Economics: Today and Tomorrow © 2008

Chapter 20: The Global Economy

Chapter Overviews

Section 1: Reasons for and Results of Global Integration
As telecommunications and travel speed news from one corner of the world to another, society is becoming increasingly global. Improved telecommunications have increased global integration. The chapter describes the kinds of financial investments now traded in global markets and explores some of the problems with links among worldwide stock markets.

Section 2: Direct Foreign Investment-Should We Be Worried?
Foreign investment has grown considerably in the past twenty years. Direct foreign investment in the United States continues to grow, and some Americans want to restrict it, because they think too much of America is owned by other countries. On the contrary, consumers usually care more about the quality and price of a company’s product than about the extent to which foreigners control that company.

Section 3: Multinationals and Economic Competition
Firms that do business and have offices or factories in many countries are known as multinationals. Due to this concept, globalization has occurred and increased the need for tolerance and open-mindedness.