Today’s Warm Up

Pick up the new warm up/exit ticket sheet by the turn-in tray

Briefly describe “brain drain” and provide one pro and one con.

Why Some Nations Are Rich … and Some Are Poor

Today’s LEQ: How does international free trade stimulate economic growth?

Intro…

Debate on globalization often centers on why some nations are rich while others stay poor Wealth impacts standard of living!

Key to economic prosperity = long-term economic growth

So…………………

What then…………………

… explains the differences among nations in long-term economic growth???

Key to Economic Growth? High investment in physical and

human capital Greater economic freedom

Lower taxes Fewer gov’t regulation Sound monetary policy Private property rights Decentralized decision-making (in most

economic sectors)

Key to Economic Growth? Strong incentives to save, invest,

and increase productivity Competitive markets Low inflation Political stability***Free trade***

Activity 1

In groups of 3, you will guess the nations based on the data provided then rank them from richest to poorest.

Be prepared to report your findings to the class & explain why you ranked the countries as you did.

From Rich to Poor…

Singapore (E) Japan (B) Argentina (A) Russia (D) Nigeria (C)

Think…

How can some nations with few natural resources, such as Japan and Singapore, be relatively wealthy?

How can other nations with vast amounts of natural resources, such as Nigeria and Russia, be relatively poor?

Natural Resources Paradox Natural resources does contribute to

economic success but… Many nations have enjoyed vast

economic success with relatively few resources & vice versa

Think: What other factors may come into play when it comes to a country’s economic success?

Free Trade

The highest income nations are heavily involved in world trade

Trade leads to specialization (countries focus on production and export of g/s they can produce at lowest opp. cost)

Specialization leads to greater productivity and prosperity!

Prosperity = higher standard of living!!!!WOOHOO!!!

Today’s Exit Ticket

Answer on your warm up/exit ticket sheet:

How important are natural resources to a nation’s wealth?