Global Market Economy

Definition

A global market economy is an economic system in which goods and services are traded freely across international borders, driven by supply and demand.

Analogy

Think of the global market economy as a giant worldwide supermarket. Just like how you can buy fruits from different countries in your local supermarket, businesses can trade goods and services with other countries in this "worldwide supermarket."

Related terms

International Trade: This refers to the exchange of goods and services between countries. It's like swapping lunch items with friends at school but on a much larger scale.

Free Trade: This is when governments do not restrict imports or exports. Imagine if your parents let you trade any of your toys without restrictions - that's free trade!

Protectionism: This is when governments impose regulations to protect their domestic industries from foreign competition. It's like if your parents only allowed you to trade certain toys to ensure you keep the best ones for yourself.