International Measures to Control Trade Cycle
International Measures to control trade cycle
Trade cycle is a global experience and no nation is hermetically preserved from the rest of the globe. The measures recommended to be implemented on an international level are: International Buffer Stocks, International Production Control, and International Investment Control.
International Production Control visualizes organization of production as well as prices of the significant principal goods. The complexity of such International Production Control are without a doubt alarming, especially for the reason that agriculture in nations such as Pakistan and India is more often than not approved on a undersized scale and rather as a means of living than for commercial benefits, so that even if it stops to be cost-effective, it will be continual. however International production control, as far as feasible, together with defense stocks to thwart unexpected adjusts in supply as well as demand will go a long way in checking increase or drop in their prices which give increase further to severe changes in the whole economy.
An international investment control for emergent backward areas would assist in elevating the living standards of their people and as a result decrease the disparity in the living standards of diverse peoples. Such cutback in these disparities is bound to support the forces of global stabilization.
These are some of the measures that can be adopted to alleviate suffering. But the world has not been able to discover any panacea or sovereign remedy for a trade cycle. Nothing short of reorganization of the economic system can provide against the recurrence of crises. These are the by-products of capitalism and so long as capitalistic system of production continues such disturbances must take place.
It may be added that not all fluctuations are necessarily harmful; some of them may be beneficial to economic growth. Stabilization policy should therefore be applied to counteract undesirable fluctuations. Besides, care must be taken that stabilization programme does not unduly discourage private investment. As per Keynes, the correct cure for the trade cycles is not be to the initiated by eliminating booms and as a result living us eternally in a semi-slump, but in eliminating slumps and therefore living in a state of permanent quasi-boom.