ECONOMIC GROWTH IN DEVELOPING NATIONS

What is an Economy? An economy or economic system is the institutional framework of formal and informal rules that a society uses to determine what to produce, how to produce and how to distribute goods and services.

Review of Different Economies Traditional Economy- An economy in which customs and habits from the past are used to resolve most economic issues of production and distribution. Market Economy- An economy that relies on a system of interdependent market prices to allocate goods, services, and productive resources and to coordinate the diverse plans of consumers and producers, all of them pursuing their own self-interest. Norway and China are example of a mixed economy. Traditional- Bhutan based on agriculture. Market economy United States, Great Britain, Singapore, Australia. Command is North Korea and Cuba.

Review of Different Economies Command Economy- An economy in which most economic issues of production and distribution are resolved through central planning and control. Mixed Economy- An economy that has some combination of traditional, market, and command economies. Socialism- An economy in which the government owns some factors of production and has a role in determining what and how goods are produced. Capitalism; United States and Japan. Communism; Cuba and North Korea. Socialism; Canada, Germany and Sweden.

Developing Economies Mostly poor countries with little industrialization that are trying to become more prosperous and develop their infrastructure. In a global economy, the economic growth of all nations is important. Economic growth is an increase in real output as measured by real GDP or per capita real GDP. Chad, a country in Central Africa, is a good example. With foreign investment, it has started to develop its oil reserves for export.

Developing Countries Most people in the world today live in developing countries. Countries whose average per capita GNP is a fraction of that in more industrialized countries. Poverty, along with other factors, is rampant in most of these countries. Along with economic concern of these countries, there is also a humanitarian concern and political considerations.

Obstacles to Development Population Growth Natural Resources and Geography Disease and Substance Abuse Education and Technology External Debt Corruption War and Its Aftermath Capital Flight

Global Environmental Scan An analysis of the outside influences that may impact a country. natural resources investments in human and physical capital technical assistance public attitudes and beliefs property rights and free trade Political factors include government stability, trade regulations and laws. Economic factors include infrasturture, the quality and cost of labor, employees benefits, taxes, standard of living and exchange rates. Socio-cultural factors include language, holidays, religion and social and business etiquette. Technological factors include use of computers, faxes, phones and internet.

Resources https://www.cia.gov/library/publications/the-world-factbook/- http://www.theodora.com/wfb http://hdr.undp.org/en/data