Navigating the Complex Landscape of Global Economics: The Role of Political Decisions and Institutional Frameworks

Abstract

This paper investigates the significant role of political decisions and institutional frameworks in shaping global economic dynamics. It critically assesses the interconnections between political stability, regulatory policies, and economic growth, emphasizing how these elements influence investment decisions and market efficiency. By exploring the ramifications of trade agreements and protectionism, the study illustrates their profound impact on international trade and domestic economies. It analyzes how stable political environments contribute to robust economic policies, while political unrest can lead to economic downturns. The paper further examines the role of institutional frameworks in enforcing or undermining economic stability, where strong institutions foster economic growth and weak ones may cause volatility and inefficiency. Drawing on empirical evidence and theoretical models, this comprehensive analysis underscores the delicate balance required in policy-making to enhance economic stability and growth in an interconnected global economy. This study aims to provide policymakers and scholars with deeper insights into how political and institutional mechanisms interact to shape economic landscapes, thus aiding in the formulation of strategies that promote sustainable economic development.