Dmitry Rudenko

drudenko@inbox.ru

WORLD ECONOMY AND

INTERNATIONAL TRADE
Lecture 2: Global economy

SpB, 2019
 Rudenko Dmitry

LECTURE FOR TODAY:

World economy
Agents of the world economy
Structure of the world economy
Country classifications
World or global economy
World economy is a complex system of interrelated and
interdependent national economies and other subsystems, functioning
and developing according to the uniform objective laws of the market
based on the historically established international division of labor
(IDL).
World economy is a system of international economic relations, a
universal link between national economies and other subsystems,
including trade, financial relations, the allocation of capital resources
and labor.
 Rudenko Dmitry

World economy and international economic relations:

World economy is a set of national economies and other

subsystems in their interaction and the inherent system of IER.

International economic relations (IER) - economic relations

between residents and non-residents, classified according to
the forms:
international trade in goods and services;
international capital flows;
international migration of labor;
international knowledge sharing;
international monetary and financial relations (mainly currency
exchange).
 Rudenko Dmitry

Globalization:
a process of increasing the interdependence of all
subsystems in the world economy, which is based on the
deepening of the internationalization of production and capital;
a process of transforming the world economy into a united
market for goods, services, capital, labor and knowledge.
The result is the formation of a global economy.

Global economy:
is a unified global system based on the interaction of
national economies, including the unhindered movement of
goods and capital, information openness, rapid technological
renewal, lowering of tariff barriers, a planetary innovation and
technological revolution and international education.
 Rudenko Dmitry

Agents in the global economy:

national economies:
national private business entities (national enterprises and
individuals)
national states (public bodies)
International corporations: TNC, MNC and TNB
international organizations at various levels
trade blocks:
preferential trading area
free trade area
customs union
common market
economic union
economic and monetary union
political union
 Rudenko Dmitry

Structure of the global economy:

Core-Periphery - interaction in the global economy of
developed and developing countries, during which the main
impulses of development come from the Core. Periphery
specializes in supplying energy resources to the world market
and occupies an dependent and subordinate position.
North-South - the division of countries in terms of socio-
economic development by the developed North and the
developing South.
 Rudenko Dmitry

Country classifications:
There are 195 sovereign states in the world (see UN + two
sovereign non-member states of the UN - Palestine and the
Holy See), 62 dependent territories and a number of disputed
territories (http://www.polgeonow.com/).
Sovereign state is a politically independent state with
independence in all domestic and international affairs.
Territory - land that does not have a sovereign status, with
limited local government rights, or land with an uncertain
status.
See how many countries single out in their stats. data of
UNCTAD, UNDP, IMF, IBRD.
Rudenko Dmitry
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