New Economy in the Era of Globalization and Its Importance PhDr New Economy in the Era of Globalization and Its Importance PhDr.Jana Gašparíková PhD. Žilina University, Faculty of Humanitarian Studies

New Economy versus Old Economy (Clasical) New economy is based on many new phenomenons To live in era of uninterruped changes New innovations and adaptation to new changes It increases social tensions and on the other hand growth of entrepreneurial activities

Entrepreneurship and New Incentives Triple Helix Different Type of Networking Clustering and Partnership The European Recovery Plan Creation of New Jobs

New technological changes New technological changes increase the productivity in one sector , and offer other sectors new instruments These changes ask for new way of thinking New economy brings new possibilities for entrepreneurship, new organization of work New economy will be more and more recognizable (as for instance social state after second world war)

New economy and 5 important phenomenons Technologies and competitiveness New economical culture in sphere of government, households and entrepreneurship

Other characteristics of new economy E-economy digital economy Globalization means new economy with certain uncertainty New Type of Governance

Model of new economy (Global Business Network) Market World – economy and business are interconnected, overcome frontiers of national states (sometimes it is difficult –other cultures) New Empires- dominance of policy and interests boost nes strong states to create new regional units Global incoherence- danger of this development

Old versus New Economy Classical economy: markets are stable competitiveness: national organization:hierarchical New economy: markets are dynamical competitiveness: global organization: networking

Classical economy and New economy Classical economy :production is mass production Determination of growth:capital and work Technology: mechanization Competitive advantage based on decrease of costs Relations among firms – not so important

New economy Organiztion of production:flexible production Determinants of growth: innovations, knowledge Technologies: Digitalization Competitive advantage : innovations, quality Relations among firms:alliances, cooperation

Classical economy Aims of employement policy: full employment Skills: specifications for determined position Education: diploma Character of employment:stabile

New economy Aims of employment policy: higher real wages Skills: cross-training Education:lifelong learning Character of employment: influenced by different risks and changes

Classical economy Position of government: Relations with entrepreneurs:sanctions Regulations:controll

New Economy For government: Relations with entrepreneurs:support of different occasions for growth Regulation based on market instruments, flexility

New Economy and its paradoxies Critics of new economy: Paul Krugman and Robert Solow More financial investments for new technologies and less returns in GDP Influence is visible only in certain sectors

New Economy and New Sectors The growth of acquisitions in different sectors : in farmaceutical industry, IT industry etc. New indicators of quality of life:human development index

New Economy and Macroeconomy and Microeconomy It is still problematic to see positives and continuous growth in the long perspective It is difficults to use innovations for large firms- it is more risky for them

Integration and Internationalization New type of interntionalization New type of combining different economies to one unity It starts to be important new international specialization and cooperation of production Increase of foreign capital in different companies Increase of daugher companies

International integration Integration countries to new unities EU APEC countries- Asian countries MERCOSUR countries (Argentina, Brasil, Urugay,Paraguay and Chile) NAFTA countries- North American Free Trade Agreement (USA, Canada, Mexico)

Transnational Firms The biggest trnsnational firms Different sectors

The Role of Scientific –Technological Progress There are tendencies to differentiate scientific progress in scientific and business capital Increase of business in different transnational corporations and gains

Transnational corporations Their activity is very often multidimensional They invest lot of money in R and D Their turnover is around 1 billion US dollars