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Contemporary World Lesson 3 Evaluate

The three sectors that shape and influence the global economy are governments, multinational corporations, and global institutions. Governments regulate domestic business markets and influence economic stability through fiscal policies. Multinational corporations stimulate economic growth through foreign investment and job creation. The Bretton Woods system replaced the gold standard and established the US dollar as the global reserve currency, giving the US dominant economic power. It also created the IMF and World Bank to administer the new monetary structure. According to Wallerstein, the Philippines belongs to the peripheral countries in the global economy due to its lack of capital and underdeveloped industry making it dependent on core countries. While still peripheral, the Philippines economy has grown in recent years.

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2K views2 pages

Contemporary World Lesson 3 Evaluate

The three sectors that shape and influence the global economy are governments, multinational corporations, and global institutions. Governments regulate domestic business markets and influence economic stability through fiscal policies. Multinational corporations stimulate economic growth through foreign investment and job creation. The Bretton Woods system replaced the gold standard and established the US dollar as the global reserve currency, giving the US dominant economic power. It also created the IMF and World Bank to administer the new monetary structure. According to Wallerstein, the Philippines belongs to the peripheral countries in the global economy due to its lack of capital and underdeveloped industry making it dependent on core countries. While still peripheral, the Philippines economy has grown in recent years.

Uploaded by

jasslyne
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Jasslyne D.

Gildo BSA 2-A

1. What sectors shape and influence the global economy’s operation? How do they interact
with each other?

The sectors that shape and influence the global economy are the government, global or multinational
corporations (mcns) and global institution. The power of government is a significant economic force in
all the business markets. The government may decrease or increase spending as a means of stabilizing
prices or loosening unemployment through its fiscal policies. The government may also increase or
lower the corporate taxes. Other business markets, such as banking, trading, manufacturing, and
medicine are highly regulated by government. When multinational companies invest in a country, they
create opportunities for jobs. They account for increased income and expenditure in the country's
economy, which stimulates growth.

2. How did the world transition from the gold standard to the Bretton Woods system? What
was its immediate impact?

A new global monetary structure has been established in the Bretton Woods agreement of 1944. It
substituted the US dollar as the world currency for the gold standard. By doing so, America was known
as the world's dominant force. America was the only nation with the power to print dollars after the
agreement was signed. The agreement established the World Bank and the IMF, U.S.-backed
organizations which were to administer the new structure. The IMF was designed to monitor exchange
rates and lend reserve currencies to nations with trade deficits, the World Bank to provide
underdeveloped nations with needed capital — although each institution's role has changed over time.
Each of the 44 nations who joined the discussions contributed a membership fee, of sorts, to fund these
institutions; the amount of each contribution designated a country's economic ability and dictated its
number of votes.

3. According to Wallerstein’s world-systems analysis, to what group does the. Philippines


belong? Is his analysis reflective of current Philippine conditions? Explain.

According to Wallerstein's world system analysis, the Philippines belongs to the Periphery countries.
Periphery countries are dependent on core countries for capital and have underdeveloped industry. If
we reflect this analysis with the current economic standing of the Philippines, we can confirm that
Philippines is a peripheral country. Up to this day, PH still lacks capital and technological infrastructure
to compete with semi-peripheral and core countries. We are still dependent to the core countries when
it comes to capital thus making us easy to exploit. The large population and political instability also are
factors affecting the countries growth. The Philippines despite being a peripheral country is developing.
The economy advanced 5.6 percent year-on-year in the first quarter of 2019, easing from an upwardly
revised 6.3 percent expansion in the previous quarter and below market consensus of 6.1 percent. If our
country is able to maintain high levels of growth while stabilising its population, it has a good chance of
escaping the poverty trap and step out of the peripheral box.

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