The global economy has been unequal for almost the past two centuries. The inequality has consequently led to the evident enlarging economic gaps between nations, though not particularly within nations (Tobin, 1998). Ridiculously, it is in this same period that some leading economists have been claiming that the world economy has been more integrated globally. This has made some economists develop the feeling that there is a relationship between economic inequality and global economic integration. Heightened globalization mitigates the effects of unequal treatment between nations particularly during their participation in the global market. Normally, countries that make more gains in the global markets are those that modify their policies in order to exploit it (National Bureau of Economic Research, 2012). Though the world economy has globalized and the dominant nations like Europe and the United states made a lot of progress to become the global financial giants, the globalization process should be made more intensive in order to become beneficial even to the third world nations in Africa and Latin America.
Since technological advances is one of the major contributors to economic growth, the leading world economies should assist third world nations to develop their technological infrastructure in order to heighten their participation in e-Commerce (Intriligator, 2003). This follows the notion that technological advances reduce communication and transportation cost of not only data processing, but also storage of information. It is evident that though computer evolutions have been taking place in the developed nations with the number of internet users rising day by day, third world countries are still lagging behind. Trade liberalization is the other force that contributes to a stable economy. This is because it enables business transactions between nations with least restrictions. The EU single market and the North America Free Trade Association (NAFTA) are the renowned forms of trade that allow free trade between nations involved. Such organizations should also include the developing countries in order to boost their economies.
The other driver of globalization is changes that take place in institutions. Organizations are able to have a broader reach to developments in the communication sector. Bearing this in mind, organizations that focus on the local market should become national, multinational and global. Such changes will undoubtedly lead to increase in power; profits and productivity in the respective firms enable them adjust appropriately to the changing market conditions. This can only be possible if the nations have a higher variety of markets to choose from. Non-governmental organizations (NGOs) such as the United Nations (UN), World Trade Organization (WTO), International Monetary Fund (IMF) and World Bank should increase their involvement in the developing nations (Intriligator, 2003). Although these NGOs have been involved in the development of third world nations, their influence should yet be made more aggressive in order to hasten their economic growth.
Another factor that is likely to heighten globalization is the international concurrence on ideology, with a constant convergence of beliefs on the importance of a market economy in addition to a free trading system. This is not a new ideology as it started with economic and political changes in reforms that were carried out in China in 1978, followed by “falling dominoes” sequences and the closure of the Soviet Union in 1991 (Intriligator, 2003). The process consequently contributed to convergence of ideology and nations started working hard towards the growth of a global economy. This resulted in a market that was no longer partitioned by socialist and market-oriented economies.
There should be further developments made in order to improve the market conditions of third world nations and allow them have equal powers with the other leading global economies. Exploitation of the natural resources is undoubtedly the other prickly issue that should be handled with a lot of concern. Oil and petroleum products as well as the natural gas are the most basic natural resources that any nation requires for development. It is, however, so unfortunate that such resources are unevenly distributed with some nations such as the United States, taking the highest percentage, followed by the European nations, when the rest take the least share.