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How has the international economy developed in the last 250 years?

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Introduction

Industrialisation and Economics' Development. How has the international economy developed in the last 250 years? ________________________________________________________________________________ Answer: In order to be aware of why a truly international economy first evolved during the nineteenth century it is necessary to consider the economic, technical and other changes which were responsible for the massive expansion of capital movements, migration and foreign trade that occurred during these years. For it was through these flows of money, men and goods that countries until this time economically independent were fused into the international economy. The industrial revolution, which began in Britain in the late eighteenth century and which spread first to Europe and then to the United States during the nineteenth century, enormously increased the opportunities for trade between countries, for the new technology presupposed a wide variety of resources and an expanding market. Industrialisation would never have happened so rapidly if it wasn't for the rapid development of new ideas, methods and machinery. Industrialisation brought about the widespread use of factories, around which towns and cities developed. Many of the factories of the industrial age remain intact today and can be visited to make your understanding clearer. Factories developed simply because the new machinery that was developed in the Industrial Revolution was too large to fit into small buildings and were more efficiently used in a new type of building. Ideally the factory owner could house all of the elements of his manufacturing process in one building, reducing the cost of producing goods and the time it took to make these goods. ...read more.

Middle

The rapidly growing world population had a number of important consequences for world trade. In itself a growing population would have meant some increased demand for those commodities already traded internationally. Taken in conjunction with changes in the other factors of production, however, it greatly enhanced the possibilities of trade. For example, in Europe, with the possible exception of Russia, the land-labour ratio became less favourable as population grew, despite improved farming techniques and the reclamation of waste lands. Land became scarce and rose in price, so that agricultural products became more expensive relative to those obtained from other countries overseas. As agricultural price differences widened, therefore, the opportunities for trade increased correspondingly, while in those countries where the growth of domestic production of foodstuffs failed to keep pace with the population increase, foreign imports had to be relied on increasingly to fill the gap. Moreover, the unfavourable land-labour ratio in Europe had another consequence for the international economy. It forced people from the land into the towns and, when domestic urban employment was unavailable, overseas to the new regions of primary production. In these areas, where labour was short, the rapid growth of the indigenous population, aided by immigration, served only to create more favourable conditions for the exploitation of economic resources, particularly natural resources, which had previously remained un-worked partly because of the lack of labour. Even if accurate measurement of natural resources in economic terms is difficult, if not impossible, the available evidence suggests that a substantial increase in the world supply of natural resources occurred during the nineteenth century. ...read more.

Conclusion

of the international economy in the period since 1820, it is necessary to say something about the growth of foreign trade itself as a major cause of the economic growth of nations. In most countries export growth was a very powerful promoter of domestic economic growth and development. What is also clear from Table 4, which describes the long-run growth of the greater part of the world export trade over the period 1820 to 1989, is that the pace of world economic growth is very closely tied to the rate at which world trade grew during these years. The evolution of the international economy during the period 1820 to 1998 has been largely a response to the changes that have occurred in the political, economic and technological environment within which economic relations between countries are conducted. The record demonstrates the slow but inexorable movement among the regions of the world economy towards greater integration. As a result of a number of developments, international trade increased dramatically in the second half of the nineteenth century, outstripping the growth of world output. Particularly important was the movement towards free trade up to the 1870s, even though it had faltered by the 1880s and was kept alive only by the United Kingdom and a few Continental countries, and the vast strides in steam transport technology which rapidly increased the flows of people and commodities across continents and from one continent to another by sea. This expansion of the international economy provided the mechanism for widespread economic growth in Western Europe and its 'offshoots' abroad. ...read more.

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