The global economic relationship remains essential in determining how individuals engage with one another in business. The relationship is complex, and individuals are required to engage in a manner which ensures that people benefit without unnecessarily getting involved in practices which require analysis and explanation (Steiber, 1979, p.24). The World System Theory developed by Immanuel Wallerstein seeks to present the global economy as a simple aspect that individuals can discuss without considering the different principles and characteristics (Chirot & Hall, 1982, p.82). We will discuss the role of World System Theory and the criticisms it faces in understanding the different dimensions of the global economy and its role in determining economic relationships.
One of the main criticisms of the World Systems Theory is that it does not factor in the different complex factors which dictate the global economy (Luhmann, 1997, p.68). Different countries and nations have different factors which determine the economic practices in such countries. There exist different economic practices and beliefs, which include socialism and capitalism. The two have their benefits and disadvantages, which dictate the benefits and losses one will likely get from the interactions (Robertson, 1996, p.396). However, the World Systems Theory does not consider these differences and oversimplifies the practices to ensure that the differences are not well captured. The theory assumes that all countries and economies are captured in one capitalistic economy, which is not the case because different countries embrace different economic practices. It is erroneous to assume that people in one country can adopt a common economic policy (Sklair, 1999, p.143). With the differences come different ideas, and some individuals can embrace one economic model while their colleagues go for another one. Therefore, the critics of the World System Theory can be justified in disputing the fact that individuals in a common environment must embrace one economic model.
In addition, the World System Theory fails to appreciate different factors in determining the society’s economic model. Different practices and social characteristics determine the economic model adopted by individuals. An example is when people’s culture, history and political structure influence an individual’s economic structure (Sorinel, 2010, p.221). While people need to look at the different global factors in determining the economic structure of a society, individual’s local factors tell how one carries out their activities. Politics and local culture are essential because they determine people’s activities. Again, local factors are vital in establishing a government or society’s policies toward enhancing its economy. While engaging the global economy in realizing growth and development is essential, countries’ economic policies and strategies play a significant role in ensuring economic progress is realized (Pieterse, 1988, p.252). Culture is vital in determining global economic targets and objectives because it dictates individual interactions, especially because the global economy is a comprehensive accumulation of different practices found in different societies. Individuals need to look at the different local factors which ensure that they can play a role in the global economy.
The various aspects of the global economy are critical in establishing the existing differences. However, the World System Theory is essential in breaking down existing relationships. Although people need to hold on to the principles that have been used since immemorial, striving to develop new mechanisms and strategies to overcome the challenges that appear in society today is critical (Feinman, 1999). Political power determines the economic policies to be practised in a country, and the global aspect is affected by the different policies formulated by different nations. Different nations can create policies which promote their selfish interests, like over-taxation of imports which affects global trade and leads to strategies to counter such strategies. History plays a significant role in determining the economic policy held by nations. Often, countries are likely to uphold the practices of their predecessors, and this makes it difficult for the individuals who initiate changes necessitated by the latest advancements (Robertson & Lechner, 1985, p.104). The World System Theory focuses on the core-periphery divide, which singles out the differences that exist in the global economy. Wealth distribution is affected by numerous factors which cause divisions in society, and it is vital for people to develop measures which ensure that long-standing social differences are overcome. There is a need for societies and communities to ensure an even distribution of wealth across different regions (Lechner, 2003, p.171). This way, the differences and inequalities which have stood for an extended period are overcome, and people are likely to live harmoniously.
In conclusion, the World System Theory plays a vital role in helping people understand the differences and dynamics involved in the global economy. Some individuals criticize the theory for oversimplifying the factors that affect the global economy. The global economy is complex and dynamic, requiring individuals to be analytical to understand its operations. Different individuals are involved in studying and analyzing the global economy, and we must understand that every person has a role to play in promoting the debate about global economic relationships. There are numerous factors which affect global economic relationships, and these must be considered in the analysis. Culture, politics and history must be looked into by individuals who want to understand global economic relationships. We note that failure to recognize the submitted local factors is the greatest flaw of the World System Theory because it ensures that individuals fail to have a better view of the dynamics involved.
References
Chirot, D., & Hall, T. D. (1982). World-system theory. Annual Review of Sociology, 8(1), 81-106.
Feinman, G. M. (1999). World-systems theory in practice: leadership, production, and exchange. Rowman & Littlefield.
Lechner, F. J. (2003). Cultural Aspects of the World System. Globalization: Culture and identity, 4, 171.
Luhmann, N. (1997). Globalization or world society: how to conceive of modern society? International Review of Sociology, 7(1), 67-79.
Pieterse, J. N. (1988). A critique of world system theory. International Sociology, 3(3), 251-266.
Robertson, R. (1992). Globality, global culture, and images of world order. Social change and modernity, 395-411.
Robertson, R., & Lechner, F. (1985). Modernization, globalization and the problem of culture in world-systems theory. Theory, culture & society, 2(3), 103-117.
Sklair, L. (1999). Competing conceptions of globalization. Journal of World-Systems Research, 142-163.
Sorinel, C. (2010). Immanuel Wallerstein’s world system theory. Annals of Faculty of Economics, 1(2), 220-224.
Steiber, S. R. (1979). The world system and world trade: An empirical exploration of conceptual conflicts. The Sociological Quarterly, 20(1), 23-36.
write