Economics

Fundamentals

AIMUN 2010 - Economics'

Fundamentals

Agenda
Review of Money Supply.
International Financial
Institutions.
Communism Vs Capitalism.

AIMUN 2010 - Economics'

Fundamentals

Review of Money Supply

AIMUN 2010 - Economics'

Fundamentals

International Financial Institutions

AIMUN 2010 - Economics'

Fundamentals

Financial Institutions

I. International Financial Institutions:

-

International Monetary Fund;

World Bank (IBRD, IDA, IFC, IMGA);
EBRD;
European Investment Bank;
Bank for International Settlements;

II. Government Institutions:

Public
Financial
Institutions

- Export Credit Agencies;

- Export Guarantee Credit Agencies;
- Export Insurance Agencies;

III. Depository Institutions:

-

Commercial Banks;
Savings and Loans Associations;
Mutual Savings Banks;
Credit Unions.

IV. Non depository Institutions:

-

Investment Banks;
Mutual Funds;
Pension Funds;
Insurance Companies;
Financing Companies;
Venture Capital;
AIMUN 2010 - Economics'
Stock Markets Brokers and Dealers.
Fundamentals

Private
Financial
Institutions

Types of IFIs

Bretton Woods institutions

Regional development banks
Bilateral development banks
Other regional financial institutions

AIMUN 2010 - Economics'

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Bretton Woods
institutions
The best-known IFIs were established after World
War II to assist in the reconstruction of Europe
and provide mechanisms for international
cooperation in managing the global financial
system. They include the World Bank, the IMF ,
the International Finance Corporation, and other
members of the World Bank Group.

AIMUN 2010 - Economics'

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International Monetary Fund IMF

IMF is a forum of national economic policies,
international monetary and financial systems,
Which involves active dialogue with each member
Country.

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Functions of IMF
Surveillance (like a doctor)
Gathering data and assessing economic policies of
countries.
Technical Assistance (like a teacher)
Strengthening human skills and institutional
capacity of countries.
Financial Assistance (like a banker)
Lending to countries to support reforms
AIMUN 2010 - Economics'
Fundamentals

The World Bank

World Bank is a term used to
describe an international financial
institution that provides leveraged
loans to developing countries for
capital programs. The World Bank
has a stated goal of
reducing poverty.

AIMUN 2010 - Economics'

Fundamentals

International Monetary Fund

World Bank

Oversees the monetary system of the

world.

Promotes economic development in

underdeveloped countries.

Promotes exchange relations and

Helps underdeveloped countries by
stability among its member countries. providing long-term financing for
development projects.
Adds to the currency reserves of its
member countries through allocation
of special drawing rights (SDRs).

Encourages private enterprises in

developing countries through
International Finance Corporation
(IFC), which is a sub-part of the IMF.

Assists all its member countries that

are in temporary balance of
payments difficulties by providing
them short- to medium-term credits.

Provides special finances to poor

countries that have a per capita
Gross National Product (GNP) less
than $865 a year.

Financial resources come from the

fixed quota subscriptions of its
member countries.

Financial resources are acquired by

borrowing on the international bond
market.

Has about fully paid-in quotas totaling Has authorized capital of $184 billion,
$215 billion.
of which members pay in 10 percent.
Has a total staff of 2,300 from 185
countries.

has a staff of 7,000 from 185

countries

AIMUN 2010 - Economics'

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Communism Vs Capitalism

AIMUN 2010 - Economics'

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What is Communism?

AIMUN 2010 - Economics'

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 This is the symbol

of Communism
The Hammer and
the Sickle
Hammer for
the
Workers
Sickle for the
Peasants the
farm labourers

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Who are these

characters?

What is Communism?
Those Blokes wrote the Communist
Manifesto
in 1847. Its a short book but billions of
people have read it.

This is Karl Marx, the Father

of Communism. People who
believe in his ideas are
called Marxists
AIMUN 2010 - Economics'
Fundamentals

This is his good friend,

Frederick Engels.

Marx and Engels studied the history of the worlds

economies.
This means the way that power, industry and finance are
controlled.
Communism
They saw the way countries developed in stages.
Socialism

Capitalism
Feudalism
Primitive
Communism

AIMUN 2010 - Economics'

Fundamentals

Primitive
Communism

This is how humans first lived together in

small tribes. Primitive means not very
advanced e.g. hunting and gathering.
Communism means that everything was shared
amongst the tribe food, jobs, belongings. Noone owned land. Eventually a group comes to
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power
this- Economics'
leads to Feudalism
Fundamentals

Under feudalism, a
king or emperor or
chief becomes the
ruler over all the
people.

Primitive
Communism

The people
are kept
uneducated
and told
Feudalism
that god
chose the
king to rule.
The church
helps the
AIMUN 2010 - Economics'
king this
Fundamentals

He gives land
and privileges
to nobles
who rule the
people for
him.

As trade develops,
some people get
richer. This leads
to Capitalism..

The business
owners or
capitalists get
richer while
the workers
do all the hard
work.

The
capitalists
get more
power to
serve
their own
interests.

Capitalism

Capitalism creates a huge

working-class of people who soon
get angry at the way they are
treated. They organise in unions
and demand changes. This will
AIMUN 2010 - Economics'
lead to a revolution and
Fundamentals
Socialism

Feudalism

The workers
take control of
the country to
produce
things for
everyone.

Capitalism

In the Socialist
revolution all the rulers
kings, churches,
capitalists are got rid
of.
AIMUN 2010 - Economics'
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Because nothing is
made for profit, all
people benefit from
education and
health.
Socialism
These ideas
spread
across the
world to
create
Communism
.

The remaining
capitalists put up a
bitter fight, but the will
of the people will
always win.

Communism

Socialism

As everyone now works

together, war is a thing of the
past armies are not needed.
Sharing means no police are
needed. Everything is provided
AIMUN 2010 - Economics'
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by the people so money

All human activity

goes towards
benefiting each
other allowing all
to live their lives
to the full.

Modern Communism
Public (government) ownership of the
means of production
From each according to his ability, to
each according to his need.
Workers run the factories everyone earns
an equal amount
Lots of government intervention in the
economy to promote equality
Good of society is above the individual
AIMUN 2010 - Economics'
Fundamentals

What is Capitalism?
Capitalism,economicsysteminwhich
private individuals and business firms
carry on the production and exchange of
goods and services through a complex
network of prices and markets.

AIMUN 2010 - Economics'

Fundamentals

The Principles of Capitalism

Private ownership of property
No legal limit on the accumulation of
Property
Free Market No government Intervention
in the economy
The Profit motive

AIMUN 2010 - Economics'

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What is The Role of the

Government?

AIMUN 2010 - Economics'

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Critics of Capitalism

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Result of Capitalism

AIMUN 2010 - Economics'

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A Classification of Economic
Systems
U.S., Canada,
China,
W Europe,
Russia
Japan
Pure
Pure
capitalis
socialis
m
m
Mexico
France,
Cuba,
Hong Kong
Sweden , Latin
N.
, Israel Americ
Korea
a

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Thank You

AIMUN 2010 - Economics'

Fundamentals