The Global Economy Essay

2066 Words 9 Pages
The global economy is a complex and multi-faceted system. When one variable changes, such as a dramatic increase in the New Zealand dollar, the spin-off effects can be detrimental to some while increasing the wealth and living-standard of others. This essay will discuss the global economic system we have in place today, and the consequential distributive injustices as a result of this structure. These perceived injustices arise as a result of the ethical debate of reducing poverty via economic growth versus creating a sustainable environment.
The origin of the capitalist economy we have today can be linked back to the industrial revolution between the 1750s-1850s. As the economy began to display signs of rapid growth, global population
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The idea of the capitalist market is in contrast with that of the socialist market. The aforementioned is characterised by private business ownership, free entry into the market, profit as the ultimate goal, consumer choice and the government acting as a type of economic regulator. A socialist market is more typical of a government-planned economy where distribution of income and wealth is the key to obtaining social gain. The Washington Consensus is a set of policy based themes its author, John Williamson, believed necessary for the recovery of Latin America after the financial crisis of the 80s. Williamson provides a set of capitalist ideas which the IMF, World Bank and US Treasury Department use when setting policies (Williamson, 2002). The Washington Consensus is proof that, for the most part, the economy is still in a capitalist form. However, recently there has been a huge push by socialist economies such as China and Russia as they become increasingly powerful in an economic sense, although in a way they are also becoming increasingly westernised. The problem is evenly distributing the world’s resources when increasing amounts of people want more than they actually need. Socialist state economic systems but with Americanised consumerism is setting the scene for an interesting start to the 21st century.
The changing economic landscape comes at the heels of an ever-expanding and expending Chinese economy - an