Adaptability of the economy to external and internal shocks in globalization

Abstract

The purpose of the study is to consider issues of adaptability of economic systems under the influence of external and internal shocks to the modern global challenges. The paper represents the theoretical foundations of determining the quality of factors external to economic systems capable of exerting a shock effect on them; the functions of the shock impact mechanism on national economic systems in the conditions of globalization processes are highlighted. Globalization is based on the development of global markets for goods, services, labor and capital. This process is characterized by the strengthening of the funds movement in the most profitable sectors of the national economy, the rapid development of financial markets that generate strong financial flows, and the sharpening of the financial market of innovations and the innovation process involves the creation, development and spread of innovations. Adaptation is considered as a process of changes in quantitative and qualitative features of the system, which allows to reach the optimal or, in critical conditions, the limit state of functioning in changing conditions. Systems are able to change their parameters in accordance with external conditions, self-adjusting is called adaptive, and the functioning of adaptive systems is based on a feedback mechanism. Adaptability implies the possibility of prompt response in the process of functioning of the system to the current information that is received, regarding changes in the conditions of its functioning. The essence of the concept of adaptability is to change the parameters, structure and algorithms of system functioning based not only on a priori information, but also current information, as well as forecasted information, in order to achieve or maintain a certain efficiency of the system when the operating conditions of the latter change. The content of external and internal shocks and their transmission to national economic systems, the spread of financial crises, were studied. External shocks in the context of globalization are the most obvious and significant manifestation of the influence of exogenous factors on national economic systems. The systemic role of external shocks lies in the fact that they are one of the components of the mechanism of spreading global financial instability. Considering shock disturbances as supply and demand, we also distinguish the main external sources of their occurrence according to the subjects of supply and demand. Keywords: adaptability of the economy, globalization, economic shocks, stability of the national economy, shock effects.