International Relations Theory and Global Economy Essay

International Relations Theory and spherical Economy - Essay ExampleInternational Relations Theory and Global EconomyGlobal economy is the combination of all the economies of the worlds countries. The valuation of the world economy can be arrived at by representing it in a trustworthy currency like the US dollars. Each country experiences a trade oscillation where the rate of produce of expenditure, incomes and production changes over a period of time. The duration and effects of these cycles be dynamic simply because the structure of the economy is developing. This may be caused by theoretical relationships between different variables, for example, unemployment and inflation which might gift changed. This poses many challenges to policy makers as they try to control the economy and meet their objectives. Taking the economic growth of a country, for example the U.K., and analyzing how it has been for the past eld, it is possible to bed that the country has experienced many s hortcomings to date. Notably, the UK has experienced recession and boom periods in the process of its economic development. Just to highlight near key areas contributing to the growth of the U.K economy, one is strong consumption. Consumer spending has contributed positively and has had positive effects to the economy like, absorbing some of the weaknesses of the export and investment sectors. However, this has not come so considerably because it has its limitations, which include additiond debts and increase in rentals. Low investment in capital equipment has also led to growth in the economy as some of these major investments were left to the private sector to cover.3. Growth of the economy globally has main stages like the economic boom. A boom is a situation that occurs when piggy domestic product grows faster than the trend growth rate. At this period, aggregate consider is high, and businesses increase production and employment. Due to high demand, prices may also increas e which translates to cost push and inflation in demand. Demand for imports increases because of high marginal propensity of importation among customers. Revenues from tax increase as more people are in employment and earning, hence, they spend more money. In addition, company realizes high profits as production increases, thus, increasing sales due to high demand in turn leading to high investment. Labor is used exhaustively at minimal costs, that is, no extra labor is needed. The other economic cycle is the economic recession which is a decrease in national output4. Every aspect of the economy is restrained to its maximum. This is a period where the economy is operating to a lower place its breakeven point. As the negative part of the economy, it can lead to increased unemployment, low income per head, international insecurity as many become jobless increased inquisitive debts and the end result of all this is conflicts. The table below gives an illustration of the economic grow th of the UK and inflation rate in the country for the past few years Resource http//www.economicshelp.org/images/macro-graphs/econ-growth-inflation-dec-2011png.jpg Further still, global economy has attracted the centre stage in international politics of late. Politicians cannot do without bringing the issue of economic growth and condescend to the world as they try to appeal to the world to consider them in election to top seats. They lay down structured policies on how they are divergence to deal with the monster