On the other hand, the second aspect assumes that capital mobility and the relentless advance of globalization are the main characteristics of the world economy at the macroeconomic level (Johnston and Saad-Filho, 2005). Lastly, interest rate is the most important economic policy tool since it
The dependency on Europe and North America by the Region, therefore, is the evidence of the empire the West has built by imperialism, and perpetual profit or loss of imperialism for a state, depending on which side of the divide that state stands. Imperialism does not end. The imperial power merely changes. Active, conspicuous imperialism might be latent in some states of the Region, but it surely is not absent. Independence and freedom alone can guarantee an end to imperialism, but ‘independence’ and ‘freedom’ are relative conceptions.
Globalization is said to be a tool and instrument for multinational corporations and global capital, but the reality is that it is sustained by government and institutions (trade.ec.europa.eu). They liberalize trade, protect investment, and define the size, shape, equity, and social justice of the global economy, and these lead to their goal to guarantee monetary stability. The global trading systems, such as the GATT and the WTO, is a political choice, and it can only be maintained by political choices. Governments are the ones who make the choice on behalf of their represented people. (trade.ec.europa.eu) The highest expectations are expected from the world’s largest economies, the governments of America and Europe.
Research Question: Does the current Economic Globalization and Interdependence process help or hinder the development of all nations? Theory/Hypothesis/Abstract: Economic globalization is reinforced by the idea that states which integrate with the international economic exchange system will become a more progressive and modernized as a consequence. However this paper will argue that this general perception about development does not take into account that globalization may in fact keep poorer nations weak for the purpose of exploitation. There is a need for the current approach to be adjusted. The international division of labour, class distinction, and the domination of liberal economic theory under the current approach to globalization all serve the interests of the wealthy nations, promoting and supporting dominance and exploitation.
Social constructivist approaches to international institutions can account for some features of the OECD that make little sense from the perspective of state-centric rationalist theories of international cooperation. Rationalist approaches see international institutions as created and used by states because such institutions are more efficient mechanisms for those states to pursue their self-interest than could be achieved through direct state-to-state interactions. For decades international relations and a country’s policies were seen as rooted in nationalism – the assumption that all foreign relations were done on the national scale and policy decisions were made with only what’s best for that nation in mind. The idea of nationalism is based
He offered an idea that how a country might play a game strategically and could be successful in extracting great levels of revenues from trade, by implementing new trade theories. The comparative advantage theory of Ricardian gained a new aspect as Porter emphasized on development of comparative advantage or innovativeness by improving to sustain greater shares of market. Therefore, the idea of productivity that can be work to attain greater levels of international competitiveness (IC) emerged [Porter (1990)]. Indices based on productivity are extensively used in the measurement of competitiveness. As per Porter point of view productivity is the most valuable thought in international competitiveness.
(David Ricardo, Theory of Free International Trade). The neoclassical economists believed that in a competitive market, prices would direct consumers and cause the most efficient allocation of resources, which will maximize society’s income. This believe had developed the pure theory of trade and this also present Adam Smith’s theory in the invisible hand of the market and competition. Also, it shows the benefits of laissez-faire policy in relation to international exchange. The neoclassical economists strongly agree that the comparative advantage theory by David Ricardo is much more relevant to international trade then the absolute advantage by Adam Smiths.
This is what contemporary globalization should also be measured against. What is Globalization? Globalization is an objective, empirical process of increasing economic and political connectivity, a subjective process unfolding in consciousness as the social awareness of growing global interconnectedness, and host-specific globalizing projects that seek to shape global
Stiglitz( 2002) mainly focus on the three main economic institutions, International Monetary Fund(IMF), World Bank and World Trade Organisation (WTO), which make great influences towards globalisation. Although Stiglitz(2002) admitted that globalisation brings us advantages, he believed that globalisation bring us more
Neo-Gramscians look at hegemony from the perspective of class relations. Class is considered as hegemony if it legitimized its domination by means of institutions and concessions. When a class has established dominance also in formal political structures of the state, it is a historical bloc. Neo-Gramscians argue that due to process of globalization the neoliberal transnational historical bloc either already exist or at least beginning to emerge and