Definition of Global Economy and Market Integration

1. GLOBAL ECONOMY
Prepared by: Elsie Joy Licarte-Misoles, LPT
Lesson 1

2. Learning Objectives
At the end of the lesson, the students are expected to:
a. define global economy;
b. gain understanding about the concept of
global economy;
c. explain the role of international financial
institutions in the creation of a global
economy; and
d. discuss how economic globalization works
based on world current issue.

3. WHAT IS GLOBAL ECONOMY?

4. The world economy or global economy is the
economy of all humans of the world, considered
as the international exchange of goods and
services that is expressed in monetary units of
account.

8. Situation:
Suppose that you are an online seller, and your top
products are alcohol, face mask and face shield.
Due to COVID-19 pandemic, there is a high
demand of your products. What will you do since
items are going out of stocks?

9. This will also happen when there is less supply
and a greater demand, like a there is
insufficient fuel production of Saudi Arabia and
United States, there is also a fuel price hike in
different parts of the world. When the supply is
low, the demand is high and the price is high.

10. MARKET INTEGRATION
AND GLOBAL INTERSTATE
SYSTEM
Prepared by: Elsie Joy Licarte-Misoles, LPT
Lesson 1

11. Learning Objectives
At the end of the lesson, the students are expected to:
a. discuss the process of market integration;
b. inculcate the importance of market
integration;
c. explain the relationship of periphery, semi-
periphery & Core periphery; and
d. cite the role of global corporations in the
world market.

12. Market integration is a term used to identify a
phenomenon in which markets of goods and services that
are related to one another being to experience similar
patterns of increase or decrease in terms of the prices of
those products. Market integration occurs when prices
among different locations or related goods follow similar
patterns over a long period of time.

14. KEY POINTS

15. The world economy or global economy is the
economy of all humans of the world, considered as
the international exchange of goods and services
that is expressed in monetary units of account.

16. There are actors that Facilitate Economic Globalization
which are International Economic and Financial
Organizations, International Governmental
Organizations (IGOs), Media, Multilateral Development
Banks, Nation-States, Non-Governmental Organizations
(NGOs), Trans-National Corporations (TNCs), and
United Nations (UN) System.

17. Market integration occurs when prices among
different locations or related goods follow similar
patterns over a long period of time.

18. The division of labor consists of three zones according to
the prevalence of profitable industries or activities:
core, semi-periphery, and periphery.
Countries tend to fall into one or another of these
interdependent zones core countries, semi-periphery
countries and the periphery countries

19. Core countries are dominant capitalist countries that exploit peripheral
countries for labor and raw materials, while Semi-periphery countries
(sometimes referred to as just the semi-periphery. It plays a major role in
mediating economic, political, and social activities that link core and
peripheral
areas, and Periphery countries fall on the other end of the economic scale.
These countries lack a strong central government and may be controlled by
other states. These countries export raw materials to the core countries, and
they are dependent on core countries for capital and have underdeveloped
industry.

20. THANK YOU FOR LISTENING! 