How Hegemony Of Developed Countries Have A Huge Effect On Global Economy

987 Words Jan 18th, 2015 4 Pages
uestion: How hegemony of developed countries’ curriencies make contribution to their developments and how the hegemony can be ended?

The curriencies of developed countries have a huge effect on global economy. Some of generally accepted curriencies around the world are dolar, euro, pound, frank and yen. And it is a well known fact that those are the curriencies of developed countries. The ambiguous part is that whether their curriencies make them developed or their curriencies are accepted around the world because there are developed. There are indeed close relationship between reason and result, i.e there is a causality dilemma, which came first is uncertain like in the example of the chicken or the egg. The curriencies of developed countries are used in international trade because their economies are more powerful than the others, so they set up the rules of the trade and which make them even more powerful. Thus, it is a kind of vicious circle. Lets consider about the hegemony of dolar to become more precise, because dolar is the most accepted curriency in global transactions. One of the important concepts is current account deficit to be able to understand how curriency used in global economy is essential. Current account deficit is simply consuming more than producing, which means the countries which have current account deficit, consume commodities or services which they can not produce. ( i.e imports of the country are more than its exports.)…

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