With industrial nation's economy dwindling, what would be the fate of developing countries in the current scenario? Do we think the word 'Capitalism' needs re-engineering or shall we argue for a better economic model yet not seen by humans of our generation. This constant thought continuously strive in me with respect to developing countries association with developed nations. Markets have failed to adjust themselves as promised by the concept of free markets;however, with no better economic model lying in front of us, once again we are the beggers to accept harsh realities of Capitalism. It would be interesting to see the mixture of semi-controlled economy where the rights of free markets are limited to an extent that they do not earn incredibly high profits at the cost of other organization. But, how can you control the environment? Who control's the flow of information? We do not need government interference to dictate supply and demand practice nor we need any sort of monopoly. Can all this be achieved in a realistic environment? The search for the term 'best economic model' continues...
About Me
- Sameer Hassan Siddiqui
- A dual undergraduate degree holder in the field of economics and finance from The University of Texas at Arlington. I take interest in discussing various economic/political issues faced by the developing nations in contrast with the developed world. I've created this blog for one such purpose and expect folks to come up with an un-biased analysis in dealing with the macro-economic crisis.
3 comments:
The "best economic model" is the free market. The current economic problems exist because the market was not free. Government loans, artificially low interest rates from the Fed, and regulation of the risk mitigation employed by banks artificially increased home-ownership and turned what was a stable, profitable market into a bubble.
The word "capitalism" needs to be re-engineered to mean "no government influence."
In a free market, only people who can afford houses own them. Is it possible for a democracy to accept this cost in the short term in exchange for avoiding economic crisis in the long term? Not as long as people "Hope for Change."
Free market has never existed and prolly never will. Politicians will always meddle to try to benefit their favorite lobby group. Too big to fail and systematic risk caused by major financial firms is also working to undermine the free Mkt argument.
Therefore, we need to realize that there is a need for regulations on international levels. Not national levels where it always undermines globalization.
In short globalization is good but only with international regulatory board.
Paul, with respect to your observation, don't you think democrats are asking something similar? Not that I'm against of any party, but republicans have shown some strong government influences on the concept of 'free market' from time to time till democrats came into senate.
Waqar, which country(countries) defines international regulations? Is it only the 'developed(G8)' nations or 'developing/under-developing' nations should be allowed to raise their voices too? In my opinion the 'G8' factor has failed tremendously. I opt for allowing latin america and advanced asian economies in 'G8' board.
Not to forget, Russia without accepting 'Capitalism' model is on a good economic track!
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