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i also have a basic economics question
about globalisation and economical development.
Every economist will tell you that economies develop from being agricultural to industrial and then to service orientated. The first step is fine with me: You buy coffee from some african country and then sell some mashines or whatever to that african country, so that they can produce more coffee the next year. Both win.
I don't see how that is possible if the economy is more based on services. You can hardly export a hair cut to China, because some chinese guy sold you a dvd player. Yes, i know you can export some services, but as i see it, most you can not.
If this is true, I don't understand how such a situation can be stable on the long term. Let's assume you are a country and buy goods for 1,000 from China. you got your stuff, chinese guy gets 1,000. Now chinese guy has 3 options:
a) use the 1,000 to buy stuff or services from you or someone else who accepts (no problem)
b) sell the 1,000 to someone else who then has to pick between option a) or c)
c) invest the 1,000 in your country.
If you have no goods or services to export option c) is the only one possible, so let's say chinese guy does just that; he finds some investment that will make him 10% a year.
The next year you again buy stuff for 1,000 from the chinese guy, so that he now has 1,100 to invest (1,000 for the goods + 100 because of his investment). A year later it's 1,210 and so on until one day chinese guy tells you to **** off because he doesnt want your euros anymore.
How can this work out?
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im not tolerant, i just dont care.
Last edited by wu_trax; 11 Oct 2005 at 11:02.
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