Economic Interdependence Between Countries And The Global Economy

“Development is about improving the quality of people’s lives, expanding their ability to shape their own futures”

How does global trade make us more interdependent? Global trade makes us more interdependent by the impacts of finance, trade, investment, technology and migration. Also, economic, social and environmental impacts. They affect the formulation and implementation of policies at the national, regional and global levels. Among significant impacts is the reduction in the degree of national autonomy in policymaking and the resulting need to better harmonize national policy formulation with international obligations, commitments and compulsions.

development have been political, social and cultural. President Museveni of Uganda likened the advent of

The 20th century brought with it a rapid expansion of the global interrelatedness of the world. In the beginning of the 20th century the world was dominated by a European world system of colonial empires that was created through expansion by sea (Findley, 2011). The competition between Britain and the other colonial powers led to an insatiable appetite to expand their empires across the globe (Findley, 2011). As the 20th century progressed this European world system collapsed and a new three world system of the United States, Soviet Union, and the rest of the world emerged (Findley, 2011). The end of the century coincided with a new era of globalization that was made possible by the introduction of global communication via the internet (Findley, 2011). This new technology brought the entire world closer together than it had ever been before. The four events that best illustrate the progression of global interrelatedness throughout the 20th century are the Great Depression, World War II, Cold War, and the introduction of instant global communications via the internet.

The liberal approach to free trade is heavily associated with the fundamentals of capitalism. Free trade is therefore beneficial to the minority who are capable of manufacturing their goods in societies that have more unskilled labourers and in turn can be compensated less. The labourers in the nations that have the technology to do something better but not necessarily cheaper are at the greatest disadvantage within a liberal free trade political economy.

Adam Smith, author of The Wealth of Nations, shows support for free trade and emphasises it as a trade policy which ought to be adopted. Krugman and Obstfeld back Smith's support by stating that the efficiency of trade is increased by free trade and accumulates the national income of countries. Free trade is a theory which suggests that each nation benefits in specialising in an economic activity from which it gains absolute advantage, enjoying absolute superiority over other nations in a specif economical activity (Peng). With free trade follows opportunity, replacing regulation and growth of economic activity. (Rugmann and Collinson).

There are many faces to development- both in how it is defined and in what constitutes it. In ‘Liberating the World from Development’, Sachs writes “The desire for equity is largely fixed on development-as-growth” (22). This is to say that development as a concept is conventionally hinged upon economic status and growth. This core assumption is present in the primary models of development, modernization and neoliberalism, both of which in turn offer their own implications and consequences. It is these consequences that inspire Sachs, and many others, to seek out a more comprehensive definition and approach to development.

Social, political and economic development have been and continue to be some of the greatest challenges for low income and least-developed states within the international community. “Development” can be explained in a variety of ways, including economic growth and purchasing power parity, but one of the best ways to illustrate development is described by Amartya Sen as the capability or opportunity to develop.

Economic globalization and economic integrations are possible due to embedded liberalism. In this system economic globalization is the interdependence of national economies as well as economic integration, which is the unification of economic policies (Wong, February 10th, 2014, lecture 16). Keynesian logic applied to international system via a counter-cyclical stimulus where governments only interfere according to the natural inflation and deflation of the market, as form of compromise between Adam Smith’s invisible hand of the market and List’s visible hand of government (Wong, January 27, 2014, lecture 14). The idea behind embedded liberalism is that it would create international

Amartya Sen defines economic development in terms of personal freedom, freedom to choose from a range of options. While economic growth may lead to an increase in the purchasing power of people, if the country has a repressed economy, there is lack of choice and hence personal freedom in restricted. Hence once again growth has taken place without any development. While economic growth may result in an improvement in the standard of living of a relatively small proportion of the population whilst the majority of the population remains poor. It is how the economic growth is distributed amongst the population that determines the level of development.

Development is defined as “the process of change operating over time- the process by which countries and societies advance and become richer’’. The modern 20th century defines development as” the process of change which allows all the basic needs of a region to be met, thereby achieving greater social justice and quality of life and encouraging people to fulfill their potential’’. Todaro defines development as “the process of improving the quality of all human lives through raising people’s living standards, their incomes, consumption levels of food, medical services, education, raising people’s self-esteem through the establishment of social, political and economic systems and institutions that promote dignity and respect and increasing people’s

The developmental state gives priority to economic growth rather than political reform. It is of strong ambition to develop economy;

In this book, Dobbs, Manyika, and Woetzel believe the world is almost constantly discontinued. Many long-held assumptions, long-term projections, and long-stand trends have been upended by disruptive technologies, trends, and developments. A completely different world is being formed by four main forces. The first force is the development of emerging markets and the growing urbanization within these markets (Cooper, 2015). The world economic power is moving to east and south. As an example, China is predicted to have most large companies located in rather than the United States or Europe by 2025. Equally important, economic activities are arising within these emerging markets. For instance, a Chinese city Tianjin, who had a same size GDP

The features of economic environment have direct relationship with economic activities .Income and wealth is the components of the economic environment.

Global interdependence never really crossed my mind when thinking about company’s and what they must go through. As I acquired knowledge about globalized companies in other classes, I never dove this deep into it like this class. Overall, this class has taught me a great deal about all aspects of a company from the management standpoint to the logistics that go into getting products to where they need to go. Global interdependence is a huge topic in every company and is a topic that must be perfectly in sync with the company’s beliefs to be successful overseas. Global interdependence includes changes, interconnectedness, and diversity.