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Difficulty: HardThe Digital Revolution and Economic Globalization

“The new global economy is not delivering for working families. While technological advancements have connected the world like never before and created immense wealth for high-tech entrepreneurs, it has also facilitated a race to the bottom for millions of industrial workers. Multi-national corporations now use global communications networks to seamlessly shift manufacturing jobs to countries with the lowest wages and weakest environmental standards. The promise of the digital revolution was shared prosperity, but the reality for many is job insecurity, stagnant wages, and the erosion of the manufacturing sector that built the American middle class.”

— AFL-CIO representative, testimony before a congressional committee, 1999

Which of the following developments in the late twentieth century was a primary cause of the economic challenges described in the excerpt?

  1. The transition of the domestic workforce toward service-sector jobs and the offshoring of manufacturing.Answer
  2. B
    The migration of agricultural workers to urban centers to work in the nation’s first mechanized textile factories.
  3. C
    The adoption of mercantilist trade systems that prohibited commercial relations with foreign nations to protect colonial assets.
  4. D
    The federal government's nationalization of communications infrastructure to directly control wages and prevent outsourcing.

Answer

The transition of the domestic workforce toward service-sector jobs and the offshoring of manufacturing.
The correct answer is correct because the late twentieth century was characterized by a transition to a service-oriented economy and a decline in domestic manufacturing, as globalization and new technologies allowed corporations to offshore factory production to nations with lower labor costs.

Step-by-Step Solution

1
Analyze the stimulus passage.
The AFL-CIO testimony from 1999 critiques the impact of technological advancements and globalization, highlighting that multi-national corporations use communications networks to offshore manufacturing jobs to low-wage countries, resulting in stagnant wages and job insecurity for American industrial workers.
Understanding the core argument of the source helps isolate the specific economic trend being criticized.
2
Evaluate the historical developments of the late twentieth century that fit the context of the digital revolution and economic globalization.
During the late twentieth century, the U.S. economy transitioned away from manufacturing toward a service-oriented and knowledge-based economy. Free trade agreements and advancements in communication enabled corporations to offshore manufacturing tasks, leading to a decline in unionized industrial jobs.
Aligning the passage's complaints with actual historical events from Period 9.
3
Distinguish the correct option from the distractors based on chronology and economic theories.
The correct answer accurately captures the shift to service-sector jobs and offshoring. The other options describe the nineteenth-century Market Revolution, colonial-era mercantilism, or make historically inaccurate claims about government nationalization during a period of deregulation.
Eliminating options that are chronologically or conceptually incorrect.

Key Concept

The Shift to a Service Economy and Offshoring due to Globalization and the Digital Revolution
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Topics

The Digital Revolution and Economic Globalization

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