Trade and Globalisation: NBSE class 10 social science

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Get here the notes/solutions/extras of NBSE Class 10 Social Science Chapter 4 Trade and Globalisation. However, the study materials should be used only for references and nothing more. The notes can be modified/changed according to needs.

Summary

Long ago, the world was a very different place. Countries and peoples lived in relative isolation from one another, separated by vast distances and formidable barriers. Trade and interaction between distant lands was limited and difficult. But that was all about to change, as humanity embarked on an accelerating journey towards an interconnected global world.

Our chapter begins in ancient times with the famous Silk Route – a network of trade paths that connected the great civilizations of China, India, Persia, Arabia, Greece and Rome. Along this route traveled not just precious silks and spices, but also ideas, cultures, religions and technologies. It was one of the first major conduits for globalizing influences across the continents.

As the centuries passed, other empires like the Islamic empires and the Mongols expanded trade and integration along these routes between Asia and Europe. When the Mongol reign ended, Europeans were motivated to find new sea routes to access the riches of the East. This ushered in an age of exploration and colonialism starting in the 16th century.

European powers like Spain, Portugal, Britain and France industrialized rapidly and carved up the world into their respective colonial empires. They sourced raw materials and labor from their subjugated territories overseas, while selling manufactured goods back to the colonized populations. This early form of economic globalization, however, was highly imbalanced and exploitative.

One dark element of this colonial system was the large-scale migration of indentured labor from India and China to work on plantations in the Caribbean, Africa and other colonies. Millions were shipped overseas under contracts of servitude, fleeing poverty and desperation back home. They created new composite cultures in their adopted lands through shared struggle.

The 19th century witnessed rapid industrialization and increasing trade volumes between nations. But it was also an era of European imperial conquests that forcibly integrated foreign societies into a globalizing capitalist system centered on Western economic interests.

Economic globalization proceeded rapidly in the early 20th century through innovations in transport, communications and mass production techniques pioneered by entrepreneurs like Henry Ford. This consumerist lifestyle first took root in America before going global later on.

But just as this wave of integration was gathering steam, the world plunged into the catastrophic Great Depression of the 1930s. It began with a devastating stock market crash in the US that rapidly spread economic misery and high unemployment worldwide through the intricate links of the global economic system.

The prolonged crisis shook faith in unrestricted capitalism. It was only resolved through national policy interventions like FDR’s New Deal in America. But more importantly, it underscored the need for new international institutional mechanisms to promote stability and prevent future global economic meltdowns.

Thus was born the idea of the Bretton Woods system after World War 2 – a framework of agreements, institutions like the World Bank and principles to govern post-war international monetary affairs. The advanced economies agreed to maintain fixed exchange rates and open their markets in a regulated fashion. This system underpinned the reconstruction and rapid economic growth of the mid-20th century.

However, the Bretton Woods system ultimately failed to be sustainable. Growing economic imbalances and loss of confidence in the US dollar triggered a shift to floating exchange rates by the 1970s. Developing countries were now forced to borrow heavily from private Western banks instead of public institutions.

This era of debt crises, structural adjustment and neoliberal policies in many poor countries ushered in a new phase of globalization from the 1980s onwards. The integration of globalized production through multinational corporations accelerated rapidly.

Skeptics critique this modern wave of globalization as being primarily driven by the profit motives of rich nations and their corporations, rather than the interests of developing countries. They argue it has increased inequality and disrupted local economies and traditions across the world.

In today’s hyperconnected world, our lives are intertwined with cultures, products and forces from all corners of the globe as never before. While it has unlocked unprecedented prosperity for some, the process of globalization still poses complex challenges and trade-offs that we must continue to navigate.

Important dates, years, and events

  • 16th-17th centuries – Portuguese and Spanish traders expanded exploration and trade globally after reaching the Americas
  • 1834 – Slavery abolished, leading to the system of indentured labor migration from India
  • 19th century – European colonial conquests and expansion of trade/markets
  • 1885 – Berlin Conference where European powers carved up Africa into colonies
  • Late 19th century – Growth of indentured Indian labor migration to Caribbean, Africa, Southeast Asia
  • Early 20th century – Innovations like assembly line and mass production take root
  • 1929 – The Great Depression begins with stock market crash
  • 1933 – FDR’s New Deal programs launched in the USA
  • 1944 – Bretton Woods Conference establishes IMF and World Bank
  • 1947 – IMF and World Bank become operational
  • 1970s – End of Bretton Woods system’s fixed exchange rates
  • 1970s-1980s – Debt crises in developing countries, rise of neoliberal policies
  • Late 20th century – Growth of globalized production by multinational corporations

Textual questions and answers

Multiple Choice Questions (MCQs) 

1. ‘The decision-making in the IMF and the World Bank is controlled by : 

(a) All the member-nations of these two banks
(b) Western industrial powers and the US’s right to veto over key IMF and World Bank decisions
(c) The Asian-African bloc
(d) A majority vote by all the nations 

Answer: (b) Western industrial powers and the US’s right to veto over key IMF and World Bank decisions 

2. Multinational Corporations (MNC’s) are 

(a) Foreign companies that flourish in the developing countries
(b) Large companies that operate in several countries at the same time
(c) Large companies that try to exploit small companies
(d) West European and Japanese companies which exploit the developing countries 

Answer: (b) Large companies that operate in several countries at the same time 

3. Read the following statements – Assertion (A) and Reason (R). Choose one of the correct alternatives given below : 

Assertion (A): The post-war reconstruction was marked by two crucial influences.
Reason (R): First was the emergence of US as a super power and second was the dominance of Soviet Union. 

(a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A)
(b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
(c) Assertion (A) is true but Reason (R) is false.
(d) Assertion (A) is false but Reason (R) is true. 

Answer: (a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A) 

4. What is the theme of the above picture? 

(a) Unemployment and poverty
(b) Globalisation
(c) Great Depression
(d) Fall in agricultural prices 

Answer: (c) Great Depression 

Very Short Answer Questions  

1. Name the pioneer of mass production of cars. 

Answer: Henry Ford 

2. What did the G-77 demand? 

Answer: They demanded a new economic order (NEO). This was a system which would give them real control over their natural resources, fairer prices for raw materials, and better access for their manufactured goods in developed countries’ markets. 

Short Answer Questions

1. Define globalisation. 

Answer: Globalisation is the increasing interconnection of people and places as a result of advances in transport, communication, and information technologies that cause political, economic, and cultural convergence. 

2. Define the term ‘migrant’. 

Answer: Migration is the act or process of changing habitat. 

3. List the chief features of the Bretton Woods system. 

Answer: The chief features of the Bretton Woods system were to adopt a monetary policy that maintained the exchange rate of its currency within a fixed value – plus or minus one per cent – in terms of gold and the ability of the IMF to bridge temporary imbalances of payments.

Long Answer Questions

1. Mention the two crucial influences that marked the post-war reconstruction. 

Answer: First was the US’s emergence as a dominant political, economic, and military power in the western world. Second was the dominance of the Soviet Union. It made huge sacrifices to defeat Nazi Germany and transformed itself from a backward agricultural economy into a world power when the world was trapped in the Great Depression. 

2. Examine why the Great Depression was a catastrophic event for the USA. 

Answer: The Great Depression was a period of unemployment, low profits, low prices on goods, high poverty, and a stand-still trade market that affected the entire world in the 1930s. It began around 1929 and lasted till the mid-1930s. The worst hit sectors were heavy industry, agriculture, mining, and logging. The stock market crash of 1929 did not cause the depression but it certainly increased the difficulty of recovery. The Depression ended in 1935 and caused major political changes. Most notably the New Deal that involved large scale federal relief programmes, aid to agriculture, support for labour unions, and the formation of the New Deal coalition by Franklin D. Roosevelt, President of the USA. 

3. Explain the causes of the Great Depression. 

Answer: The Depression happened due to many factors. First, agricultural overproduction was a problem which was made worse by falling agricultural prices. Farmers tried to expand production and bring a larger volume of produce to the market to keep up their overall income. This worsened the surplus in the market pushing down prices even further. Second, in the late 1920s, the price of shares in the USA had been forced up beyond their real value by reckless speculators. Then in October 1929, people started to sell shares rapidly, beginning an economic crisis that soon affected the whole world. Many people lost all their money. Banks and businesses closed, and unemployment began to increase. By 1932, 12 million people were unemployed in the USA alone. 

4. Explain the impact of globalisation. 

Answer: Outwardly it appears that globalisation has turned the world into a ‘global village’ but the ambition of developing countries to join the fraternity of developed nations has raised many problems of which poverty is the most wicked. Here we shall describe the impact of globalisation. It includes forced lifting of non-tax restrictions on international trade, cutting custom duties to international levels, developed countries’ objection to the free flow of labour, investment in sectors with short gestation periods and high returns regardless of the host country’s interest, adverse conditions associated with financial assistance to poor countries, reduction of government’s participation in the economic sphere, increased disparity of income and wealth distribution, and changed consumption patterns towards luxury goods, among other impacts. 

Extra MCQs

1. What has contributed to the making of a global world? 

A. Trade B. Migration C. Movement of capital D. All of the above 

Answer: D. All of the above 

2. What is globalisation? 

A. The isolation of countries B. The decrease of international trade C. The increasing interconnection of people and places D. The decline of cultural convergence 

Answer: C. The increasing interconnection of people and places 

3. What did Muslim traders establish in the Islamic Age? 

A. A local economy B. A regional trade system C. A global economy D. A national trade organization 

Answer: C. A global economy 

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60. Under what conditions can liberalisation produce better results? 

A. When there is political stability B. Only in highly industrialised countries C. When basic needs like education and healthcare are developed D. When there is a high rate of unemployment 

Answer: C. When basic needs like education and healthcare are developed 

Extra questions and answers

1. What is globalisation? 

Answer: Globalisation is the increasing interconnection of people and places as a result of advances in transport, communication, and information technologies that cause political, economic, and cultural convergence. 

2. What role did the Silk Route play in early forms of globalisation? 

Answer: The Silk Route served as a trade and cultural route that was central to cultural interaction through regions of the Asian continent, connecting East and West. It linked traders, merchants, pilgrims, monks, soldiers, nomads, and urban dwellers from China to the Mediterranean Sea, significantly impacting the development of the great civilizations of China, Egypt, Mesopotamia, Persia, and the Indian subcontinent and helping to lay the foundations of the modern world. 

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39. Evaluate the argument that globalisation’s impact on social welfare depends on the development of education and healthcare. 

Answer: The impact of globalisation on social welfare is mixed and significantly influenced by the level of development in education, healthcare, and human resources. In countries where basic needs are unmet and development in these areas is lacking, liberalisation and globalisation can exacerbate inequalities and lead to economic failure, as seen in Brazil. Conversely, in countries like China, where there has been significant investment in literacy, healthcare, and human resource development, globalisation has contributed to economic success and improved living standards. This suggests that the benefits of globalisation are contingent on foundational social and economic structures being in place to support and distribute its gains equitably. 

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