In: Economics
A government may attempt to influence the pace of economic growth through demand-side and supply-side policies, expansionary fiscal policies – lowering taxes to raise disposable income and promoting consumption.
Lower taxes, however, would increase the budget deficit and result in greater borrowing. The expansionary fiscal policy is ideally balanced in a recession when consumer spending falls.
Expansionary monetary policy (now usually laid down by independent central banks) – interest rate cuts will raise domestic demand.
Stability. A key government role is to provide economic and political stability that allows for the normal economic activity to take place. Political instability and conflict will deter investment and economic growth.
A nation that wants to increase its GDP per capita needs to come
up with policies that are aligned with current global trends.
Therefore, they will enforce the following Long-term planning-a
nation must set realistic long-term targets to conform to including
guidelines and expectations-including blueprints.
Industrialisation-all leading nations have grown as a result of
rapid industrialisation. Recently, their enormous manufacturing
sector has seen China and South Korea becoming strong
economies.
Infrastructure-a country which wants to develop needs to improve
connectivity for its people. This includes improving airports,
marine ports, railroads, highways, industrial centers, electricity,
pipelines and drainage.
In an ambitious country, education-training of people is crucial.
It is important to bestow quality technical skills on the working
population most through the use of trade schools. Basic education
should a right for the younger generation. For higher education, it
is best to balance university to trade school population ratio.
Family planning-a nation must ensure that birth-based population
growth is acceptable for long-term purposes.
Immigration-it's best to diversify a population as it makes a
country more responsive globally. Immigrants bring new talents and
philosophies to help nations flourish.
Power-Defense and domestic security are important to economic
development, as they reduce business costs. This requires regional
political stability.