What policies should inter-governmental organisations advocate in managing in the global economy?

Question

Please give pointers and areas to research. I have to give a presentation and have never done Economics before. Help would be greatly appreciated. Kind regards Colin

Answer 1

1. Free-floating exchange rates. Nothing distorts the price signals in an economy as destructively as an artificially propped up exchange rate.

2. Free trade, or in the case of very poor developing countries that need the revenue from tariffs, consistent, transparent, non-discriminatory tariffs.

3. Minimising the risk of and damage from corrupt government.... the cleverest way, I suggest, was the Malaysian model in the first 30 years of that country: so arrange things that government ministers are fee-earning directors of the companies that deserve to win the govt contracts. Promote government selected through competitive elections.

4. Internal free markets.

5. Market provision of services that the government sees fit to make available at no cost or subsidised cost to the user e.g. roadbuilders should compete for roadbuilding cnotracts even if the use of roads is not charged for; similarly, school entrepreneurs should bid for the operating of schools even if parents are charged little or nothing for the education provided.

6. Clear, consistent business legislation, honestly enforced, and non-discriminatory between domestic and foreign businesses.

7. An open door to foreign direct investment in all countries.

8. Open, transparent financial markets in all countries.

9. The promotion, both in schools and in business practice, of human values such as love and compassion, truth and honesty, peacefulness and serviefulness, and moral integrity.

Answer 2

It is not the responsibility of Government to "manage the economy". Government is supposed to govern. That means that, in addition to guarding the borders, the Government should resolve disputes within those borders and defend the lives, liberties, and property of those who live within those borders.

All Government does is mess the economy up, when it gets involved. Look at the housing bubble. That was caused by Government policies that used agencies like Fannie Mae to dump boat-loads of money into the housing sector. All that extra money caused prices to increase. Now, we're starting to pay for that boom because housing prices are starting to go down. The reason? People have borrowed so much money that they can't borrow any more. So prices can't continue to rise. And the people who bought houses when they were at the highest price? They're screwed, and will find out that they owe more on their houses than the houses are worth.

What about the stock market boom, that happened before the housing boom? This was caused by the Government flooding the economy with money after the Asian financial panic, the Long-Term Capital Management crisis, the Mexican peso crisis, etc. Again, all that money flooded into the economy and wound up in the stock market, where stock prices went up ELEVEN TIMES from their lows in the early 80s.

All Government does, when it tries to manage the economy, is cause a boom in certain sectors, through their meddling. But this boom is, naturally, unsustainable, so it is followed by a bust. So the government tries to "fix" the bust, and causes more problems somewhere else. Which it tries to fix, causing more problems somewhere else. Meanwhile, the Government goes deeper and deeper into debt, which is a drag upon the future economy.

Government should stick to its primary function, which is to govern. It should leave the economy alone. Booms and busts would be MUCH less severe, if there were no Government interference in the economy.

Answer 3

top priority needs to be given to environmental responsibility and renewable resources- if we continue to deplete our natural resources and pollute our environment there will be no global economy to even worry about-this needs to be a united effort-we are many different countries- but this planet we share is everyones-and we need to clean up our act- or else