GLOBAL FINANCE

``All models are wrong but some are useful.''

George Box

This chapter contains a basic guide to some of the key Websites
and books to consult when beginning to get to grips with the global
economy.

Macroeconomic issues are easier to understand in hindsight; the

problem with topical coverage is that it tends to address unanswerable
questions about the future. For this reason, most of the books discussed
in detail here were written some time ago. Nevertheless, most of them
are classics and provide a valuable perspective on current debates.
With issues that are complex and difficult to understand, novelty is not
always a virtue appreciating how we got here is an important part of
judging where we are likely to go next.

BIG BUSINESS IN THE ECONOMY

The Visible Hand: The Managerial Revolution in
American Business

This Pulitzer Prize winning book by Alfred D. Chandler Jr. analyzes
how large corporations developed to their current importance. He
argues that recognizably modern businesses developed when admin-
istrative co-ordination began to be more effective than market mech-
anisms in enhancing productivity and lowering costs, giving rise to
a management hierarchy. Management hierarchies came to be self-
perpetuating, expansionist, and increasingly professionalized. As a
separation between management and ownership developed, manage-
ment professionals tended to focus on long-term stability and growth
rather than short-term gains, and corporations grew larger, reaching
their position of whole branches of today's economy. Written in 1977,
this book provides a good background to today's issues regarding the
globalization of business.

» Chandler, A.D. Jr. (1977) The Visible Hand: The Managerial Revo-

lution in American Business

. Harvard Belknap, Cambridge, MA.

The Myth of the Global Corporation

This 1999 book argues against the common view that multinationals
are more influential in the global economy than governments, and that