The Rise of Developing Economies in the Globalized World

The New World
by Neal R. Karski

The world today looks nothing like it did it two hundred, hundred or even fifty years ago. The times of imperialism appear to be almost over, and many nations on the other side of the globe are not ruled by their occupants via means of frigid treatment and limited freedom. Yes, the business influences and viewpoints have spread around the world and a vast amount of entrepreneurs traveled to foreign lands to pursue their ideas. Earth has now become a mix up, where the melting pot explodes with booming [previously underdeveloped] economies. The reality is at the horizon; no nation can dominate solely and for the entirety of contemporary history.

There are a few notions that I believe one should take into account to analyze and comprehend this phenomenon…

United States depression has paved path for other economies to show their potential. With the decreasing value of the dollar and the failure of finance corporates in the wealthiest nation, others, like China, have stepped up their game to utilize their investments and contribute to their technological, educational and commercial growth.

The population size of the countries with developing economies has allowed them to implement the mass production systems with low labor wages. These systems, initially, were closely similar to the ones of the United States, yet enhanced by the many more able hands willing to work and live in lower and less adaptable standards. Sometimes business takes an unjust advantage of the necessity of survival… but each nation has its own way of leveling the economy.

The world is flat – A.K.A. Globalization. Yes, the pun was intended to suggest to you the book by Thomas L. Friedman, who through excellent language and descriptive story telling shared his theory on today’s competitive world and its very narrow room for coincidence in the economic trends. The battle field has now widened, connected its many corners via technology, and opened doors for nations like Brazil and India who struggled to truly put themselves on the map of economic decision makers in the global stock markets. We all used to say… “Well Russia will never catch up” or “China makes good Nikes, but that’s about it”.

The reality is, the competition is not only within the U.S. now. It’s global. And many economists have predicted that it’s their turn… the round of rising developing economies.

God Bless.

Rise or Fall? Developing Economies and the Notion of Globalization
by George A. Miu

Look around you. I’m willing to bet all my readers that there is an object that is inscribed “Made in China” within ten feet of you. Even if you do like to buy American. Well, I guess China isn’t a developing economy any longer, but this doesn’t change the fact that there are a lot of goods floating around that are made in third-world countries and sold cheaply over here.

Such is the nature of a global economy. Some are buying, others are selling, and everyone is doing something or other. Now, consider this:

A “developing economy” makes a certain product, whatever it may be. If this product is sold for profit on another continent, most of the extra dollars that are made are kept by the big corporations. A little goes through to the workers and the factory. Most developing countries deal with at least one of the following two problems: political instability and high levels of poverty.

The little money that the workers do earn is by no means enough to elevate them above the poverty with which most factory workers contend. Since vast numbers are employed in this field, especially if the country is a big “producer” of certain goods, the poverty level is not helped by this mercantile trade pattern. Indeed, the only ones who become “rich” are the owners and the political elite…

…which brings us to the concept of political instability. In dictatorships, or strict systems of government under which most third-world countries operate, the government’s money comes from abroad and by virtue of the upper-classes who want to maintain their privileged status. Therefore, feeding money into factories and such will only help bolster a government that does not permit the wealth to be evenly distributed in proportion to the individual’s value in terms of productivity. Hence, the political instability is renewed, as the majority of the populace will feel cheated by their leaders.

On the other hand, building factories and boosting production is how all countries must develop; oftentimes, this is a painful process in which the human sacrifices are astounding. Remember that China, the world’s largest producer of … anything … is now considered a powerhouse in economic terms, whereas in the not-too-distant past they, too, were deemed to be a “poor country”. This shift may have occurred due to the globalized economy, or a variety of other reasons (which will be the topic of another post).

The question here is this: ought we to permit a global economy to occasionally run riot against the interests of untold millions, for the benefit of fewer millions, in the hope that all will turn out well? Or is it not worth it? If not, what alternatives do we have that are even remotely plausible, considering the oft-selfish nature of human beings? And why does this feel like 20 questions?