Question

1. Why is it said that the global economy is fundamentally anarchic? Discuss some

of the formal and informal regimes that have arisen to cope with this anarchy

and the roles these regimes perform.

Answer 1

The global economy is fundamentally anarchic because till now in this advanced 21st century we are having loose holes in global tax polices and transparencies among them which provide leverage to elites for tax saving without breaking the laws. In brief till now we don't cherish the transparency in flow of resources(money).

Formal Regimes:

Like the US government, it is formal legal made by law and act in the judicial boundaries but it has a limited enforcement power. Sometimes it act as a global cop but that also for the selective purpose only. These formal regimes has major role to establish comprehensive tax system to increase the transparency of flow of money from one country to another.

Informal Regimes:

IFF or Illicit Financial Flows as they are usually known) includes the Global Forum for Transparency and Exchange of Information for Tax Purposes (OECD), the Multilateral Convention on Mutual Cooperation in Tax Matters (OECD), the Extractive Industries Transparency Initiative (EITI) is the example for informal regimes Their jobs is to build global tax systems which removes the problems like panama and luxembourge.

Conclusion:

The global economy is fundamentally anarchic because of lacking of some polices which provide the advantage to the big fish in the pond but regimes come in front to take responsibilities to improve the system so those advantages which are previously not in the law and enjoyed by these big fish now made them illegal to catch those who were taken advantage of it previously.

Assumption :

The above answer is a brief of the question it is not includes any details and just to provide a crux of knowledge.