The economic dimension of globalisation

Lubomír Mlčoch

Characteristics of global economy

• Evolutionary Stages of the Global Markets: Contraction of Space, Acceleration of time

International economy is no longer vertically divided into separate national economies, but it implies numerous levels or types of market activities that horizontally spread over a virtual area - replacing the physical geography of national borders by quasi-geography of market structures, transactional costs and information cyber-space. Finances represent a central mechanism that binds these diversified structures into an integral network – a structure in which relative prices of all goods, services and equities are established.

There are two major levers of globalization: the internationalization of production and finances.

Major channels of globalization

The central channels of globalization are direct investments and international trade. These are made possible by the intensive removal of barriers to the production, the abundance of information owing to the progress of technology, and seemingly global domination of the utilitarian ideology.

The development of information technologies & fast information transfer at low costs creates an image of global knowledge of economic protagonists about all relevant aspects of business environment. Pivotal exponents of all the mentioned globalization generators are transnational companies, which economically dominate in many ways over the sovereignty of many countries whose financial systems have increasingly been becoming parts of the transnational financial structures.

The economic internationalization trends are also to a great extent favored by international financial institutions, the IMF and the World Bank. In accordance with this, the standard of a functioning market system implies a model based on the pronounced individualism of protagonists, on marketing resolutions of as many social conflicts as possible and on marginalizing the role of the state in economic transactions.

• Multinational Corporations
• Global Markets
• Capital Markets and ‘Financialisation’ of the World

Consequences

• Labour Markets, Migration, Marginalisation and Exclusion, Brain Drain
• The Poverty Issue, Debt Cancellation, and Alternative Visions for Globalisation
• Distribution of Labour and Capital in a Globalised World

Policy for problem mitigation

• Global Regulation, Global Business Ethics, and Global Common Good

Sources

• List of references - Economy