МОЖНОСТИ И ОГРАНИЧУВАЊА ЗА НАЦИОНАЛНИТЕ ЕКОНОМСКИ ПОЛИТИКИ ВО МАЛИТЕ ОТВОРЕНИ ЗЕМЈИ
POSSIBILITIES AND CONSTRAINTS FOR NATIONAL ECONOMIC POLICIES IN SMALL COUNTRIES

Summary/Abstract: The increasing internationalization of economic activities presents the focal point of the contemporary world. Namely, under the impact of the "new" technologies factor mobility has substantialy increased which in turn has sped up the process of integration of national economies. All economies become increasingly open; only the world economy is truly closed. ln this environment, where prices of traded goods, financial assets, and interest rates have become interrelated and even uniform, the options for autonomous economic policies, especially by the small countries, have been greatly reduced. ln addition to the global changes there has been а dramatic turnabout on the economic paradigm; interventionism and expansion have been replaced by liberalism and austerity. lt has been proclaimed that the neutral policy is the best course to secure proper functioning of the market mechanism. Yet, economic realities are not аѕ perfect аѕ they look at first glance. Economic reality always means frictions, inperfections, lack of information, lags of reactions etc.. Therefore, in the narrow room between the strict theoretical principles and the real world imperfections, economic policy can still perform. Regarding all these relations, the small countries can take а free rider position and exercise it аѕ long аѕ the "big" countries do not drastically react. ln open macro-economies most often cited for this the "beggar my neighbor policy". Also, given increased internationalization some policy fields have to been reinforced internationally. Considering the high level cooperation and coordination in the field of monetary and exchange rate policies among the nations, small countries should transfer these policies on international level. Their domestic policies should stress structural and distributionary policies more. Nevertheless, economic policy is first and foremost politics. There are no single solutions and lasting concepts, but there is always а political choice.

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