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International Monetary System was formed to overcome the imbalances in economies arising from globalization. The new system took into account the international trade imbalances, investment, finance, and exchange markets. The international monetary system also took into account the imbalances in international payments which as a result of globalization were settled through financing, changing domestic economic policies, rationing exchange controls, and changes in currency exchange rate.
The management of International Monetary System was difficult because it needed full international cooperation which was politically impossible. For the management of the system, the economies agreed on using a set of policies. For instance, mix of adjustment mechanisms were developed such as floating exchange rates or linking currencies to dollar under fixed exchange rate. Many political and economic crises arose in the midst of globalization. Reformation of International Monetary System was required. Many countries relaxed controls, opened domestic markets and removed regulatory barriers. As a result, financial markets became integrated into one global market influencing floating exchange rate system making it the central part of the new monetary system. Such an exchange rate could provide effective account adjustments by increasing exports and lowering imports and thus creating a trade balance.
Many new treaties and pacts were made within countries as well as amongst others. For instance, the United States-Japan Enhanced Initiative on Deregulation and Competition Policy for Framework was signed to reduce trade deficits between US and Japan. The European Union introduced a single currency known as Euro under the Economic and Monetary Union had significant impact on the currency exchange transactions. In addition, almost all countries set up private banks, made the more central banks more independent, liberalized their financial systems and also joined the IMF
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“Describe the Period of Globalization in International Economic Essay”, n.d. https://studentshare.org/miscellaneous/1564961-describe-the-period-of-globalization-in-international-economic-management.
Impacts on the labour market of globalization were measured in different aspects that composed the labour market such as globalization in trade and markets; employment and wage; financial and wage liberalization; and foreign and domestic investments. Considering all these factors and the position of the UK government which strives to make globalization work for the people of the United Kingdom, the overall picture of the labour market depicts a highly favourable situation for Great Britain’s global economy.
This may according to many lead to the dissolution of national identities and macro influences on the state and the economy tending towards a worldwide convergence towards a single system. (Weiss, 1997 , see Reich, 1990; Cable, 1995).
The concept of the 'global' corporation has been captured in the following phrase 'It has been preceded in the last 30 years by a string of synonyms such as: international, inter-territorial, multinational, transnational, and world-wide' (Weiss, 1997 see Hu, 1992: 120).
Smith and his colleagues continue that the unprecedented volume and velocity of international flows of trade, investment, information, cultural exchanges, and human migrations are creating a new, more tightly integrated, world and one that seems to be in the throes of some fundamental structuring (Smith et al.
However, as a result, the basic relationship between a foreign investor and the host government is one of mutual dependency. The relative strengths of the two sides depict a pattern of bilateral monopolies or oligopolies (Korth 1985).
While both the globalizing and localizing forces are historically strong, it is the ability to innovate and to appropriate the benefits of those innovations in multiple national markets that differentiate the winners from the losers in this highly complex business (Bartlett & Ghoshal 2000).
John (Brewster ,1999) Storey (Beaver, 2004) uses the above quote to show the former community has evolved so much that the community has disappeared. The former society segregation where people can easily describe the attitudes, characteristics, the likes and dislikes of the people living in a particular community has been erased.
Friedman (2005) calls it a flattened world wherein the playing field can be considered as "open and level". Friedman explained how the world has shrunk. Technology has allowed everyone to compete in a levelled playing field within the global marketplace, something which was not possible before the major advances in information technology which we experience today.
Globalization is a subject that has been discussed repeatedly on social, political, environmental and economic fronts. It is the myth of the modern corporate structure and is considered to be driving the contemporary business environment in conjunction with technology.
Trade Representative, this agreement is intended to remove “tariffs and trade barriers” and provide more “regional opportunities for the service providers, workers, consumers, manufacturers, ranchers and farmers” of the countries involved (US Trade Representative,
her hand, economic globalization refers to the increased linkage between livelihoods as well as development of services and products on a global level.
There is a lot of subjectivity about the concept of economic globalization and there is no universally acknowledged concept as
The term globalization can also be explained in terms of market in which the business competes to sell its product and services and the market in which it competes for productive inputs (Scherer et al., 2009).
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