Download or read book The Impact of Globalization on National Accounts written by and published by . This book was released on 2011 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Globalization, as now understood, is a centuries old phenomenon of growing interaction between national economies. In recent decades, the phenomenon has gained a new momentum, because of political developments and progress in information and communication technology. The traditional interrelations, e.g. in closely connected financial markets, have grown considerably. At the same time there has been a deepening of globalization through, for example, international value added chains. Increasingly production processes extend over the whole world. These developments have had a positive impact on worldwide income and productivity. However, the financial crisis, which started in the USA in 2007 and rapidly spread to other parts of the world, has revealed the major risks associated with the growing interconnectedness of national economies. When looking at globalization from a statistical perspective, one is confronted with a number of challenges, which can be grouped into four broad categories: · The measurement of the phenomenon itself. How can we measure (the further development of) globalization? Which indicators capture the growing interdependence of national economies? · The description of the behaviour of multinational enterprises (MNEs), which are the driving force behind globalization. How do MNEs behave, and why? What are the reasons behind the division of activities and the subsequent allocation of these activities to countries? What are the comparative advantages of national economies? · The impact of globalization on traditional indicators. Globalization can have a significant impact on all aspects of a society's development, economic, social and environmental. More (detailed) information to support further analysis and research is particularly important in the areas of significant impact. · The impact of globalization on the compilation of traditional indicators. The increasing proportion of enterprises running their business on an international scale and the growing cross-border movement of people, financial capital, goods and services pose specific problems to compilers of national statistics. In April 2007, a UNECE-led Expert Group on the Impact of Globalization on National Accounts (GGNA) was established, following a decision of the Conference of European Statisticians (CES). The Group was organized jointly with the OECD and Eurostat. A framework of indicators for measuring the magnitude and pace of economic globalization had already been agreed, as a result of the work of a number of international organizations. However, little was known about its impact on the compilation of existing national statistics. There was a need to examine how globalization affects the compilation of economic statistics in general and national accounts in particular, and to outline the areas where further efforts are needed in order to maintain the quality of the data. Under its terms of reference, the objective of the GGNA was "to review the main distortions in the compilation of national accounts and related source statistics, as caused by globalization". In doing so, the Group should "put forward proposals on how to deal with these distortions in order to improve the quality of national accounts". The GGNA held three meetings, in April 2008, May 2009 and April 2010, to address the tasks mandated by the CES. It agreed on a list of globalization aspects with an impact on the compilation of national accounts, and commissioned and reviewed chapters describing each of them. This Guide "The Impact of Globalization on National Accounts" is the outcome of the work of the GGNA. It focuses on the main aspects of globalization and recommends solutions and best practices aimed at improving the design, processing and use of the data and achieving better international consistency in the identified problem areas. Clearcut solutions to meet the evolving challenge of globalization could not always be found. Proposals for future research are accordingly summarized in Chapter 14.