SOCIAL SCIENCE DEPARTMENT

World
Economics
Prepared by: Prof. Ester Onag M.A.
International
Monetary Fund
REGARDS ECONOMIC
GLOBALIZATION

as a historical process representing the result of

human innovation and technological progress
 ECONOMIC GLOBALIZATION

IT IS CHARACTERIZED BY THE INCREASING

INTEGRATION OF ECONOMIES AROUND THE
WORLD THROUGH THE MOVEMENT OF
GOODS, SERVICES AND CAPITAL
ACROSSBORDERS
\
 Movement that Change
BECAUSE OF ECONOMIC GLOBALIZATION

Products of People Organizations and Technologies

Institutions
International
Trading System
WHEN WAS IT STARTED?
The oldest known international trade was
the Silk Road - a network of pathways in
the ancient world that spanned from
China to what is now the Middle East and
to Europe
International Trading System
PROFITABLE PRODUCT TRADED THROUGH THIS
NETWORK WAS SILK, WHICH WAS HIGHLY PRICED

Traders used Silk Road regularly from 130 BCE when the Chinese Han Dynasty
opened trade to the West until 1453 BCE when Ottoman Empire closed it
Age of Globalization
ACCORDING TO DENNIS O. FLYNN
AND ARTURO GIRALDEZ
"All important populated continents began to
exchange products continuously - both with each
other directly and indirectly via other continents -
and in values sufficient to generate crucial impacts
on all trading partners"
Galleon Trade
CONNECTING MANILA
(PHILIPPINES) AND ACAPULCO
(MEXICO)
The galleon trade was part of the age of
mercantilism. From the 16th Century to the 18th
Century, countries, primarily in Europe, competed
with one another to sell more goods as a means to
boost their country's income (Monetary Reserves)
Trade System
GOLD STANDARD
A system under which nearly all countries fixed the
value of their currencies in terms of a specified
amount of gold

FIXED EXCHANGE RATE SYSTEM

A regime applied by the government or central bank
that ties the country's official currency exchange
rate to another country's currency. All based from
gold value

GREAT DEPRESSION
It was a severe worldwide economic depression that
took place mostly during the 1930's beginning in the
United States
Great
Depression
MANY SCIENTEST ADVISED
TO REDUCE DEMAND AND
CONSUMPTION
If government could only spend money
that was equivalent to gold, its capacity
to print money and increase the money
supply was severely curtailed
John Meynard
Keynes
GLOBAL KEYNESIANISM -
THE ROLE OF
GOVERNMENT IN
MANAGING SPENDING
SERVED AS THE ANCHOR
FOR WHAT WOULD BE
He believed that economic crises occur
not when a country does not have
enough money but when money is not
being spent and thereby not moving
Bretton Woods
System
IT WAS INFLUENCED BY THE IDEA OF
JOHN MEYNARD KEYNES
It was inaugurated in 1944 during the United
Nations Monetary and Financial Conference to
prevent the catastrophes of the early decades
of the century from reoccurring and affecting
international ties
 INTERNATIONAL BANK
FOR RECONSTRUCTION
AND DEVELOPMENT

Responsible for funding postwar

reconstruction projects

INTERNATIONAL
MONETARY FUND
The global lender of last resort to
prevent individual countries from
spiraling into credit crises
GENERAL AGREEMENT ON TARIFFS AND
TRADE (GATT)
Its main purpose was to reduce tariffs and other hindrances to
free trade
 ECONOMIC NEOLIBERALISM
Is an economic theory and an ideological conviction that supports
maximizing economic freedom for individuals and thus reducing the
amount of state intervention to the bare minimum. It advocates the
elimination of government-imposed restrictions on transnational
movement of goods, capital and people
 THE NEOLIBERAL CHALLENGE

POLITICAL SOCIAL ECONOMIC

Funding lobbying organizations Spiraling inequality, pervasive Alliance of business devoted
and think tanks and reversing insecurity and uncontrolled effort to winning economic
the policies pollution policies than important policies
for the rights of the people