The process of globalization anticipated the superior role of economy over the policy in governance. However, after a number of acts of terrorism, societies started to think about security and its guarantee. The threat of terrorism reminded that world economy cannot exist separately from the policy. It is true, because there is no security without State and public services; there is no law without State, and there is no security without law. As a result, there cannot exist any guarantee either of the national or world dimension, and any possibility of solving legal conflicts. Hence, the logical question emerges: ‘Should the policy be reconsidered as a superior power today, when risks of globalization become evident?’ According to Ulrich Bek, what nations need is an expansion of policy, which has a potential to regulate crises and conflicts.
Consequently, the principle of State necessity became very popular as a way to provide national security. Today, world economy should be accommodated to new rules and principles of functioning. Terrorism tried to oppose the process of globalization. However, opposition to globalization just enforced it and led to the unexpected new era of political and economic globalization and countries’ cooperation. So the process of integration is inevitable and ambivalent. Small and weak countries require the access to the world markets. Before the visit of the Germany’s Chancellor one could read in the Ukrainian newspaper: ‘We are ready to excuse conquerors and are waiting for investment’, because the lack of investment is even worse than being conquered by foreigners.
Economic globalization goes hand in hand with political cosmopolitism. However, in order to account for an individuality the risk of globalization it should be predictable. That will allow fair allocation of its goods and freedoms. The main risk is that the transnational state will be created, where the market freedom will be sacrificed in favour of private safety. It is needed then that large industrial groups, international economic regulation institutions, nongovernmental organizations and the U. N. O. should work together on the formation of institutions opened to the whole world and acknowledging religious and national differences, human rights and economic globalization.
References: 1. Feenstra Robert C. Integration of Trade and Disintegration of Production in the — Global Economy // The Journal of Economic Perspectives. — Volume 12. — Issue 4. — 1998. — Autumn. — P. 31 – 50. 2. Stiglitz Joseph. Globalization and its Discontents, 2001. 3. Bek Ulrich. What is Globalization, 1997.
OPTIMAL FOREIGN TRADE POLICY UNDER INTERNATIONAL OLIGOPOLY: THE CASE OF UKRAINIAN AUTOMOBILE MARKET
For the period of special investigation from July 30, 2002 a special import tariff was introduced for Russian passenger cars with the engine volume from 1 to 1,5 litres. As a result of tariff imposition, sales of Russian cars dropped sharply from 56% to 36%. Following the termination of special investigation, import of Russian passenger cars was subjected to the quota of 15 777 cars per annum . According to the conventional economic theory, the resulting decrease in the quantity of imported cars could have harmed not only Russian car manufacturers, but also Ukrainian consumers of the cars subjected to trade restriction. In fact, many of the would-be buyers of Russian cars (mostly VAZ) had to postpone their purchase till December 2002 when the tariff was cancelled. However, the association of Ukrainian car manufacturers insists on the imposition of a new permanent import tariff for Russian cars to protect domestic production. Therefore, it is of paramount importance to provide a sound theoretical and empirical justification for the claims of both parties and resolve the dispute on the basis of maximizing social welfare of Ukraine. In the following discussion I’ll consider only the market for low-price vehicles that is relevant for Ukrainian producers.
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