202410221431 Status: #idea Tags: #economics #politics #british_empire #globalization #history #institutions # Empires encourage capital flows to the developing world Developing countries in many cases have much higher chances of political and economic instability than rich, developed countries. This causes a cycle where developing countries need foreign investment to improve (eg to build roads, railroads, internet infrastructure, etc), but can’t access that foreign investment *until* they improve. This forces countries to look for debt from institutions like the IMF rather than rely on multinational corporations developing their country, which in many cases crippled the country with debt that payments. By contrast, when England and France ruled much of the world in the 1800s and early 1900s, the proportion of capital flows to developing areas of the world was significantly higher than today. This is because they were able to enforce top-down political stability and guarantee basic economic rights, such a property rights. This made investment into these areas much less risky, and so it could be relied upon for corporations to develop less-developed parts of the world. [[Global trade may not have been possible without the British Empire]] [[The British Empire liberalized many cultures]] --- # References [[Empire_ the rise and demise of the British world order and the lessons for global power]]