Capitalism & Freedom Ideology

Started withMilton Friedman &

The Chicago School of EconomicsThe most influential schools of thought in

20th Century Economics Development

Key principleFree markets are the institutional

guarantor of choice, opportunity, and limits on government control over

people’s lives.

Free Market Economies lead to societies that have the freedom to choose

BUT has resulted inGreed & Power, Great divide between haves and have-nots

The Shock Doctrine (Naomi Klien) (Trailer 1.46 m)http://www.youtube.com/watch?v=OPqBVSiBdxE

Tutorial Overheads Location

http://monashtutorials.wordpress.com/

Economic Development aiming for Open & Free Societies

Amartya Sen (Harvard Uni)• welfare economics, • social choice theory, • economic and social justice, • economic theories of famines, and • indexes of the measure of well-

being of citizens of developing countries.

Long-term development flourishes in open societies, where governments allow their citizens the right to inquire into anything, speak freely and stand up for their rights. Without openness and liberal values, long-term prosperity is doomed.

The End of Poverty? Trailer (3 min)https://www.youtube.com/watch?v=PWEbu6Iyn0c

In today’s Globalised world, we need to look at a different model of economic growth

Development Approaches

1. Natural endowments

2. Innovation & entrepreneurship

3. Education

4. Infrastructure

Some of World Bank’s Development Approaches

• Governance & Anti-corruption• Governance & Public Sector

Reforms• Poverty Reduction• Community driven

development• Mainstreaming Gender• Empowering the poor• Participation & Civic

Engagement(World Bank, 2011)

Questions & Discussions1. Amartya Sen argues that a country’s development should be broaden to include just more

than economic development. What other factors does Sen think should be included in an assessment of development? How might adoption of Sen’s views influence government policy? Do you think Sen is correct that development is about more than economic development? Explain

2. What is the relationship between corruption in a country and economic growth? Is corruption always bad?

3. What is a country’s legal system? Why is it important to international business? Compare and contrast the 3 main types of legal systems in use around the world. What implications do each of these raise for international business?

4. Japan Case:a) In the 1980s Japan was one of the world’s most dynamic economies. Today it is

viewed as one of its most stagnant. Why has the Japanese economy stagnated?b) What lessons does the history of Japan over the last 30 years hold for other nations?

What can countries do to avoid the kind of deflationary spiral that has gripped Japan.c) What do you think would be required to get the Japanese economy moving again?d) What are the implications of Japan’s economic stagnation for the benefits, costs and

risks of doing business in this nation?e) As an international business, what economy would you rather invest in, that of Japan

or that of India. Explain.

Questions & Discussions

1. Amartya Sen argues that a country’s development should be broaden to include just more than economic development. What other factors does Sen think should be included in an assessment of development? How might adoption of Sen’s views influence government policy? Do you think Sen is correct that development is about more than economic development? Explain

2. What is the relationship between corruption in a country and economic growth? Is corruption always bad?

3. What is a country’s legal system? Why is it important to international business? Compare and contrast the 3 main types of legal systems in use around the world. What implications do each of these raise for international business?

Questions & Discussions4. Japan Case:

a) In the 1980s Japan was one of the world’s most dynamic economies. Today it is viewed as one of its most stagnant. Why has the Japanese economy stagnated?

b) What lessons does the history of Japan over the last 30 years hold for other nations? What can countries do to avoid the kind of deflationary spiral that has gripped Japan.

c) What do you think would be required to get the Japanese economy moving again?

d) What are the implications of Japan’s economic stagnation for the benefits, costs and risks of doing business in this nation?

e) As an international business, what economy would you rather invest in, that of Japan or that of India. Explain.