International Economic Growth Essay Example | Topics and Well Written Essays - 1250 words

International Economic Growth - Essay Example The reduction in costs facilitated trade between countries and the shipment of goods to other countries became easier and cheap. It also leads to exchange of services, technology, factors of production and economically useful knowledge. The fall in transportation cost was also accompanied by an increase in the transportation speed. With the combination of fast, cheap and easy transportation, inter-trade between countries grew. Labor became mobile due to introduction of fast ways of travel and migrated to different countries to take advantage of better job opportunities. Moreover, due to increased communication and exchange of technology, a change in lifestyle also occurred in many countries. The use of new technology was adopted by many countries so the lifestyle of people living in these countries became similar also leading to a global economy. To sum up, migration, international specialization, trade and public policies helped create a global economy before the First World War. The First World War took place mainly in Europe between the years 1914 and 1918. The aftermath of the war saw a huge impact on the economies of the countries that fought, (Britain, Italy, U.S, France, Germany, Greece, Japan, Portugal, Turkey and Russia among others) and ultimately, affected the global economy by bringing the process of global economic integration to a halt or at least slowing the process down. 2. 'The First World War represents a turning-point in the economic history of Europe.' Discuss. The First World War is certainly a turning point in the economy history of Europe as it steered the economy in European countries away from moving towards a globally integrated economy. Firstly, it was because world international trade suffered a sharp decline after the war as the United States, Great Britain and France still had some conflicts. The European economy suffered a great financial setback in the war and faced many economic difficulties. Many industries that were opened to support the war had to be closed down and the countries saw a rise in the level of unemployment. The rise in protectionist policies proved to be a barrier to free trade and adversely affected the growth of many countries' economies. Capital movements between countries became restricted and relations between countries weakened further. Also, there was a decline in the level of production and transfer of resources to the production of military goods had to be stopped. To help the country survive in the war, many countries had taken loans which in no way was favorable for their declining economy at that time. As predicted, the economies of many countries had to face an economic crisis. Wealthy people lost their money and there was a sharp fall in the living standards of people. The GDP (Gross Domestic Product) of these countries subsequently fell. In 1918, Britain imposed the system of rationing. However, issues of rising prices, worker's disputes regarding pay and overtime and lack of proper housing arose. It gave way to many strikes and unrest prevailed in European countries. The First World War was indeed a turning point for the economy in Europe as it did not support the great economic growth of the pre-Great war, disrupted lives,