World economy and world market

The main forms of the international economic relations are world trade, migration of the capital and labor, currency cooperation.

World trade assumes movement of goods and services out of limits of frontiers. It leads to specialization and an exchange. Specialization and exchange allow to raise a standard of living by two ways.

First, by means of trade benefit is derived from a difference in expenses in different countries. This benefit follows from a difference in the technologies, different degree of availability of raw materials or other production factors. The first who, described this benefit was A.Smit. He claimed that each country has to specialize on production of those goods where it has an absolute advantage. Developing this idea, D. Ricardo formulated the principle of comparative advantage: the countries specializing on production of goods, have to make goods which they can do by rather lower expenses in comparison with other countries.

Secondly, by means of trade it is easier to receive economy from scale, i.e. to lower expenses at the expense of increase in output.

At the heart of the world economy created on the basis of national economies and economic relations among them, the international division of labor lies which assume specialization of production of the certain countries on certain types of production.

In structure of barter and in the directions of the main foreign trade streams there are continuous shifts that change position of different countries in the world market. They are expressed in the fact that the specific weight of raw materials is reduced and the share of hi-tech goods increases; trade of services grows: transport, tourist, financial.

Migration (export) of the capital is abroad placing of means bringing income to the owner. This process is promoted by a number of reasons:

1. overaccumulation of the capital in the country, from where it is taken out

2.discrepancy of demand for the capital and its offer in various links of the world economy

3. presence of cheaper raw materials and labor in the countries where it is exported,

4. production internationalization

The capital is taken out in the following forms:

1.in a form of private and state

2.in a monetary and commodity form. So, export of the capital is movement of cars and the equipment, patents, a know-how if they are taken out abroad as a contribution to authorized capital of firm created or bought there

3.в short-term (it is usual term till one year) and long-term forms.

4.in enterprise and loan forms.

Export of the enterprise capital is carried out in the form of direct and portfolio investments. Direct investments provide complete control over objects of foreign capital investments owing to full property on the spent capital, and also possession of a controlling portfolio of stocks.

Portfolio investments are formed by acquisition of stocks of the foreign enterprises in the sizes which aren't providing the property right or control. The capital in a loan form brings the income to his owner generally in the form of percent, loans and credits.

3.репатриация (возвращение в страну происхождения ранее выехавших из нее граждан)

International migration of labor

It represents movements of labour resources from one country to another for the purpose of employment on more favorable conditions, than in the country of origin. Migration of labor is expressed in three concepts:

1.emigration (departure from the country on a constant residence)

2.immigration (entry into the country on a constant residence)

3.repatriation (return to the country of origin of citizens who have earlier left it)

The USA, Germany, Israel, oil-producing countries of the Middle East and the Persian Gulf became the centers where foreign workers and experts would like to in recent years.

In process of development of the international economic relations there is the world currency system, helping to carry out calculations between the states, the organizations, firms and citizens.

The world currency system in modern conditions includes national currencies and collective reserve currencies, including gold reserves; conditions of mutual reversibility of currencies, mechanism of currency parities and courses, volume of currency restrictions, forms of international payments, mode of the international currency markets and world markets of gold.

The modern currency system is, in essence, the multi-currency market standard.

The modern currency mechanism regulating the modern currency relations, has the following main lines:

1.currency unit lost its direct link with gold that found the reflection in elimination of the official firm price on it.

2.gold ceased to be a general instrument of payment not only in the internal circulation of the country, but also in the world market.

3. gold remains liquid goods which can be sold for money, and this money can be used for international payments.

The currency is the capacious concept including:

1.monetary unit of the country and its type (gold, silver, paper)

2.monetray signs of the foreign states, and also credit means of circulation expressed in foreign monetary units.

3.international calculating units and means of payment (EURO)

In the market where currency transactions are carried out, the currency is sold according to an exchange rate. Currency rate is a price of monetary unit of one country, expressed in monetary units of other countries. Process of establishment of a rate of national monetary unit in foreign currency is called as the currency quotation.

There are some options of establishment of rate relations between national and foreign currencies:

1.floating currency rate is the rate of national currency in relation to foreign freely fluctuates depending on supply and demand

2.fixed rate is -national currency is rigidly attached to other currency.

3.regulated floating is the rate of national currency fluctuates until changes don't reach a certain limit then the state starts using regulating levers.

Дата добавления: 2015-08-20