Annotation #2- Vyju: This passage is suggesting that while globalization have helped many out of poverty, it has also deepened inequalities. Developing nations that have integrated into global markets have seen economic growth, but the benefits are often unevenly distributed suggested by the phrase "confront the fact that the global economy doesn't work as they thought it did". Wealth tends to concentrate in urban centers, leaving rural areas behind. Additionally, workers in low-income countries often face exploitation as multinational corporations seek the cheapest labor costs. A question that arises from this passage is: How can global trade policies be structured to ensure that economic development benefits all sectors of society rather than just a select few? This is relevant to the inquiry question of the relationship between trade and development because trade is a major driver of development, but without safeguards, it has the possibility of strengthening present inequalities rather than decreasing them. While trade aids economic expansion, it suggests that generosity goes hand in hand with development and should include equitable access to resources, fair wages, and protections for vulnerable populations. According to the United Nations Development Programme (2021), “Inclusive Growth & Innovation,” policies like fair trade agreements, labor rights protections, and investments in rural infrastructure can help account for the difference in economic growth and social development.

Citation: Inclusive Growth & Innovation. (n.d.). Retrieved from https://www.undp.org/egypt/inclusive-growth-innovation

Annotation #3-Vyju: This passage is suggesting that the COVID-19 pandemic has not only disrupted supply chains but has created geopolitical shifts. Countries that were better prepared like China used their position to strengthen global influence by controlling medical supplies and helping struggling nations, inadvertently, shaping their development and expanding their own influence. Meanwhile, the United States and European nations faced internal struggles due to their lack of preparation and reliance on foreign suppliers. This passage changed my perspective on the relationship between economic preparedness and geopolitical power. I had not previously considered how controlling supply chains could become a form of diplomatic leverage. This made me realize how the ability to supply essential goods in a crisis is not just an economic advantage but is also a tool for influencing global politics. According to an analysis by Richard Haass (2020), "The Pandemic Will Accelerate History Rather Than Reshape It," published in Foreign Affairs, the crisis reinforced existing global power structures rather than overturning them. He highlighted that China’s ability to recover quickly and provide aid to other countries has strengthened its power post-pandemic. Meanwhile, some Western countries struggling with internal supply chain failures have lost some of their credibility globally. This suggests that beyond economic resilience, nations must consider how supply chain strategies impact their broader political influence. This also relates to our question discussed in class on the relationship between trade and development by suggesting that their interdependent, when trade gets cut off, reliability of that nation decreases, curtailing its global influence. But it also suggests that nations that are better developed are less impacted by Covid-19 and are still able to trade, therefore, strengthening its power post-pandemic.

Citation:

Haass, R. (2024). The Pandemic Will Accelerate History Rather Than Reshape It. Retrieved from https://www.foreignaffairs.com/articles/united-states/2020-04-07/pandemic-will-accelerate-history-rather-reshape-it

Vyju - Annotation #1: This author of this article is saying that the impact of Covid-19 on almost every country around the world, display the interdependence of their economies. Had these countries' economies not been reliant on each other, than travel would significantly decrease since a main motivator for travel is jobs and economics. According to the Statistica Research Department, the number of tourists worldwide arriving in Asia and the Pacific rose steadily from 2005 to 2019 before a sharp decline, in tourism to all regions afterwards (2025). This data supports the claim made by this passage that Covid-19, due to the interdependence of global economies, didn't solely effect its region of origin (Asia), but travel to all regions (europe, america, and africa) as well. Global economies are so dependent on each other that if one component fails to be delivered on time, take the example of the forced suspension of production of small electronics in Italy, the production of goods in other economies also fail to be delivered in time due to the "just-in-time" supply chain. This relates to our topic question of the relationship between trade and development by suggesting that as nations' economies develop, hence becoming more globalized, trade becomes more dependent on other nations, so that they're able to focus and specialize in a particular field.

Statista. (2025, January 22). Number of international tourist arrivals worldwide 2005-2024, by region. https://www.statista.com/statistics/186743/international-tourist-arrivals-worldwide-by-region-since-2010/

Annotation #3: This passage made me realize that while technological innovation has historically solved many environmental challenges, it may not always be a reliable solution for climate change. Although I previously thought that economic growth and technological advancement would naturally lead to solutions for environmental problems, this epiphany was that waiting for future technology to fix climate change could be dangerously shortsighted. Murphy’s argument suggests that concerns over climate change might be overblown, just as worries about urban horse manure were rendered irrelevant by the invention of the automobile. This aligns with Julian Simon’s theory that human ingenuity will always find ways to overcome resource limitations. However, Jeffrey Sachs warns that this logic might not apply to climate change, as its impacts—rising sea levels, extreme weather, and biodiversity loss—could be irreversible by the time effective solutions emerge. This realization relates to the inquiry question, "How does economic growth affect the environment?" because it forces me to reconsider whether economic expansion alone can resolve environmental degradation. If economic growth relies on fossil fuels and unsustainable resource extraction, delaying action in hopes of technological breakthroughs could make environmental damage worse, rather than alleviating it. The lesson from past environmental challenges (such as ozone depletion, which required immediate regulation through the Montreal Protocol) is that early intervention is often necessary, rather than assuming future technologies will fix the damage.

Annotation #2: Murphy describes climate change as a negative externality, a foundational concept in environmental economics. A negative externality occurs when an economic activity causes harm to a third party who is not directly involved in the transaction. This concept was first formalized by Arthur C. Pigou in The Economics of Welfare (1920), where he proposed government intervention (such as Pigovian taxes) to correct market failures.

Murphy acknowledges that greenhouse gas emissions impose significant external costs but does not explicitly endorse strong government action. In contrast, Nicholas Stern (2006) describes climate change as the greatest market failure in history, justifying significant government intervention to reduce emissions. The European Union's Emissions Trading System (EU ETS) is an example of a policy designed to internalize these externalities by putting a price on carbon.

However, Ronald Coase (The Problem of Social Cost, 1960) provides an alternative perspective, suggesting that if property rights are well-defined and transaction costs are low, private bargaining could solve externality problems without government intervention. Some scholars argue that carbon credit markets (a market-based approach rather than taxation) could achieve similar environmental protections while maintaining economic efficiency. This discussion of negative externalities makes me wonder how governments should balance economic growth with environmental protection? And if market mechanisms (like cap-and-trade) should be preferred over direct regulation and if one has more negative externalities than the other? Lastly, it also raises the question on if economic growth can continue without worsening climate change, or it's an unavoidable tradeoff? This passage ties relaytes to the inquiry question because it talks about whether policies designed to prevent environmental harm are necessary, or if they would unnecessarily slow economic growth while not providing enough benefits.

Annotation #1: Murphy suggests that despite climate change, future generations will still be wealthier than the present one. He implies that strict climate policies may be unnecessary because economic growth will continue to improve overall well-being, even if environmental degradation occurs. This argument is rooted in classical economic theories, particularly those proposed by William Nordhaus, who argues for a gradualist approach to climate policy where economic sacrifices today should be balanced against the wealth of future generations (Nordhaus, The Climate Casino, 2013). However, Nicholas Stern, argue that economic growth cannot be taken for granted in a world with severe environmental degradation. In The Stern Review on the Economics of Climate Change (2006), Stern warns that unchecked climate change could actually slow economic growth by reducing agricultural output, increasing natural disasters, and displacing populations. Murphy’s statement also relates to our class discussion question on does economic growth inherently compensate for environmental damage? He suggests that a possible answer to this is that wealth accumulation will offset climate impacts; this is supported by research from the United Nations Environment Programme that argues that beyond a certain point, environmental degradation leads to diminishing economic returns, particularly in developing countries (UNEP Global Environment Outlook, 2022). Murphy's perspective supports the idea that economic growth can continue despite environmental harm, but other economists warn that the negative externalities - environmental damage - could ultimately undermine the very economic progress he assumes.

Annotation #1

Quote: "Institutions are the key to economic growth because they determine the incentives for savings, investment, and innovation."

Thoughts: This quote is saying that it isn't just the amount that you invest but also the institutions that govern these investments that contribute to economic growth. In other words, it adds another layer to the Solow model we discussed in class, which is how capital investments are managed in an economy. According to North (1990), who received the Nobel Memorial Prize in Economics, institutions shape the rules of the game in society and significantly impact economic performance. While this aligns with our class discussion of the Solow growth model, which assumes that economies grow through capital accumulation and technological innovation, with each round of investment decreasing in value to economic growth, it supports the claim made in this article by suggesting that institutional frameworks govern how effectively these factors operate. Our discussion in class, working to answer the question of what are the sources of Singapore’s success also supports this idea. Based on the reasoning in this quote, one of the reasons for Singapore's economic growth is its pro-investment policies into education and medical institutions that prioritize long term benefits.

Citation: North, D. C. (1990). Institutions, institutional change, and economic performance. Cambridge University Press.

Annotation #2

Quote: "Capital deepening alone cannot sustain long-term growth; technological innovation and institutional improvements are equally critical."

Thoughts: This section elaborates on the idea that the Solow model doesn't account for the effectiveness of capital investments in economic growth, by suggesting that it's how this capital investment is used - to develop technology and invest in institutions that will provide long term benefits - that will ensure its effectiveness. This raises a question: How do institutions evolve to foster innovation in countries transitioning from low to high-income status? In class, we discussed a possible answer to the question about what are the sources of SGs economic development, with one possible answer being Singapore's investments into educational institutions that help to foster innovation. However, this led me to wonder if these strategies be applied in countries like Ghana, where institutional weaknesses impede economic progress, or does their success depend on specific historical and political contexts? Additionally, this also makes me want to understand if it might be impossible for some countries to have economic growth in the long term because of corruption that might prevent capital investments from being directed to institutions and technology. Would institutions be beneficial in prompting economic growth if the governing of the institution is corrupt?

Annotation #3:

Quote: "Geography is not destiny; countries with unfavorable geographic conditions can still achieve economic prosperity through sound policies and institutional reforms."

Thoughts: Despite what teh article suggested about all three factors - culture, institutions, and geography - playing an important role in a countries' economic growth, this quote suggests that they can be substituted/made up for by one another. I found this quote extremely interesting since based on the geography theory Singapore should be poorer than many temperature regions solely because it has a tropical climate; however, this isn't true with SG being one of the wealthiest nations in the world. This made me realize that Singapore was able to overcome geographic disadvantages (limited land, no natural resources) through integration into global trade networks and institutional reforms, which is what made them grow economically. In other words, even if their geographic location gave them a disadvantage, their cultural values and institutions enabled them to overcome this. This also supports our discussion in class relating to our inquiry question - What are the sources of Singapore's economic development? - about how Singapore was able to grow rapidly by suggesting that because of its smart capital investments that resulted in growth following the Solow Model. The argument in this article, shown in this quote, challenged my previous assumption that most tropical regions were poorer on average compared to temperate regions because a nation must have all three factors - cultural values, institutions, and geography- for them to succeed with no exceptions.