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World economy

World economy. Economic science can be divided into microeconomics, macroeconomics and world economy. Microeconomics is about enterprises. It is microeconomics that is able to explain how economic decisions are made at the lowest levels, in particular, how buyers decide to purchase something and how their choice affects prices and incomes of companies. Also, microeconomics is able to explain on what basis firms form the number of workers, as well as where and how much they need to work.

Macroeconomics studies how the economy functions as a whole. This concept includes, for example, the national economy, which is a long-established set of all industries and industries of the state. Macroeconomics deals with those issues that microeconomics are not able to answer. The main problems that macroeconomics deals with are unemployment, economic growth, price levels, etc. As for the world economy, it is a multi-level and global economic system that unites many national economies of the entire planet. This is done with the help of the international division of labor on the basis of the system of international economic relations. One way or another, the world economy is the sum total of all national economies. In addition to national economies, the world also includes transnational corporations and banks, financial and industrial groups, major exchanges and entrepreneurs, as well as international economic organizations. The world economy is directly related to the geography, history and ecology of the planet.

Today, it is customary to single out four dominant forms of the economy. These are market, administrative-command, traditional and mixed economies.

A socially oriented market economy is an economy for which there is a characteristic variety of forms of ownership, free enterprise, market pricing and contractual relations between subjects. The influence of the state on the market economy should be minimal. The most important factor in a market economy is market self-regulation.

Speaking of a market economy, it is impossible not to mention the open economy, so characteristic of market relations. An open economy is an economy that is most effectively integrated into the global economy. In addition, each entity in a state with an open economy can import or export goods, as well as conduct various financial transactions. Currently, there are small and large type of open economy. The first type means a state that seriously affects the global and international market. The second type is characteristic of small states with a small economy, which is not capable of critically influencing the processes occurring on the world market. The most important criterion for an open economy is the favorable investment climate of the state.