Modern economic development

Economic development

The modern economic development of each state is inextricably linked to its participation in the global economic chain. But in this sense, after the Second World War, there is a strong strengthening and diversification of economic exchanges between the states of the world.

The factors that contributed to the development of the global economic contour were both political. The emergence of new independent states, the expansion of the East-West, etc. Also economic: the degree of development of national economies, the deepening of the international division of labor. And the technical revolution, scientific. Also liberalization of exchanges between countries, which led to quantitative and qualitative growth of economic activity. The combination of flows of material and monetary values, the results of scientific and technical creativity and the types of activities that provide services that are the subject of the mutual exchange of activities between national economies. But in their close interweaving and interdependence form the world economic cycle.

Depending on the physical nature of the object of relations between countries, the constituent flows of the world economic chain can be classified into:

  • commercial flows
  • international capital flows
  • flows of international economic, scientific and technical cooperation

In turn, commercial flows include flows of tangible goods and a flow of intangible goods.

Also intangible goods flows are known as invisible trade. Includes:

  • technological flows in the form of patent licensing, consulting, engineering, etc.
  • service flows, tourism, transport, insurance, international communications, etc.

In contrast to the international exchange of tangible goods, invisible trade flows are not included in customs tariffs and, therefore, they are not subject to customs duties at border crossings.

Features of the world economic circle

The deepening of international specialization and the new directions in which they are developing give new features to the world economic circle.

  1. Firstly, the world economic chain is experiencing a strong diversification of forms of economic ties. If in the past international trade in goods, and then international investment were the main forms of international economic relations. But now new forms have appeared in international economic cooperation, international monetary relations. And international tourism, the exchange of scientific and scientific knowledge, international circulation of labor, etc.
  2. Secondly, the interdependence of flows within the global economic chain is deepening. At present, it is impossible to imagine that international trade took place without an international investment stream. Because complex machines and machines sell 80–85% of their value on credit. Also without international economic cooperation, without an international stream of scientific knowledge. And technical (trade in patents and licenses), etc. The interdependence and interaction of various international economic flows reflects internal relations in the global economic chain.
  3. Third, international economic flows are developing in new forms. Modern technological progress itself has influenced the evolution of commercial forms, methods, payments, the conclusion of contracts in the course of international economic exchanges.

One of the main features of the world economic contour is also the acceleration of the speed of the economic contour. This progress underlines the tendency to strengthen the role of external factors in the reproduction process and, accordingly, to deepen the interdependencies between states. A natural consequence of the faster growth of foreign trade compared with world production is an increase in the share of exports in total national production, an increase in the participation of states in the international division of labor.

Features of the global economic scheme

Among the features of the global economic scheme, we note. its objective nature. Each country, regardless of its size or geographical location, feels the need to participate in the global economic chain. Through this, he can provide: expanding the sales market and offers, investments or sources of import of capital and technology, stimulating the entrepreneurial spirit and the process of modernizing the economic structure.

The historical historical nature of the global economic chain refers to the difference of the forms and mechanisms. The dynamics of the world division of labor, the many and great variety of participants in the global economic contour transform the structure of the world market itself and its mechanisms:

  • mechanisms of the “buyer’s market” replace those that are specific to the “seller’s market”;
  • the equilibrium prices resulting from the confrontation of supply and demand are replaced by the mechanisms of “direct pricing” or “transfer pricing” used by international companies;
  • the mechanism of stable exchange rates gives way to “floating rates”;
  • traditional import auctions have a strong revival, becoming an international ascension market;
  • modern telecommunication equipment and electronic computers significantly increase the pace, fever and scale of stock exchanges, which are becoming the main institutions of the market;
  • some commercial methods lose their importance and new, softer but more sophisticated ones are always invented, etc.

The weight of states depends on many of the factors. For example, the level of economic and technical development, the degree of diversification of the economy. Also the level of technical and production complexity. As well as the volume and degree of exploitation of natural resources, the size of the domestic market. And the complexity of products on the world market, means of communication.

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