As states develop, they tend to seek the ability to compete on all fronts. One major category that can help determine a country’s overall success is the economy. There has been plenty of concepts and theories constructed to try to come up with the ideal path to a good economy with abundant growth and with minimum issues. As, technology became more advanced and accessible countries were able to communicate very easily changing the economic landscape. The easy communication allows different countries to link up and conduct business with each other. This allowed nations to work economically on an international scale, this is globalization. Thomas Friedman, a New York Times columnist, proposed the idea that participation in the global economy
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He suggest that other economies such as communism doesn’t work and of all the other alternatives ”none can generate income and to distribute as efficiently as free-market capitalism. (Friedman 60) When a country recognizes this than that are eligible to put on the golden strait jacket. If a country wanted to wear the jacket then it had to meet the policy requirements in order for it to fit properly. The essential requirement is to shrink the role of the states in order to let the economy expand. The main idea is that the government should have a very minimal regulatory role in an un-compromised market driven by consumers. This approach successful when used by Thatcher and Reagan who would “strip huge chunks of economic decision making power from the states.. and hand them over to the free market” (Friedman 61) . Countries such as Russia and China had different roles of the state in pursuit of the economic changes promised by Friedman’s jacket. These economic history of these two countries challenge ideas that Friedman presents with the …show more content…
The fall of the Soviet Union required the Russian transition away from communism. In Russia, “after the fall of the Berlin wall there was hope economic prosperity” (Stiglitz 37). They were faced with the difficult task of finding out what system is going to replace it. The communist system of the Soviet Union that was left behind included an economy that was heavily regulated by the state. China also this communist economy. Friedman suggest that Communism wouldn’t work when trying to achieve greater economic success. China’s economic shortcomings preventing them from being competitive made them desire the economic improvements that the straitjacket promises. One of these shortcomings is the uncertainty in how they should introduce monetary policy to regulate the market without running into the same issues that the they felt ruin many capitalistic systems.(Vogel) Also, one of China’s leaders, Deng Xiopeng was dissatisfied with China’s underwhelming growth and growth target, leaving him with a desire for rapid economic growth. An economic problem that existed for both Russia and China was inflation, which is often caused by an increase in the overall price level that decreases the value of the dollar. Russia also battled inflation in the midst of a crisis, there were many people who were hurt by the inflation, including those whose government benefits or wages didn’t change to
He suggest that other economies such as communism doesn’t work and of all the other alternatives ”none can generate income and to distribute as efficiently as free-market capitalism. (Friedman 60) When a country recognizes this than that are eligible to put on the golden strait jacket. If a country wanted to wear the jacket then it had to meet the policy requirements in order for it to fit properly. The essential requirement is to shrink the role of the states in order to let the economy expand. The main idea is that the government should have a very minimal regulatory role in an un-compromised market driven by consumers. This approach successful when used by Thatcher and Reagan who would “strip huge chunks of economic decision making power from the states.. and hand them over to the free market” (Friedman 61) . Countries such as Russia and China had different roles of the state in pursuit of the economic changes promised by Friedman’s jacket. These economic history of these two countries challenge ideas that Friedman presents with the …show more content…
The fall of the Soviet Union required the Russian transition away from communism. In Russia, “after the fall of the Berlin wall there was hope economic prosperity” (Stiglitz 37). They were faced with the difficult task of finding out what system is going to replace it. The communist system of the Soviet Union that was left behind included an economy that was heavily regulated by the state. China also this communist economy. Friedman suggest that Communism wouldn’t work when trying to achieve greater economic success. China’s economic shortcomings preventing them from being competitive made them desire the economic improvements that the straitjacket promises. One of these shortcomings is the uncertainty in how they should introduce monetary policy to regulate the market without running into the same issues that the they felt ruin many capitalistic systems.(Vogel) Also, one of China’s leaders, Deng Xiopeng was dissatisfied with China’s underwhelming growth and growth target, leaving him with a desire for rapid economic growth. An economic problem that existed for both Russia and China was inflation, which is often caused by an increase in the overall price level that decreases the value of the dollar. Russia also battled inflation in the midst of a crisis, there were many people who were hurt by the inflation, including those whose government benefits or wages didn’t change to