The Concept of Global Economy

1232 WordsFeb 26, 20185 Pages
This analysis begins by defining a couple of terms, the first of which is global economy. The global economy is the result of the development of an economy that rises above borders and is free moving between the different nation states of the world. A direct result of an economy that defies borders or governments is that it has openly called into question not only how much room governments have to maneuver but how much they can affect such an economy in the future. States are beginning to see themselves playing a diminished role when it comes to their own economies (Shively, 2012). Although this economic reallocation of power may be symbolic in nature it is representative of a loss of control not only in the economic arena but also potentially in the social arena as the concept of “globalization” takes a hold on the world. In this particular case, there are whole areas of economic policy in which states may wish to act on, but in the end is ultimately proven impossible for it to control. A state remains a state and its governments remain in power of said state however the range of things the state has the capacity to control is greatly diminished and part that diminishment can be seen as a diminishment of sovereignty. Essentially, the state is not challenged in its formal capacity when it comes to its governance of its population but is diminished in its abilities beyond physical borders. “With the development of a large and fluid world economy, the world’s investors and
Open Document