The global economy. Part 1

Aleksei I. Bolonin










                THE GLOBAL ECONOMY




Study Guide
Part 1














PRIMEC PUBLISHERS
Moscow
2021

    UDC 33(075.8)
    LBC 65.5я73
    B79

        Reviewers:

     Ragulina, Yulia - Doctor of Economics, Professor, Head of the Compliance and Control Department of the Higher School of Industrial Policy and Entrepreneurship of the RUDN University.
     Burlachkov, Vladimir - Doctor of Economics, Professor of the Department of International Relations, MGIMO University, Ministry of Foreign Affairs of Russia.

        Bolonin, A. I.

  B79 The global economy: study guide, part one / A. I. Bolonin. -Moscow : Primec publishers, 2021 - 76 p.




ISBN: 978-5-91292-330-2
DOI: 10.18334/9785912923302








ISBN: 978-5-91292-330-2

© Bolonin A.I., 2021
                           © Design, cover design PRIMEC Publishers, 2021

Content

     Preface ....................................................5
     1.  The World Economy: main concepts and development trends ...6
     1.1. The World Economy as a study ..........................6
     1.2. The formation of the world economy, stages of its evolution 11
     1.3. The main actors of the world economy...................15
     1.4. The measurement of the World Economy development.......17
     2.  Main theories of the world economy.....................23
     2.1.  Sociocultural theories of the world economy: ........23
     2.2.  The world system theory .............................27
     2.3.  Dependency theory ...................................29
     2.4.  The gains for trade..................................32
     3.       Development trends in the world economy in the 20th - 21st centuries ......................................................39
     3.1. The unevenness of economic development................39
     3.2. Liberalization in the world economy ..................41
     3.2.1. Internal liberalization.............................42
     3.2.2. External liberalization ............................44
     4.  Globalization of the world economy.....................45
     Re   ferences..............................................71

        Abstract


      The manual acquaints readers with the complex organization of the world economy, its current trends, the peculiarities of the development of states, taking into account cultural, administrative, geographical and economic factors. The manual examines the place of developed and developing countries in the world economy, as well as modern conditions and problems of their development. For undergraduate students studying in the specialty of world economics and mastering the course in English.
      Keywords: The World Economy, global economic system, characteristics of the global economy, the main actors of the world economy, the measurement of the World Economy development, theories of the World Economy.

        Preface


      The study guide is prepared in accordance with the course the National Economy of Foreign Countries taught at the Bachelor’s Program in International Economic relations in Financial University and discusses the development of the global economy
      Within course students shall study:
           ►         Various theories of the world economy and economic growth
           ►         The main trends of the world economy process
           ►    The role of the different factors in the development process
           ►         Problems of the world economy and means of its solving
           ►         Different groups of countries and regions of the world
     The subject of the World Economy is
           ►    Studying various national economies as well as territorial
     arrangement, formation and development of socio-economic systems
     The aims of the course are:
           ►         To provide students with foundational knowledge and sound understanding of mechanism and resources of the world economy
           ►         To introduce main groups of countries in the world economy and the existing gap between them
           ►         To provide students with knowledge of the main trends and perspectives of the development of the modern world economy
      At the end of the course, students should know the basic theories of economic development and economic growth, how economic growth is measured and what factors influence economic growth. The course is accompanied by a set of test items that allow to control knowledge

        1. The World Economy: main concepts and development trends
        1.1.  The World Economy as a study

      Perhaps the most important characteristic of the modern world is its global character. Objective processes of globalization could not but reflect the economies of previously scattered countries. The global economy is a multi-level, global economic system uniting national economies of the world based on the international division of labor through systems of international economic relations.
      In other words, the global economy is a combination of national economies and non-state structures, united by international relations and participating in the international division of labor.
      The modern world economy has a very complex structure, a lot of different trends. And it should be noted that the most dynamic and complex processes currently occur mainly in the global economy.
      Now the global economy has become so interconnected that production in isolation is virtually impossible. The main components of the global economy are:
      - national economies,
      - transnational corporations,
      - integration associations,
      - international economic organizations.
      At the beginning of the 21 century the development trend of the world economy has become the process of globalization (a single global market for goods, services, capital, labor and knowledge). Globalization is accompanied by internationalization (a process of strengthening participation of the country in the world economy).

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      The most important trend in the global economy has become its liberalization. Positive trait liberalization in that it laid the foundation for the development of post-industrialization, which is one of the most important features of the world economy of the XXI century. For countries in recent decades, membership in various international organizations has become the norm the most probable prospects for the development of the world economy.

           ►          Definition 1: The world economy is the economy of global society and national economies, as economies of local societies, making the global one.
           ►          Definition 2: The world economy is the economy of the world, comprising of different national economies; besides each economy related with the other in one way or another
           ►          Definition 3: The world economy is world-wide economic activity between various countries that are considered intertwined and thus can affect other countries negatively or positively
           ►    We can define the World Economy as:
           ►          set of interconnected national economies system of international division of labor, economic and political relationship;
           ►          system of international economic relations, as general, universal connection between national economies;
           ►          global economic system, self-replicating on level of productive forces, production relations and certain aspects of legal and political relations to the extent which incoming, business entities have a certain compatibility at each of the three named levels.
      We can note the following main characteristics of the world economy:
           ►    The complicated system (a number of actors)

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           ►   The common aim (meeting the needs)
           ►         Integrity (all parts of the system are intertwined and interact with each other)
           ►   Structurally
           ►   Hierarchy
           ►   Dynamic balance of world economy
     The global economy is a socio-economic and historical system characterized by:
     1.       Integrity, which implies a sustainable interaction of all component parts (components). However, system integrity is not at all means its harmony. The latter can only be hypothetical or most likely ideally. Objective reasons hindering harmonization of the world economy, which has arisen to the present day, exist today, and will be thereafter (this, unfortunately, is the nature of man).
     The presence of a common goal - the functioning of the economy is aimed at meeting human needs (demand), but in different subsystems, this goal is modified due to different socio-economic conditions.
     It should be noted that economics is only a method of satisfying human needs. Over time, humanity has realized that housekeeping, not only at home, but also at the country level, at the state level (or, in other words, the economy itself) is the least costly method of satisfying human needs. There are also wars, raids, robberies, theft. But it was economics that turned out to be the most effective way to meet human needs.
     Of course, the best satisfaction of human needs occurs precisely in those economic systems where such an institution as competition exists.
     But competition in production is a derivative of political competition.
     Again, it is no coincidence that the first problems that the settlers of New England were solving in the colony of the Massachusetts Gulf,

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