This paper examines the two most important current efforts to devise new rules binding all nations; the negotiations in the WTO of trade rules and the negotiations under the UN Framework Convention on Climate Change to devise rules restricting the annual emissions of greenhouse gases. Both negotiations have failed after several years of intensive effort. There are remarkable parallels in these negotiations. Both have used the same approach to negotiations; consensus decision-taking, a bottom-up approach and differential treatment of Developing Countries, and complex modalities. These features have made the negotiations tortuous. Major changes in international relations have made agreement impossible to date: large global market imbalances and changes in geopolitical balances have produced a general distrust among major parties and an absence of leadership. What is needed most of all is a common or shared vision of the gains from binding multilateral rules for the world economy.
Libya experienced a substantial increase in oil revenue as a result of increased oil prices during the period of the late 1970s and early 1980s, and again after 2000. Recent increases in oil production and the price of oil, and their positive and negative macroeconomic impacts upon key macroeconomic variables, are of considerable contemporary importance to an oil dependent economy such as that of Libya. In this paper a dynamic macroeconomic model is developed for Libya to evaluate the effects of additional oil revenue, arising from positive oil production and oil price shocks, upon key macroeconomic variables, including the real exchange rate. It takes into consideration the impact of oil revenue upon the non-oil trade balance, foreign asset stock, physical capital stock, human capital stock, imported capital stock and non-oil production. Model simulation results indicate that additional oil revenue brings about: an increase in government revenue, increased government spending in the domestic economy, increased foreign asset stocks, increased output and wages in the non oil sector. However, increased oil revenue may also produce adverse consequences, particularly upon the non-oil trade balance, arising from a loss of competitiveness of non-oil tradable goods induced by an appreciation of the real exchange rate and increased imports stimulated by increased real income. Model simulation results also suggest that investment stimulating policy measures by government produce the most substantive benefits for the economy.
Implementing a currency union may lead members to face financial crisis if their financial markets are not ready to adopt themselves to a new situation. There are still problems like ownership concentration and self-governing states cause limitation in economic growth, financial development, and the ability of a country to take advantage of financial integration. The evidence is that the proportion of global financial flows dedicated to the low- and middle-income developing economies, decreased after the Asian crisis of 1997-98 (Das, 2006). These problems explain why the impact of financial integration has been limited and why it can lead to capital flight and financial crises. In this study, we develop an analytical framework of economic growth and assessing special and differential treatment of currency union (a subject of financial integration) members (like the EU) and apply this framework to MENA countries. We propose specifically that one can evaluate the ""average"" impact of the currency union membership on growth of the countries. It reveals the fact that the routine program evaluation can be for all the EU and MENA members. We will call this treated or untreated, respectively. Next, we predict such outcomes for a group of countries based on matching of their characteristics. Hence we use the matching method to make a relationship between a response variable (economic growth) and a treatment variable (financial integration) experimentally in the economies of the EU and MENA.
The excess liquidity of the open economy has become one main factor influencing the monetary markets, financial markets and even the whole macroeconomic. In era of the post-crisis, many countries have implemented the loose monetary policies, especially the quantitative easing policy in the U.S. which worsened the situation of the excess liquidity. Under this background, it will be more meaningful to study the excess liquidity of the open economy and its management for the developing countries’ economic recovery and development, inflation control, economic structural adjustment and optimization and the stability of the social economy. This paper starts by deep study of the related theories of the excess liquidity and the transmission mechanisms and then has an analysis on the current situation and cause of the excess liquidity in the BRICs which is taken as the representative for the developing countries. And then it comes up with the point that the main cause of the excess liquidity in the developing countries is the financial system, including loose monetary policies, financial innovation, petrodollar, East Asia dollar, US dollar hegemony, overcapacity, trade supply, savings supply and the surge of foreign exchange reserves etc. With the help of the Impulse response model from the VAR model, this paper analyzed on the impact of global liquidity surge to America, the euro zone, Japan, China, India, Russia, Brazil etc. and came to a conclusion: 1. The global excess liquidity keeps increasing. And its speed in the developing countries is fast while slow in the developed countries. 2. The spillover effect of the global excess liquidity spreads mainly through GDP and price. And for most countries, the international factor has more influence on the rising price than the domestic factor. Besides, the GDP has also been affected to fast grow which in turn becomes the main driving force of quantity increase of money. 3. The openness and development level of the economy is not the decisive factor in the excess liquidity’s spillover effect. However, the structure of the macroeconomics and the management level discrepancy are the root causes of the influence difference among countries. Last but not least, combining the new situation of the International economy and the current situation in developing countries, this paper raises some suggestions.
The Major Determinants of Sustainable Development in Selected Pacific, East and West Asian Countries
Sustainable development is a Controversial concept which has been considered over the three decades. It is comprehensive development and includes all of dimensions as “economic’’, “social’’ and ‘‘environmental’’. In economic objective, it requires substantial economic change that can be brought about by investment and trade. They are effective factors of sustainable development for all countries. This paper provides useful information of these issues. We analyze the relationships between trade, investment and sustainable. Using the average of annual time series data from 1990 to 2009, we apply Analytical Hierarchy Process (AHP) to countries classification. The results indicated that economic factors are key criteria to achieve sustainable development while China has the highest priority among the selected countries.
Nowadays, the world economies are rapidly moving towards being more Knowledge-based Economy (KBE) and supporting the force of knowledge as a vital component of economic growth. This recent acceleration in the transition to Knowledge-based Economy in the world, has affected regional economic performance. In this paper, we surveyed the regional convergence in Knowledge-based Economy for selected Asia and pacific countries. We used a growth model in Barro and Sala-i-Martin framework (1995) for the period of 1995-2009. It includes a panel data set consisting of the annual growth rate of GDP per capita for selected Asia and pacific countries and a group of indicators that define the situation of Knowledge-based Economy in countries. The empirical results indicate that the absolute and the conditional convergence are not rejected for selected countries. The investigation on robustness of the model results confirms the existence of regional convergence for studied countries.