The concept and performance of open and closed economic system

Closed economy (net) - economics, which is not included in the international division of labor, does not export or import the goods and services that are not participating in the international movement of factors of production, stands outside of international financial relations.
It is an economic system in which all transactions are carried out within the country and estimates are made of the national currency. In closed economies, foreign economic relations of the country either do not exist or are strictly dosed, and foreign economic policy has a pronounced restrictive.
We can say that a closed economy - the economy, the development of which is determined solely by domestic developments and is not dependent on trends taking place in the world economy. Such economies are also called self-sufficiency. Autarky - economic isolation of the country from other countries, the creation of a closed economy samoudovletvoryaetsya in a separate state. In the pure form of self-sufficiency appeared only in a subsistence economy in the pre-capitalist formations.
In modern times, the country could be in autarky or because of external circumstances (the holding in respect of its economic blockade, economic sanctions), or by carrying out the state's policy of autarky (for example, in preparation for a war that involves the creation of all sorts of obstacles to development economic relations with other countries).
Thus Germany, striving to 1930. accumulate material resources in order to establish an economic base for waging aggressive war, officially declared the autarky of its economic policy. In view of the economic blockade after the October Revolution and the Civil War, the Soviet Union was in a position of forced self-sufficiency, focusing on self-main types of goods.
In these circumstances, the country's economic ties with other national economies were minimal, and all foreign trade transactions were carried out only through state-owned foreign trade organization. After the end of the "cold war", when autarchy was generated by the country's political isolation from the outside world after the collapse of the socialist camp closed type of economy actually outlived its usefulness.
The model of an open economy implies the freedom of economic activity both within the country and abroad. Open economy - the economy where all economic actors are free to make transactions in the international market of goods, services, capital and other factors of production. In contrast to the closed economy is seen freedom of foreign trade transactions, is set free exchange rate, and regulation occurs through the foreign exchange reserves and regulations.
The open economy means that countries are actively involved in MRI, export and import a significant share of the produced goods and services exports factors of production (labor, capital, technology) and are free to import them, and that the country is prepared to lend in world financial markets and included in the the system of international economic and financial relations. World experience shows that countries with closed economies eventually become poorer than those who participate in world economic relations, as the first isolated from new ideas and technologies from foreign investment, information, etc.
A specific feature of foreign policy in an open economy is maximizing the benefits of foreign trade to achieve the most efficient operation of the national economy. Open economy excludes the state monopoly on foreign trade, and requires the active use of various forms of joint ventures, the organization of free zones, and also implies a reasonable availability of the domestic market for the inflow of foreign capital, goods, technology, information and labor.
The degree of openness of the economy is largely dependent on the availability of natural resources, the population size, the capacity of the internal market and on the demand of the population. In addition, the degree of openness of the economy will be determined by the reproductive and branch structure of the national economy.
As practice shows, the more the structure of the industry share of basic industries (metallurgy, power), the smaller the relative involvement of the country in the international division of labor, the less the degree of openness of its economy. We can say that the degree of openness of the economy, the higher the more developed economic relations in it, the more its sectoral structure of industries with advanced technology division of labor, the less its own supply of natural resources.
According to the degree of openness of the economy can be divided into the following groups: those with respect to a buried economy (export share of less than 10% of GDP) of the country with a relatively open economy (export share of more than 35% of GDP) of the country, which are located between the first two. By this measure, the countries with the most open economies are Hong Kong, Singapore, New Zealand, Switzerland, with the least open - North Korea, Cuba.
However, the share of exports in GDP - is not the only indicator of the openness of the economic system. As the indicators used to measure the degree of openness of the economy, most often, the following groups of indicators.
1. The indicators characterizing the activity of the country in world trade:
• coefficient of intra international specialization:
Ranges from -100 to +100 (in the first case, the country is only importing a particular product, in the second - only exporting a particular product). Indicators, which are located between the extreme points characterize the degree of involvement of the country in intra international specialization;
• export quota - a measure of the importance of exports to the economy and individual industries for various types of products:
The increase in the export quota as evidenced by the growing participation in the international division of labor and the growth of the competitiveness of its products;
• describes the significance of the import quota for imports of the economy and individual industries for different types of products:
• foreign trade quota is defined as the ratio of the total value of exports and imports, divided in half, to the cost as a percentage of GDP:
• the structure of exports, ie, the ratio of densities or exported goods by type and degree of processing. Thus, a high proportion of products of processing industries in the country's exports, usually indicates a high sci-tech and manufacturing industry level, the products which are exported;
• the structure of imports, especially the ratio of the volume of imported raw materials and finished products. This figure is most clearly characterizes the economy's reliance on the foreign market and the level of development of branches of the national economy;
• comparative ratio of a country's share in world GDP (GNP) and its share in world trade: the higher the value of their performance, the greater the country involved in international economic relations.
2. Indicators of capital outflow (the international movement of capital):
• The volume of foreign investments (assets) of the country and its relationship to the national wealth of the country. Typically, a country with a high level of openness of the economy has a lot to invest in the economy of other countries;
• The ratio of the volume of direct foreign investments in this country abroad with the volume of direct foreign investments in its territory. This relationship is characterized by the development of international integration processes and is closely related to the efficiency of operations and the level of openness of national economies - the subjects of investment capital;
• The volume of external debt and its ratio to GDP (GDP) of the country.
The move towards openness is associated with the emergence of many complex problems, one of which is the issue of economic security, the determination of optimal conditions for interaction with the world economy. For the industrial development of the countries, especially without their own reserves of energy and raw materials, the openness of the economy is a significant factor in their further development.
All other countries are also involved in the international division of labor, and, consequently, to establish business relationship with each other, which leads to increased interconnections and interdependence of the subjects of the international division of labor and the emergence of the need to combine the benefits of specialization and cooperation with protection from negative external influences.
As a result, there is a risk of instability of the national economy, which is due to the fact that trade relations entered into by the country as a "discovery" can not be completely safe. Therefore, the development of foreign trade in individual countries can take place only relative economic security of the interdependencies.
Interdependence can lead to economic dependence, are those of cause and effect, in which the external factors have a significant influence on the development of a situation. Dependence arises when any solutions for problems require corresponding changes in the form

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