from the European Union and other U.S. allies, will accelerate Russia’s isolation from the global economy. Such moves, however, are not a sign of policy success—despite the impressive transatlantic diplomacy. On the contrary, they represent a failure to deter Putin from invading Ukraine. It is possible that the threat of sanctions failed because Putin was determined to invade regardless of the cost. It is also possible that Putin underestimated the damage that Western sanctions would cause. The 2014 measures sent Russia’s economy into a tailspin, but the country stabilized after several years.

Name: Jonathan Tran

Free international financial markets can have a significant impact on national economies and the global economy as a whole. In the case of the economic sanctions imposed on Russia, they demonstrate how the actions of one country can have ripple effects across the global economy. When the United States and its allies imposed economic sanctions on Russia in response to the country's invasion of Ukraine, it had a significant impact on Russia's economy, leading to a sharp decline in its currency value and a contraction of its economy.

However, as noted in the statement, such measures do not necessarily guarantee policy success. In the case of Russia, while the sanctions led to a significant economic downturn, they ultimately did not deter Putin from his actions. This highlights the complex and interconnected nature of the global economy, as well as the limitations of economic sanctions in achieving policy goals.

Inquiry Question: How do free international financial markets affect national economies and the world economy?

This reminds me of the free rider problem, the burden on a shared resource that is created by its use or overuse by people who aren't paying their fair share for it or aren't paying anything at all.

Kim, Oliver, and Mark Walker. “The Free Rider Problem: Experimental Evidence.” Public Choice, vol. 43, no. 1, 1984, pp. 3–24. JSTOR, http://www.jstor.org/stable/30023863. Accessed 3 Feb. 2023.

In Unit 4, we also discovered that contributing to sustaining the quality of the environment is, to some extent, a public good, and that there are strong self-interested motives to free ride on the activities of others. So, while everyone would benefit if we all contributed to protecting the environment, we often do not do our part.

Name: Jonathan Tran

This reminds me of the tragedies of the commons, where a situation in which individuals with access to a public resource (also called a common) act in their own interest and, in doing so, ultimately deplete the resource.

Feeny, David, et al. “The Tragedy of the Commons: Twenty-Two Years Later.” Human Ecology, vol. 18, no. 1, 1990, pp. 1–19. JSTOR, http://www.jstor.org/stable/4602950. Accessed 3 Feb. 2023.

In the eighteenth and nineteenth centuries, legendary schooners such as the Bluenose (Figure 20.2) raced back to port to sell their catch to be the first on the market, and to offer fresh fish. By the late twentieth century, the Grand Banks had sustained the livelihoods of the US and Canadian fishing communities for 300 years.

Name: Jonathan Tran This connects to the book "Principles for Dealing with the Changing World Order: Why Nations Succeed and Fail" by Ray Dalio. A result of changing world order, the order of the wealthiest countries, has typically been the result of war. Most recently, the American World Order has established the US as the leading country of wealth with the end of WW2 and the proclamation of the USD as a reserve currency in the Bretton Woods Agreement. This is why there hasn't been much of a dramatic shift in the world order for the past "fifty years" because there has been no major conflicts.

"If you went back fifty years, the countries in the top and bottom thirty wouldn’t be greatly different. Singapore and South Korea would not be among the richest countries, and there would be several different countries in the bottom thirty, but the overall picture that emerged would be remarkably consistent with what we see today. Go back one hundred years, or a hundred and fifty, and you’d find nearly the same countries in the same groups."

Name: Jonathan Tran This connects to the book "Singapore is not an island" by Bilahari Kausikan, a Singaporean retired academic, diplomat and civil servant who served as Singapore's Permanent Representative to the United Nations between 1995 and 1998. In his book, he wrote furiously about the significance of geography to a nation's adopted political systems to scoff at questioners who dare ask something along the lines of "Why Singapore can't be more like scandinavian countries?". Singapore has been able to compensate its lack of natural resources with its strategic location in South East Asia.

Here is an article with Bilahari Kausikan that answers the question: What causes economic growth and development? Essentially, what causes the economic growth and development of a nation is its ability to adapt to the world order with the resources (whether geographical, natural, human, capital, etc) available to it.

https://mothership.sg/2018/10/asean-us-china-relationship-economic-bilahari-kausikan-eria/

One widely accepted theory of the causes of world inequality is the geography hypothesis, which claims that the great divide between rich and poor countries is created by geographical differences. Many poor countries, such as those of Africa, Central America, and South Asia, are between the tropics of Cancer and Capricorn. Rich nations, in contrast, tend to be in temperate latitudes. This geographic concentration of poverty and prosperity gives a superficial appeal to the geography hypothesis, which is the starting point of the theories and views of many social scientists and pundits alike. But this doesn’t make it any less wrong.

Name: Jonathan Tran This connects to the book "Principles for Dealing with the Changing World Order: Why Nations Succeed and Fail" by Ray Dalio. A result of changing world order, the order of the wealthiest countries, has typically been the result of war. Most recently, the American World Order has established the US as the leading country of wealth with the end of WW2 and the proclamation of the USD as a reserve currency in the Bretton Woods Agreement. This is why there hasn't been much of a dramatic shift in the world order for the past "fifty years" because there has been no major conflicts.

"If you went back fifty years, the countries in the top and bottom thirty wouldn’t be greatly different. Singapore and South Korea would not be among the richest countries, and there would be several different countries in the bottom thirty, but the overall picture that emerged would be remarkably consistent with what we see today. Go back one hundred years, or a hundred and fifty, and you’d find nearly the same countries in the same groups."

Name: Jonathan Tran This connects to the book "Singapore is not an island" by Bilahari Kausikan, a Singaporean retired academic, diplomat and civil servant who served as Singapore's Permanent Representative to the United Nations between 1995 and 1998. In his book, he wrote furiously about the significance of geography to a nation's adopted political systems to scoff at questioners who dare ask something along the lines of "Why Singapore can't be more like scandinavian countries?". Singapore has been able to compensate its lack of natural resources with its strategic location in South East Asia.

Here is an article with Bilahari Kausikan that answers the question: What causes economic growth and development? Essentially, what causes the economic growth and development of a nation is its ability to adapt to the world order with the resources (whether geographical, natural, human, capital, etc) available to it.

https://mothership.sg/2018/10/asean-us-china-relationship-economic-bilahari-kausikan-eria/

One widely accepted theory of the causes of world inequality is the geography hypothesis, which claims that the great divide between rich and poor countries is created by geographical differences. Many poor countries, such as those of Africa, Central America, and South Asia, are between the tropics of Cancer and Capricorn. Rich nations, in contrast, tend to be in temperate latitudes. This geographic concentration of poverty and prosperity gives a superficial appeal to the geography hypothesis, which is the starting point of the theories and views of many social scientists and pundits alike. But this doesn’t make it any less wrong.

Name: Jonathan Tran “Maynard Keynes recognized “money illusion”— the tendency to think of money in nominal rather than in real terms—and used it in his proposed solution to unemployment.” -- in this period of high inflation, this is the perfect environment for money illusion to run rampant. In addition, with this added stress, people will likely resort to a system 1 mode of thinking, making them even more vulnerable.

https://www.wsj.com/articles/inflation-money-illusion-11634049585

Name: Jonathan Tran “He also recognized that many of our long-term investments reflect “animal spirits”—intuitions and emotions—not cool-headed calculation.” -- Inquiry Question: How did capitalism revolutionize the way we live? -- Capitalism has created a self-adjusting system to account for our irrationalities in the long run. With market booms and busts, they all eventually adjust to equilibrium.