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Globalization and its Representation in the World Economy

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Plan Plan The essence and the basic aspects of globalization. The driving forces of globalization and its stages. The impact of еconomic globalization on the development of national economies. Current international economic problems. The process of international economic integration as a representation of economic globalization Advantages and disadvantages of globalization in the World Economy.

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Definitions of globalization: Definitions of globalization: "the compression of the world and the intensification of the consciousness of the world as a whole” ( Roland Robertson); …all those processes by which the peoples of the world are incorporated into a single world society (Martin Albrow and Elizabeth King); the increasing integration of economies around the world, particularly through trade and financial flows, but also the movement of ideas and people, facilitated by the revolution in telecommunications and transportation

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Scholars separately defined economic, technological, political, cultural and social globalization: Scholars separately defined economic, technological, political, cultural and social globalization: economic globalization - the institutionalization of the opening of markets, liberalization of national economy and international economic integration; technological globalization refers to the new communications technology and the information revolution; political globalization refers to the withering away of the nation-state; cultural globalization refers to the present homogenisation of culture; social globalization refers to the homogenisation of today’s’ mode of life which is based on an individualist and consumerist culture.

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The KOF Index of Globalization measures the three main dimensions of globalization: The KOF Index of Globalization measures the three main dimensions of globalization: economic globalization is characterized by international economic integration, liberalization of national economic policies that provide free movement of goods, capital and services throughout the world; social globalization expressed as the spread of ideas, information, images and people throughout the world; political globalization characterized by a diffusion of government policies.

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KOF Index of Globalization

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List of most 10 globalized countries by the KOF Index in 2015

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Economies by size of merchandise trade in 2013

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Ratio of trade in goods and commercial services to GDP, 1995-2014

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China has become the world’s leading exporter China overtook Japan as the leading Asian exporter in 2004, three years after its accession to the WTO. China surpassed the United States in 2007 and Germany in 2009 to become the world’s leading exporter. The share of developing economies’ exports in world trade increased from 26 percent in 1995 to 44 per cent in 2014 while the share of developed economies’ exports decreased from 70 per cent to 52 per cent.

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China, United States and Germany are top three merchandise traders China became the world’s biggest merchandise trader in 2013, with imports and exports totalling US$ 4,159 billion. It recorded a trade surplus of US$ 259 billion, 2.8 per cent of its GDP. The United States is the second-biggest merchandise trader, with imports and exports totalling US$ 3,909 billion in 2013. The US trade deficit was US$ 750 billion (4.5 per cent of its GDP). Germany is in third place, with a trade surplus of US$ 264 billion in 2013, 7.3 per cent of its GDP. Japan ranks fourth, with merchandise trade totalling US$ 1,548 billion in 2013. It recorded a trade deficit of US$ 118 billion, 2.4 per cent of its GDP.

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Growth in the volume of world merchandise exports and production, 2005 - 2013

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Growth in the volume of world merchandise trade by selected region and economy, 2005 - 2013

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World merchandise imports by region and selected economy

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World merchandise exports by region and selected economy

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Real GDP of leading countries and Ukraine in 2013

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Structure of world GDP by region of the world

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“Institutions are the “rules of the game” in society or, more formally, are the humanly devised constraints that shape human interaction. In consequence they structure incentives in human exchange, whether political, social, or economic. . . .” “Institutions are the “rules of the game” in society or, more formally, are the humanly devised constraints that shape human interaction. In consequence they structure incentives in human exchange, whether political, social, or economic. . . .” D. North. "The countries of the" third world "- according to D. North – are poor because the institutional constraints define a system of rewards for political (or economic) activities that do not encourage productive activity." “There is no country condemned to live in poverty; for any society is possible to create such institutional environment that will ensure the long term economic growth“. D. North.

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Сurrent global economic problems Trade protectionism in advanced countries in a rapidly globalizing world. Excessive fluctuations and misalignment in exchange rates and financial crises. Structural imbalances in the United States, slow growth in Europe and Japan, and insufficient restructuring in transition economies/ Deep poverty in many developing countries. Resource scarcity, environmental degradation, climate change and sustainable development.

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International economic integration is a process where the economic barriers between two or more economies are eliminated International economic integration is a process where the economic barriers between two or more economies are eliminated