Question

find economic data for Japan, USA, India, Italy, Iraq, and Mexico. Specifically, find recent data for per capita GDP and government debt-to-GDP ratio.

1. Based on the data collected, do you think that debt is a problem faced by economically advanced countries, undeveloped countries, or both? Justify your answer.

PLEASE AT LINKS AT THE BOTTOM SO I CAN CITE THEM!

Answer 1

Japan:-

Per capita GDP in ( PPP terms ) = $40,846.

Government-debt-to-GDP ratio = 237.6

USA

Per capita GDP in ( PPP terms ) = $65,111

Government-debt-to-GDP ratio = 82.3

India

Per capita GDP in ( PPP terms ) = $2,171

Government-debt-to-GDP ratio = 70.2

Italy

Per capita GDP in ( PPP terms ) = $32,946

Government-debt-to-GDP ratio = 131.2

Iraq

Per capita GDP in ( PPP terms ) = $5,738

Government-debt-to-GDP ratio = 63.7

Mexico

Per capita GDP in ( PPP terms ) = $10,118

Government-debt-to-GDP ratio = 51.5

I think debt is a problem faced by both, developing as well as developed countries. Precious earnings of average tax payer is spent on paying interest payments for the debts taken by the countries, which leaves little room for the government to bring substantial policy change in developing their countries.

Countries such as Japan and Italy have seen stagnant GDP for years which shows huge negative impact of a higher debt level.

Therefore, counrties should look at debt as a last resort to use for making policy changes and gradually they should lower down their debts to sustainable level.

All the data given above was taken from IMF and World bank website.