 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.

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

 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???

 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)

 Strong incentives to save, invest, and increase productivity  Competitive markets  Low inflation  Political stability  ***Free trade***

 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.

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

 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 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?

 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!!!

 Answer on your warm up/exit ticket sheet:  How important are natural resources to a nation’s wealth?