» World Economy
In recent years there has been plenty of evidence to show just how closely the different economies around the world depend on each other. In order to fully understand our own economy it is now vital to understand it within the global perspective. There have been a number of great books written on this subject. Here are the top 5 best global economics books reviewed.
Different countries around the world have trade agreements with other countries. The most important and influential of all trading agreements is the North America Free Trade Agreement (NAFTA). The members of NAFTA are the US, Canada, and Mexico and it is sometimes referred to as a trilateral trading block. The reason why NAFTA is so important is that between the three of these members there is the largest GDP of any trading block in the world.
Dependency theory has been put forward by social science theorists in an attempt to explain how developed and developing nations affect each other. It implies that the resources flow from poorer countries to the wealthier countries. It is viewed as an opposing view to the notion of a free market economy as it points out deficiencies in that system. This theory has been highly influenced by the work of Hans Singer and Raul Prebisch.
Capitalism and socialism are too very different ways of managing an economy. These two conflicting approaches have been used by different countries around the world and both sides continue to have strong support. There have also been countries like the UK that have attempted to mix the two economic philosophies. The main difference between capitalism and socialism is in regards to how resources in a country should be owned and controlled.
You will likely have noticed that currency exchange rates don’t tend to be static; in fact they can vary greatly from day to day. Some people actually use the fluctuation currency exchange rates as a means to make a profit; buying at one rate and selling at another. You may be wondering though, how exactly are these currency rates decided in the first place. Who decides how much a dollar is worth when compared to the Euro? You may also be asking yourself why they just don’t pick an exchange rate and just stick with it; instead of this constant fluctuation.
Anyone who watches the news is sure to have heard about the World Bank, but there may be some uncertainty as to what this institution actually is. Confusion about the World Bank is understandable as it is unlike any other bank people will be familiar with. In fact many would argue that it isn’t even a bank at all and more an agency that specializes in providing leveraged loans.
Heat Map of Worldwide GDP Real Growth Rate 2007
Data source: 2007 CIA World Fact Book
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