Globalization and Shifting Economic Centers of Gravity

T he world’s economic sphere has experienced significant changes in the past 40 years. The economies of the formerly socialist countries in central and eastern Europe, including Russia, underwent significant market reforms such as deregulation, privatization, and reinstatement of property rights toward establishing functioning market economies. Changes in the political economy of several countries in Latin America moved them away from decades of populist economic policies. The Southeast Asian countries opened up and followed aggressive exporting promoting economic policies. China, while remaining as politically a communist country, carried out similar market reforms, albeit not as swiftly as central and eastern Europe. As a result, these countries quickly integrated themselves in the new world economic system, taking advantage of globalization of the production and the markets and experienced significant economic growth. All these changes in economic systems in several corners of the world changed the economic balance of the world. While continuing to grow, the Changes in the political economy of countries in several parts of the world changed its economic