Theories Of Global Commerce

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Theories of global commerce Question One: Discuss how the theories of global commerce have evolved over time. According to Beinhocker 2008 the traditional theories of global commerce were developed from the nineteenth century theorists Vilfredo Pareto. The Pareto distribution model describes the 80-20 theory. Where 80% of the wealth belongs to 20% of the population. Beinhocker discusses the idea that economies develop even in the most simple of societies without any infrastructure or todays influence. During the sandscape experiment it was discovered that economies would develop as part of human behavior – it makes sense to trade when it will better off both parties. Over time the global economies have developed from simple trade of resource based upon the economic supply and demand curve in relativity to a more complex structure of borrowing and lending. Question Two: Explain the factors that might have influenced the evolution of theories of global commerce? Beinhocker 2008 explains the factors that have affected evolution in comparison of complex economies to traditional involve the process of “differentiation, selection and amplification provides the system with novelty and is responsible for its growth in order and complexity” Question Three: why is economic globalization such a contentious issue? Economic globalization takes complex economies to a new level. The simplistic traditional approach of trade and lending and borrowing supports the needs of society, however global economies take personalization out of trade to something more universal such as having access to almost any product that you desire. Globalization of the economy will take consumerism of todays age to an even more extreme level as technologies improve. Markets are able to exploit others due to the dollar in the
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