ISAS Working Papers

Two developments, the first decades old and the second very recent, have reshaped and are re-shaping the global economic landscape. The first was the process of globalisation that reduced the distance among different economies in the world, not in the physical sense, but in the sense of easy flow of capital, trade, information and technology. Globalisation has produced a global economy the like of which the world has never known, and the process will continue to move forward the global economy.3 1 This is a revised version of an earlier draft which was discussed at an ISAS seminar, “Asia in the Catch-Up Game” held on 9 March 2010. Several helpful comments and suggestions made by participants at the seminar have been incorporated in this version. The future course of the world economy is one of the main issues addressed in the study. The second development was what economists and financial experts call the Great Recession of 2007-09 to distinguish it from the Great Depression that took such a heavy toll in the 1930s. What was ‘great’ about this particular downturn in economic activity was that its origins were not in the normal working of the large economies that produce trade