Virginia’s Role in the Global Economy
OverviewVirginia has a rich history in trading goods with other countries. Because the global economy is a great deal more competitive than it was in Virginia’s early colonial history, Virginia’s governors, legislators, and business leaders have responded in many ways to assist the expansion of export markets for state businesses. In this activity, students will be introduced to the nature of world trade through a trade game simulation. Students come to understand that some countries have abundant resources, while others are in need of goods and services. The supply and demand for goods and services highlights the importance of trade and the need for global markets. In addition, students will examine charts from the Virginia Economic Development Partnership (VEDP) that provide the most recent data on Virginia’s exports. Through the analysis of this information, students will better understand the relationship of Virginia to the global economy.
Preparation for Global Trade Simulation
Print Handout #1: Global Trade Simulation Teacher Directions and obtain all the required simulation materials.
Follow instructions in Handout #1: Global Trade Simulation Teacher Directions, which explains how to make country folders and trading units that students will use to trade during the simulation.
Activity 1 Global Trade Simulation
Give students copies of Handout #2: Global Trade Simulation and Handout #3: Trade Game Score Tally Sheet.
Before trading begins, give students a chance to familiarize themselves with the directions and their resources, and prepare a strategy for trading with other countries.
Have students follow instructions in Handout #2: Global Trade Simulation to guide the trading process.
Activity 2 Group Discussion after the Simulation
After the simulation is complete, give teams time to complete Handout #4: Global Trade Simulation Group Debriefing Question. After teams have completed the handout, have a class discussion in which groups share their responses.
Distribute Handout #6: Primary Source Analysis Questions and Handout #7: Primary Sources Virginia Economic Development Partnership Data.After students have completed Handout #6, discuss the answers as a class.
For any country or state to survive in the global economy, it must actively take part in the trading of goods and services.
Virginia has a rich history in trading goods with other countries. Starting with Virginia's early colonial history by trading exports and imports for the British Empire, Virginia has grown greatly in trade with countries all over the world. While tobacco and other agricultural products contribute greatly to Virginia’s total export markets, industrial and other modern products have greatly increased Virginia's wealth and standing in the trading community.
By the 1980s, the global economy became a great deal more competitive. Virginia's governors, legislatures, and business leaders responded in many ways by helping Virginia grow in export markets.
All countries and states strive to achieve a favorable balance of trade. This is when a country's export values exceed its values of imports. When a country imports more goods and services than it exports, this is known as a “trade deficit."
Thankfully, Virginia has been on the upswing in the export markets for the last twenty years. Through a series of actions by the state government, and in partnership with the many firms and schools of business in the state university system, Virginia has surged in exporting its goods and services all over the world.
Why is global trade, especially exporting, so important? According to VEDP, the Foreign Trade Division of the Census Bureau, and the Bureau of Economic Analysis of the Commerce Department, Virginia's exporting facts include:
- As of February 2009, export-supported jobs accounted for 3.2% of Virginia's total private-sector jobs.
- As of 2006, over 15% of all manufacturing jobs in Virginia were dependent on export markets.
- In 2006, over 4,500 Virginia companies exported goods all over the world. 83% of these were small businesses which employed fewer than 500 workers.
- Foreign-controlled companies in Virginia employed one of every eight manufacturing workers.
- Virginia’s exports in 2008 totaled approximately $18.9 billion compared to the $12.6 billion in 2004.
- In 2005, Virginia ranked 23rd among the 50 states in exporting.
- According to the BEA, in 2007, Virginia's Gross Domestic Product (GDP) was approximately $382,964,000,000.
- Exporting directly contributes about 5% percent of the state's GDP. Spin-off economies and businesses that are related to the export markets add a great deal more to this figure ($18.9 billion divided by the GDP of Virginia).
As stated previously, Virginia is very active in the global economy.Trade is the lifeblood of any modern economy. Many states depend on Virginia's goods, and in turn we import billions of dollars worth of goods that help Virginians and Americans live better lives. At the same time, these exports and imports create billions of dollars of economic opportunity for our residents.The world market offers many goods and services that we can enjoy. The world also enjoys and buys many of the goods and services that our Commonwealth has to offer.
Virginia’s government has many state and private agencies to help large and small businesses participate in the ever-changing and increasingly competitive world market. Virginia Economic Development Partnership is one such agency as shown with the information provided. Students need to be aware that there are good jobs and career opportunities in the world of the global economy. Virginia's government agencies, school systems, and business partnerships help to better prepare the students to compete in the new economic era.
This lesson is designed for twelfth grade government classes on any level.