Governments around the world are chartered with the goal of making their country’s economies grow and prosper. In doing so, governments rely on economists to help make decisions regarding policies that affect their economic productivity and standard of living. Productivity is defined by Mankiw, 2015 as “the quantity of goods and services produced from each unit of labor input” (p.239). Countries like the United States have a large economy with strong capital, such as physical, human, natural resources, and technological knowledge which allow a great output of goods and services or productivity (Mankiw, 2015, p. 242). When a country has an excess of services and products, this allows fruitful trade with many other countries; importing and exporting many goods that allows most Americans to enjoy great economic prosperity; particularly, when compared to many of the other countries around the world. While a countries location and availability of natural resources have a large effect on how prosperous or productive a country will be, the policies that govern these countries can also have a great effect on their economic growth. Policies which restrict or allow trade with other countries, education, and property rights have a tremendous influence on a countries economic growth.
Physical and Human Capital to Produce Goods and Services
One of the Ten Principles of Economics is a country’s standard of living are determined by the country’s ability to produce goods and services. This is one of the main areas economists and government policy makers focus their energy on to help increase economic growth. Productivity of a country depends on the capital available by the physical ...
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...Living in a democratic society like found in the United States helps the legislature and policy makers to make the right decisions. The tough part it seems is when the policy is not going great and a change is needed. The government officials could implement a plan with all new policies to evaluate the process after each quarter (three months) to monitor the progress of the actions and make changes as needed. In this way, the government could work in an iterative process of improvement and tweak the process as changes are required. Living in a Democratic society could make this process difficult as most changes to policy must be voted by congress to make changes. This is also true at the state and county level as well; basically, making change in a democratic government is hard to do, but it is the checks and balances and votes that make the system democratic.
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