Economic Growth and Development in the Global Economy

This article discusses the concepts of economic growth and development in the global economy. It explores the qualitative changes and interconnections in the world economy, and the factors influencing globalization. The article also explains the difference between economic growth and development.

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Economics
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Introduction
The global economy is the economy of the humans of the world that is considered as
the international exchange of the goods and services which is expressed in terms of monetary
unis. The economic growth is basically quantitative change in nature, however, the economic
development can be both quantitative as well as qualitative in nature. Economic system is
known to be composed of all the entities which is known to describe the system.
The alterations in the economic system is known to take place during the time of economic
development. These changes are known to be qualitative in nature since the new entities are
known to be completely different and also non comparable with the existing ones. It have
also found out that the economic development is known to be accompanied by the changes in
the composition of the economic system.
The technological innovation are known to create qualitatively new entities. The presence of
the qualitative change in the development of economy is known to responsible for modelling.
It has also been found that the term of qualitative changes are rarely used by the neo
Schumpeterian economists. However, the qualitative changes of global economy plays an
important role in the work of Schumpeter. The existence of the change in quality among the
products is known to be present since the beginning of modern economics.
Countries like Malaysia, Indonesia as well as Thailand is known to display extremely huge
growth of manufacturing growth. The importance of the East Asian economies is known to
be marked in the sphere of exports. The entry of the massive labour force of china in the
global economy is known to prove the most profound change for 50 years. The development
of china is a powerful driver of the global growth and its impact on the other economies is
also known to be far pervasive in nature. On the other hand, the Latin America as well as the
Caribbean region is known to face a crisis development whose growth. the modest economic

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performance contrasts markedly with that of East Asia. However, the average growth of the
gross domestic product from 200 had been slightly higher than the world average. Most of the
national level quantitative data does not reflect the qualitative changes taking place in the
global economy. There is an existence huge transformation in the nature and the
interconnection degree in the world economy. There have been also a change in the speed in
which this connectivity takes place which includes both stretching as well as intensification
of economic relationships. Therefore, the world economy is known to be a qualitatively
different place from what was there 60 years ago. The international economic integration
before the 1900s, had been quite shallow in nature where only small portion of trade in goods
and services used to take place between the firs. However, presently, there is a presence of
deep integration between the geographically extensive and the complex global production
networks through various mechanisms increasingly. Such kind of qualitative changes are not
captured in aggregative data of trade and investment. In the modern world there had been a
huge increase in both the intra firm as well as intra industry trade. Both of these are the more
functionally fragmented as well as geographically dispersed process of production. Moreover,
there had been a dramatic change in the operation of financial markets where money moves
electronically round the world at an unprecedented speeds. One of the main characteristics of
the global economy is the qualitative transformation of the economic relationships across the
geographical space. The development of the US investment bank is also known to change
qualitatively since the 1980s.
The key characteristics of globalization are technological change, economies of scale,
changes in the tax system, reduction of protectionism, growth in both the transnational as
well as multinational companies.
The forces which surrounds the global system of production are:

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 Multinational corporations which is known to operate in many nations. The rise in the
firms have local production and suppliers operate across the national boundaries
which secures labour, capital as well as other resources which is known to influence
the global economy.
 Shifts in market conditions as well as demand. The economic cycles are known to
affect the markets and the production. The application of the new technology can
mean there is a presence of product oblescence which can be described as product life
cycle.
 Enabling technologies can enhance transportation and communication services. The
technological progress is known for economic growth.
Over the last two decades, trade is known to completely transform the global economy. In
today’s word more than one fourth of the total global production is known to be exported.
From the historical perspective, there had been two waves of globalization. The global
economy is the economy of the humans of the world that is considered as the
international exchange of the goods and services which is expressed in terms of monetary
unis. The economic growth is known as the increase in the value of everything produced
in the economy. The economic growth is known to increase the gross domestic of product
of the country. It is known to allude the increase in per capita national product over a
period of time. The rate of growth in increase in total output should be greater than the
growth rate of the population. The economic growth is different from the economic
development which states that the increase in the economic wealth of a country is for the
welfare of its residence. The economic growth is basically quantitative change in nature,
however, the economic development can be both quantitative as well as qualitative in
nature. Economic system is known to be composed of all the entities which is known to
describe the system The first wave took placed during the 19th century and the other one

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took place after the Second World War and is still known to continue. The trade
transactions include both the goods and services and the production chains of these goods
are known to become increasingly complex as well as global in nature.
The global economy is the exchange of gods as well as services which are integrated into
a huge single global market. the global economy is a world without the borders that is
inhabited by the marketing individuals. The pace of globalization has increased a lot as a
result of:
 Development in communications and transport which have accelerated the pace
of globalization over the past years. The internet is known to enable fast global
communications which has enabled vast quantities of goods and quantities that
needs to be shipped across the world for low cost.
 The rise of electronic payment systems which includes e wallets, mobile pay,
mobile pay apps and e invoices facilitates the increased in global trade.
 The increase in the capital mobility known to have acted as a stimulus to the
globalization. When the capital can move freely from one country to another, it
will be easier for the firms to invest abroad.
 There is also presence of rise in trade which has known to become increasingly
free in nature. The increased trade is known to become increasingly free in nature
which collapsed the communism. In the last decade, the trade openness has known
to increase from 25 percent to 40 percent for the industrialized economies.
The economic growth is known as the increase in the value of everything produced in the
economy. The economic growth is known to increase the gross domestic of product of the
country. It is known to allude the increase in per capita national product over a period of
time. The rate of growth in increase in total output should be greater than the growth rate of

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the population. The economic growth is different from the economic development which
states that the increase in the economic wealth of a country is for the welfare of its residence.
The economic trend of the country is known as the major component for the business
environment. The growth in the economy is known to be expressed in terms of gross national
product and gross domestic product which helps in measuring the economy size. It is known
to be an outcome of the increase in quality as well as quantity of the resources along with
technological advancement.
Conclusion
Most of the national level quantitative data does not reflect the qualitative changes
taking place in the global economy. There is an existence huge transformation in the nature
and the interconnection degree in the world economy. There has been also a change in the
speed in which this connectivity takes place which includes both stretching as well as
intensification of economic relationships. Therefore, it can be said that economic growth can
lead to quantitative change while the economic development is known to bring both
qualitative as well as quantitative change

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