So what has this to do with the British government pumping billions of dollars into their economy? What has this to do with the Australian PM guaranteeing bank deposits?
As far as I can remember, economics was a subject that talked about micro and macro economics. In fact, the whole theory of economics is based upon understanding what happens within a closed system. An economy is defined within the borders of the nation.
It seems too obvious for words that we are living in a global economy. Every action has a reaction that reverberates around the world. Such is the case of the sub prime crisis.
Whilst you can read about Globalization there is not much in economic studies that grapples with the concept of a Global economy.
When economists consider economic policy it is still confined within the perimeters of micro and macro but not global.
Whilst hedge funds straddle the world and have the power to influence national economies as much as governments, there seems to be no grasp of the mechanism of global economics within the discipline of economics. There is certainly a lot of groping in the dark, reacting to situations that spin out of control but no systematic way of dealing with the global economy.
You might think that Globalization is something new, a recent development. In which case I suggest you consider that the Great Crash of 1929 was a global phenomenon. Seems to me that the global economy has been up and running for quite some time.
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