IS GEOGRAPHY IMPORTANT TO UNDERSTAND THE ECONOMY AND WHY?  1200W

Geography is important to understand the economy as it helps one understand different components to it. The following will discuss how geography has impacted the economy through trade, globalization and interdependency. However, this essay will also discuss the implications inevitably attached to trade and globalization, which for instance, leads to corruption.

One reason why geography is important to understand the economy is because of the emergence of trade blocs. For example, the ‘European Union (EU) has created a common European market’ (McCann, n.d.). Trade blocs, such as the EU have enhanced the exchange of services and commodities, by removing trade barriers such as tariffs, therefore encouraging trade among EU members. The creation of free trade created ‘’perfect and ubiquitous information flows between regions’’ (Martin 1999), which therefore enhances the role of the economy, by making countries more globalized and reliant on one another. Consequently, the economy has shifted to become a complex entity, whereby political agreements have enhanced trade and created a globalized economy. Trade blocs therefore make geography important to understand the economy as it shows that the economy has political dimensions which have enabled the economy to grow.