Essentially, the economic problem stems from the fact that as humans, we have unlimited wants and needs. A need is something that can be seen as being essential to survival, such as food, water, shelter and warmth. A want is something that we would like to have but which is not essential to survival - a car, the latest version of the PlayStation, all the latest gadgets on etc.

The problem is that the world and every individual in it have limited resources in relation to the wants and needs we have. We never have enough money to get what we 'want'. There are never enough resources to make sure the health service works properly.  In recent times, we have heard much about the problems faced by the armed forces in conflict zones around the world 'not having the tools to get the job done'.

TheThree basic economic questions- these are the questions all nations must ask when dealing with scarcity and effcientlly allocating their resources.

• What to produce?
• How to produce?
• For whom to produce?

The essence of a MNC is that they bring inward investment to countries that are not their home base. If they choose to expand by building production facilities they will be bringing in inward investment into the country. This investment is likely to provide a boost, not only to the local economy but also the national economy.

Building a new plant requires resources - land, labour and capital. Labour has to be found to help construct the plant and all the equipment that goes into it and some firm somewhere will be hired to build the machinery and equipment, provide the bricks, steel, cement, glass etc. that go into the building. If it is announced that Company X from Germany are to build a new distribution centre in the UK at a cost of £10 million, this effectively means that a whole host of firms will be getting additional work to the value of £10 million. It can also be expected that the additional income will find its way through the local economy. If additional people are hired, they will receive an income which they spend. Inward investment therefore can act as a trigger to generating wealth in the local economy. If a MNC is attracted to an area then this might also lead to other smaller firms in the supply chain deciding to locate in those areas. Other firms providing services to these firms are then attracted to the area and so on.

One of the main concerns about expanding rates of economic growth focuses on the effects of congestion, pollution and carbon emissions on the environment. Economic growth in China and India raises fears that the resulting environmental damage could have serious impacts on us all. Other observers say that it is hypocritical for those in the developed world to preach to those trying to develop their economies.Economic growth is the loss of ancient ways of life and cultures. As countries industrialise, natural resources can be lost as more land is sought. The loss of huge areas of the Brazilian rainforest to cattle-ranching is an example of this effect.

Other adverse effects could be

• The 'one size fits all' view of economic development prevents subtle differences in the routes chosen to development.
• The search for faster economic growth may prevent countries concentrating on social goals such as care for the elderly or children.
• The acceptance of materialism as a general goal in life.
• The homogenised global culture that some observers say has arisen.

It is difficult to find a clear definition of the term 'globalisation' but it is clear that it is associated with particular characteristics; the following is a list of some of those characteristics:

• Growth in technology
• Capitalist or market economic systems
• Corporate expansion
• Trade issues
• Poverty and inequality
• Impact on the environment
• Communication
• Brand expansion and recognition