Master of Science in Computer Science and Engineering

International Islamic University

The Global Economy and Information Technology

Minhaz Uddin
ID: MC193104

Supervised by
Prof. Mohammed Shamsul Alam
Professor
Computer Science and Egineering Department
International Islamic University

December 30, 2020

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 TABLE OF CONTENTS

PAGE
CONTENT
NO

The Title Page …………………………………………………...…………… 1

Acknowledgements …………………………………………………...…………… 4

Abstract …………………………………………………...…………… 5

Chapter 1 Introduction ……………. 6

1.1 Foreword ……………. 6

1.1.1 The Global Economy Characteristics ……………. 6

1.1.1.1 Globalization ……………. 6

1.1.1.2 International Trade ……………. 6

1.1.1.3 International Finance ……………. 7

1.1.1.4 Global Investment ……………. 7

1.1.2 The Importance of Global Economy ……………. 7

Economic Importance at a
1.1.2.1 ……………. 7
Micro and Macro Level
Long-Term World Economic
1.1.2.2 ……………. 8
Outlook

1.1.3 The Factors of Global Economy ……………. 8

1.2 The Global Economy and Information Technology ……………. 8

Chapter 2 History ……………. 9

The Global Economy Affected by Information

Chapter 3 ……………. 11
Technology
Technology’s Percentage of World Economy
3.1 GDP is Growing ……………. 11

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 Technology in public market’s
3.2 ……………. 12

Tech in Private Markets: Huge Increase in

3.3 ……………. 12
Number of Unicorns
Expanding Boundaries of Information
3.4 Technology Companies ……………. 12

Covid-19 Effect on Information Technology and Global

Chapter 4 ……………. 13
Economy

Evolution of Global Economy Affected by Information

Chapter 5 ……………. 14
Technology

Chapter 6 Conclusions ……………. 15

References ……………. 16

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 ACKNOWLEDGEMENTS

During the process of developing this paper, I have received help from my teachers, friends and
family which I must acknowledge at the onset. First, I am grateful to Allah for helping me come
this far and giving me the strength to complete this thesis.

Then, I would like to thank my supervisor, Mohammed Shamsul Alam, for his amazing and
endless support throughout the thesis. I am indebted to him for his expert suggestions which
always motivated me to become the best version of myself. I also take this opportunity to thank
my dear faculties at the International Islamic University for their constant support and
encouragement.

My sincere acknowledgement also goes to my parents who have nicely reciprocated my oblivion
nature by their nourishing and generous attitude toward me since my childhood.

I also place on record, my sense of gratitude to all who, directly or indirectly, have helped me
with this paper.

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 Abstract

Since the last few years the computer and computer based technology developed very rapidly. As
a result the lifestyle of people has changed with time. It impacts the economy due to the change
of lifestyle. The internet has changed our power of thinking. It helps people to share their
emotions or any information very easily. The global business cost is decreased due to the
increasing rate of technology. In the modern world people do their work using robotics and try to
save money. Long distance communication has become easier than the previous era. So, the
government of Bangladesh tries its best to make a good relationship with technology. The
economy of our country is also dependent on the internet like share bazaars, e-commerce
business etc. The global share market is also dependent on technology. Nowadays we don’t think
about a single day without the internet. Consider the share market example if the internet is off
then no trends occur as a result the global economy goes down and faces many problems. The
company faces loss due to the problem. In a single word the internet is part of the economy. In
covid-19 situation, the internet plays a very important role because a lot of employers do their
job at home using the internet. If any wrong occurs with the internet then many people can’t do
their job as a result they suffer from risk of firing from their job. If they are fired from their job
then their family face economic problems. We consider a single family whose earring member
lost his job as a result he tries his best to minimize the daily or monthly cost of the family. As a
result it impacts a shop from which he buys his necessary product because he can’t buy a lot of
goods. It impacts the sales of shopkeepers. If shopkeeper sales are decreased then he gives lower
tax to the government which impacts the country's economy. In the case we consider a country
and a family, if we consider the whole world then the same problem is faced. During the covid-
19 situation we face the same types of problems.

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 Chapter 1

INTRODUCTION

1.1 Foreword

The present global economy is differ from the past global economy due to the way that it
is organized and governed by collaborating nations. It impact not only producing of
goods but also services between countries. The people move any countries very easily.

The global economy is refers to the interconnected worldwide economics activities that
take place between multiple countries especially over the borders. The economy has a
merit and demerit impact on country economy.

1.1.1. The Global Economy Characteristics

The global economy have the following characteristics:

1.1.2.1. Globalization

Globalization is a process to exchanges goods, and services, capital,

technologies or cultural practices all over the planet and speedup movements. It helps us to make
a relationship between different countries and population. It open the new sector of job all over
the world. Globalization make an interdependence between various countries or nations. It help
countries to share their information technology. The international share market is also symbol of
globalization.
1.1.2.2. International Trade

International trade is a place where we can find various types of goods and
services from all over the world. In a single world we can say that import and export are
occurred in a same place. International trade is also important part of global economy. The prices
of goods and services are dependent on global events and environment. Every countries go for
international trade when they can’t sell their goods and services in their own countries. They try
to increase relationship between various countries.

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 1.1.2.3. International Finance

International Finance is a part of financial economics. It deals with the

macro-economic relation between two countries and their monetary transactions. The example of
these types of finance are interest rate, exchange rate, FDI, FPI and currency prevailing in the
trade. It is also part of international financial management. It helps investors and multinational
corporations to manage international risks such as political risk and foreign exchange risk,
including transaction exposure, economic exposure, and translation exposure.

1.1.2.4. Global Investment

Global investment are those investment which indicate any investor invest
money, labor, goods etc. outside his domestic country or over the boundaries all over the world.
Investor and risk management is the important part of global investment. Investor try to invest in
a country where the labor cost is low or product developing time is lower than investor country.
In a single word global investment take place when investor get more profit by investing other
countries to do their work or produce goods. Garment is one of the best symbol of global
investment. We found various types of global investment like:
 Government Funds/Aids
 Cross Broader Loans
 Foreign Direct Investment
 Foreign Portfolio Investment

1.1.2. The Importance of Global Economy

The importance of global economy are given below:
1.1.2.1. Economic Importance at a Micro and Macro Level
The population of the world is increased very rapidly as a result the
economics of the world is also increased. Population is one of the primary engines of world
economy. Micro and macro all types of work basically depend on global economy.
1.1.2.2. Long-Term World Economic Outlook

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 The long-term economy development of any country basically depend on
global economy. If the world economy go under loss then the investor don’t invest globally. As a
result, the under development countries don’t get any investor to invest on their project. As a
result, the countries face economic crisis.
1.1.3. The Factors of Global Economy

The factor which affect the global economy are given below:
 Technology
 Natural Resources
 Info structure
 Population
 Labor
 Human Capital
 Law
1.2 The Global Economy and Information Technology

In the present world we find a various types of technology which impact the global
economy. If we try to find the main one which affects the economy mostly then it will be
Information Technology. Information technology indicates computer, internet and computer base
project and development. The investor can easily communicate with other countries labor using
Skype or messengers. The investor can easily investigate the economy of any country because
they can find any information form the internet. Freelancing is one of the best example of
development of information technology. Many jobseeker find the online job on a freelancing
site. As a result they earn money and contribute on the economy of their country. It also impact
the global economy. During covid-19, the online base job get more popular. People try to
complete their job from the house because for their health safety issue. So, we see that
information technology is one of the important part of global economy.

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 Chapter 2

HISTORY

It is the short history of global economy since 1800. It is a global capitalism system
which took shape when the British economy went ‘underground’ and began to start collecting its
energy and raw materials from mineral resources. The dynamics of capitalism goes rapidly when
the progressive substitution of minerals for plants consider as the economy’s source of energy
and raw materials. It consider as a lot of new sources of energy and raw materials which free the
economy from the narrow resource like as an organic, plant-based economy. When the more
energy are produced the cost of transportation are reduced which impact the global economy
very much. A goods are exchanged between various countries and seller from various countries
go to the international trade for selling purpose. The long distance trade got more popular. In the
same time the division of international labor has become one of the most important need. The
logic of uneven development play an important role because the resource substitution is
deepened on it. On the one hand, the economy which is mineral based created several positive
feedbacks which strengthened the already existing tendency towards the division of trading areas
into Core and Periphery or go to the attraction of high and low value-added activities. In
addition, these new technologies is increased the military power of the states. Consider all the
matter these tendencies—markets, energy substitution, and force are created the modern global
economy and increasingly integrated. But it also deeply divided into a Core and Periphery.

According to the global centralization of power the history of the new mineral-based
global economy divided into three part. The first phase, since from 1800 to 1945 in a small
number of core areas especially Britain, France, United States, and Germany intensive power—
and, with it, capital, technology, science and manufactures. In reversely, the most part of the
Periphery close to all of Asia and Africa who lost its supremacy over a few Core countries. They
was forced to open their economies to Core capital. Basically in primary goods, and didn't
improve of the any living standard of the indigenous population. In the late 1940s, the global
economy slowly move to a second phase. Although this phase was started at 1917 during the
Russian Revolution. At the time power was decentralized from the Core to the Periphery. At the

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level of the economy, this decentralization overturned the earlier application of manufactures in
the Core countries, and produced fairly advancement of growth in the dependent Periphery. The
earlier at 1980s the Core countries again recentralized its power. Previously at the mid-1990s,
this re-centralization had eclipsed the previous roof in the global centralization of power
achieved during the late nineteenth century.

In these section, we describe the technological evolution of global economy from the
yearly post war years until the beginning of world crisis in 2008. The world economy was
changed dramatically and growth very rapidly by invention of computer and development of
information technology which is called the golden age of technologies. Charles Babbage who
was considered as person by inventing first computer at 1822. It is the beginning of development
of technology. It impact the global economy very much. The leading countries transferred to less
developed countries due to the dual-use peculiarity and the scale of production and market
increased. The technological system which was launched after the World War II is consider as
the backbone of the global economy. It play an important role in many sector especially is
manufacturing production, trade in goods and services or foreign direct investments. The steady-
state growth theoretical model described the most properly how the economy affected by
increments in capital and investments. It wasn't consider as matter of think that form where there
are originated. The global crisis of 2008 explores continuing growth of the world economy
because of rapidly growth of technological source. It was reflected the emerging discrepancy
between technological development and economic growth in many ways. The opposite of
industrialization of the leading economies destroy the foundation for economic sustainability by
bubble effect and the oil-dependent countries are affected by Dutch disease and it affect the
energy resource in the world trade and also for worldwide growing militarization.

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 Chapter 3

THE GLOBAL ECONOMY AFFECTED BY INFORMATION

TECHNOLOGY
At the beginning of the 2015, we saw that the great transition of the society in the middle
way because of the era of information technology. The industrial jobs and institutions decline
towards death but they gain progress in information technology. The transition continues since
March over the last year. The transition affect the global economy very much over the last two
year. The undeveloped countries has depended over the developed countries. The global
economy is growth very rapidly due to the continue invention of technology by various
companies. As a result we see that the inequality of wealth is rising fast and geopolitical issues
are increased. The last few years, we saw the very low volatility but we have also dependent on it
in many ways. The bigger part of the global economy will be affected by the technology
companies. The technology companies have been overtaken place of the Oil and Gas companies
in the world. The private market try to invest more in technological companies. Many non-
technological companies change them to run with technology.

The information technology not only affected the global economy but also affected the
national security and international competitiveness. It affect the lifestyle of people in many ways
and also arrive a strategic change in world's culture. It affect from resource allocation to person
income in many ways. Many employers lost their job due to the use of technology. The
information technology redefining the global economy in new ways. The areas which is affected
by global economy are given below:

3.1. Technology’s Percentage of World Economy GDP is Growing

The value of industrial market is expected to reach $3.8 trillion in 2016 which was up
from the previous year $3.7 trillion. It increase the World GDP 2%. Before the use of
information technology the world GDP was increased 1% in 2004 and 0.5% in 1992. We
see that technology help the global economy to grow rapidly. If the development is
continue then the raising rate of GDP will be 4% in 2026 and 8% in 2038. Many large

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 companies invest much in information technology which affect the share market very
much.
3.2. Technology in public market’s
In July 2016, the world's 5 largest public companies are technology companies which
capitalize in market. It makes a bridge between the Industrial era and the Information era.
The five largest information companies are: Apple, Google (Alphabet), Microsoft,
Amazon and Facebook.
3.3. Tech in Private Markets: Huge Increase in Number of Unicorns
The public market's suddenly change very much due to the development of information
technology. The technology companies got maturity slowly at the public markets. Their
development got the priority in markets. The rate of share is increased very rapidly. In the
last few years we can see the outstanding rise of Unicorn. It rise its market from startup to
Billion dollar valuation. In 2014 we found 45 Unicorns which is increased at 154 at
January 2017.
3.4. Expanding Boundaries of Information Technology Companies
Software is eating the world said by the Marc Andreessen and said that many companies
and industries which don't use software now they try to use software. It is a good sign for
startups and startup ecosystem because the global economy rising rapidly due to the use
of technology. If we consider the industrial sector then general electric has play an
important role for acquirer of startups.

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 Chapter 4
COVID-19 EFFECT ON INFORMATION TECHNOLOGY AND
GLOBAL ECONOMY

Covid-19 is consider as a one of the dangerous issue in present situation. It stop the growth
of global economy and development of digital infrastructure. The corona virus affect the every
aspect of life. The economic activities greatly affected by it and dramatically change occur at
market like a consumer don’t buy a lot of goods because a lot of employer lost their job. A lot of
business are closed. A lot of famous companies try to fire employee without hiring new one
because they try to reduce their cost. The ICT helps us very much in the case. A lot of companies
do their work online base. As a result the demand of computer knowing persons are increased
and they have hired in many companies. During the global pandemic, the information technology
is also affected. A lot of higher research project are stopped because everyone try to solution for
covid-19 nowadays. As a many countries declare lockdown as a result almost all the people use
internet browse site which affect the speed of internet very much. The internet service provider
don’t maintain this easily because a lot of their worker don’t want to work outside of home. All
types of medical services are now online base as a result a lot of hospital fire their worker and
they try to invest in ICT. They try to make website and app to provide service to their clients. In
a single world we can say that the ICT companies lead the global economy. All the companies
focus on networking system. They try to make communication system easier. The corona virus
not only affect the global economy but also effect the society and social culture. Social distance
is increased by Covid-19. Jack ma say 2020 is year in which the businessman try to continue its
business and they don’t think about profit and if they do this then they will be success
businessman.

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 Chapter 5

EVOLUTION OF GLOBAL ECONOMY AFFECTED BY

INFORMATION TECHNOLOGY

The past and present development of global economy make a platform for the future
development. But the environmental change block the path. If we consider the covid-19 then the
future growth of global economy is reduced by it. If we consider a shop then the shopkeeper
today sell amount reduce from previous days because people don't have enough money to buy
the product. The present situation reduce the labor sharing between nations. But many workers
from all over the world work in many firm using internet. In a single word we can say that the
importance of internet in increased very much.

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 Chapter 6

CONCLUSIONS

This paper provide an overview of how the global economy affected by information
technology. The all types of industries including manufacturing, healthcare, public services,
retail, transportation, food supply, tourism, media and entertainment are changed by the use of
technology. We live in the age of information so that anybody can take benefit of the technology.
They can gain any economical and medical service easily. The economic benefits growth rapidly
due to the extensive production which is the result of excellent network connections. It is
possible due to use of artificial intelligence technology. AI technology invent robot which help
us in our production

In a single word if we want to say that technology is the key driver of economic growth for
any countries. But technology also make production system complex and many workers lost their
jobs. The information technology is also increased the area of research, improve the national and
regional development policies. The concept of information technology increase the social
distance but easily describe the social responsibility and capabilities. Information technology
make the higher studies easy. It creates a various types of new jobs. When the higher study is
easier than the finding of job is more complex. In covid-19 situation information technology play
an important role in study system. The most educational institutes are now dependent on
information technology like they take class online, student submit assignment online etc. The
most R&D companies invest a lot of find in research about engines, automated driving systems,
big data, artificial intelligence, 3-D printing and information and communication technologies.
They try to use robotics in their production system. The development of technology basically
depend on two part one is theoretical part and second one is implementation part. If we want to
use any technology then first we need to gain knowledge then we try to implement the
knowledge. If we want to get more profit from technology then we don’t misuse the technology.
We try to use information technology in a way that we can get more profit and help to increase
the country economy which impact the global economy also.

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