Global Economic Convergence Analysis

Proponents of globalisation advocate that globalisation has led to economic growth and development leading to better living standards worldwide and benefiting the whole of human kind. This has not been entirely true, some countries have benefitted more than others, there have been visible signs of economic unevenness despite the promises of globalisation. Economists advocate for global economic convergence, that poor countries will soon catch up to the rich developed world. This paper attempts to discuss causes of this economic unevenness focusing on the international institutions that influence the process of globalisation and this has made global economic convergence nearly impossible.

KEY WORDS : global economic convergence, economic unevenness,

It refers to a shift of transformation in the scale of human social organisation that links distant communities and expands the reach of power relations across the world’s major regions and continents .

Some globalisation definitions can be one dimensional such as the Marxists whose idea of globalisation is based on capitalism and classes of society. The above definition provided by Held and Mcgrew has more dimensions. It highlights the important historical dimensions of different periods of globalisation over the centuries, from pre-modern to early modern, modern and contemporary globalisation. It also tries to demonstrate that globalisation is not an event but a process.

The process of globalization is facilitated mainly by three international organisations. The World Trade Organisation facilitates in the import and export of goods and services as well as the control over the rights on new technologies agreements. The flow of capital is broadly guided by international financial institutions, like the World Bank and the International Monetary Fund. Ofcourse, they do not directly control the flow but they exert tremendous influence in the formulation of the policies of the developing countries in respect of the flow of

The United Monetary and Financial Conference as the Bretton Woods conference was officially called created the International Monetary Fund and the World Bank to prevent economic crises and to rebuild economies shattered by the war.

The monitoring of capital flow is complex, countries are free to control the flow of capital across their borders, but these institutions encourage them to loosen their control. They also put pressure on the developing countries to liberalise their imports. Since the developing countries often go to these institutions for loans, they are under great influence of their policy prescriptions and demands, like the saying goes you cannot bite the hands that feed you. And these policies are not always in the best interest of the developing countries. Particularly the IMF, it has been very widely criticised for its uniform policy prescriptions for all countries in all situations, even though the conditions are widely