1. Aim: How does economic interdependence affect countries around the world?
Do Now:
Current Events Presentations
Have you ever traded part of your lunch for a part of someone else’s lunch? Why?
Homework:
Continue working on Current Event Presentations – refer to schedule

2. Do Now:
Have you ever traded part of your lunch for a part of someone else’s lunch? Why?

3. Economic Interdependence
At the beginning of the twenty-first century, the world was divided over a number of political, cultural, and economic issues.
Despite divisions, countries tied together like never before
Globalization is force behind closer relationships
Process in which trade, culture link countries
Improvements in transportation, communication make global trade easier
Globalization
Major effect of global trade, increased economic interdependence
Relationship among countries in which they depend on each other for resources, goods, services
Occurs because countries vary in goods, services they provide, need
Interdependence

4. Economy
Goods, services nation provides and needs depend on the level of economic development in that country
Countries grouped in two categories: developed, developing
Developed
Industrialized nations have strong economies, high standards of living
20 percent of world’s nations wealthy, powerful like Japan, United States
Have access to good health care, education, technology
Developing
Less productive economies, lower standard of living; Guatemala, Philippines
People in these countries lack adequate education, health care
Poorest, least-developed countries located mostly in Africa, southern Asia

5. Growth and Outsourcing
Multinational Corporations
Increasing interdependence and dramatic growth of multinational corporations—large companies operating in multiple countries

6. Growth and Outsourcing
Benefits to companies
Outsourcing—having work done elsewhere to cut costs, increase production
Manufacturing facilities in developing countries, where materials, labor relatively inexpensive

7. Growth and Outsourcing
Advocates say: creates jobs and wealth in developing countries
Critics say: fails to improve standard of living, outsourcing causes job loss in company’s home country

8. Global Economic Ties Global Economic Ties
Certain events, actions can affect economies of many nations
Global interdependence particularly evident in times of uncertainty
Early 2000s, price of crude oil rose dramatically
Factors: rising world demand, concern over available supply
Oil Prices
All countries depend on oil for energy; rise in prices felt around world
Developed countries like United States faced with higher costs
Poor nations in Africa could not afford to import, faced shortages
Rise in oil prices led to increased demand for alternative energy sources, attempts to reduce consumption

13. How does economic interdependence affect the world?
Sum It Up!!!!
How does economic interdependence affect the world?
Answer(s): helps to provide jobs in developing countries, increases production and decreases cost for multinational companies