Question

In: Economics

It is very easy to start a corporation in the United States. Take a look at...

It is very easy to start a corporation in the United States. Take a look at how easy it is to start a corporation
in Azerbaijan or China. Do you believe there is a link between ease of starting businesses and overall economic
efficiency?

Solutions

Expert Solution

Countries and easiness to start new business
The United States rank 6 in the easiness of doing business in the year 2018-2019. There are no barriers for an individual or a group to form a corporation and start producing there in the US. The government does not restrict anything on to start something new there. Also, there is no difference for a native or a foreigner start a new business there in US.
China and Azerbaijan made the ranking as 31 and 38 respectively in the year 2018-19. When compared to US, both the nations are not that efficient to support a new corporation. Even though there are no much restriction for starting industry there in China and Azerbaijan, it is somehow higher when compared to that of US. The pressure of inflation in Azerbaijan is a reason that restricts inviting producers there even if the government support is very high. China being a tycoon for producers even holds some measures that force the producers or investors to follow so that they could be invested or start a new corporation there.
The less restriction to start business will surely attracts the investors and producers which helps the economy to be better efficient. Even the low cost of production in China and other nations are an advantage for them, the restrictions even if small will pull back investors and producers to approach the economy. But US being able to provide quick access for starting new corporations and providing investors better exemptions, people will be more interested in investing and producing there. And this is a major element that stimulates the economic activities.
  


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