Globalization Issues

25 Pages 6310 Words

et capitalism and liberal democracy. Free markets, transparency, and flexibility are the watchwords. The "electronic herd" moves vast amounts of capital in and out of countries according to their political and economic merits. Capital moves almost instantaneously into countries with stable governments, progressive economies, open accounting, and honest dealing, and out of countries lacking those qualities. States can defy the "herd," but they will pay a price, usually a steep one, as did Thailand, Malaysia, Indonesia, and South Korea in the 1990s. Some countries may defy the herd inadvertently (the countries just mentioned); others, out of ideological conviction (Cuba and North Korea); some, because they can afford to (oil-rich countries); others, because history has passed them by (many African countries).
Countries wishing to attract capital and to gain the benefits of today's and tomorrow's technology have to don the "golden straitjacket," a package of policies including balanced budgets, economic deregulation, openness to investment and t...