Principles of Economics Essay Example | Topics and Well Written Essays - 750 words - 4

Principles of Economics - Essay ExampleFor example, this figure is equivalent to 9% of the German and 8% of the United States per capita GDP. Furthermore, in terms of nature of resources, China has somewhat a small holds of resources based on per capita criteria, which is not even parallel to a developed republic of a modest character. These facts reveal the extent of the economic gap between China and the developed countries, which sets it trailing behind (Wolf, 2005). To nourish the country on an economic growth path, the Chinese Government has the responsibility of making significant policy adjustments. These policies should be aimed at transitioning the country from middle-in go on to high-income status. This includes finding measures to pass on the social and environment imbalances, improving the access to healthcargon and education, setting targets to reduce pollution, expanding social protection, and increasing the countrys energy efficiency (Wolf, 2005). The judicature should as well as make efforts to discover a new road to industrialization, and modify the approach of economic development by developing a circular prudence, changing the industrial structure, improving the traditional industries and supporting the strategic and emerging industries. The disposal of China should also promote use of information technology to support industrialization, which in turn can spur the countrys competitive advantage especially in respect to its expansive manufacturing industry. It would also be extremely important for the government of China to continue focusing on its regional development strategies, including turning around the tendency of widening regional economic gap such as supporting the development of the western regions. The idea of supporting development on certain priority zones can be achieved by setting the national spacial development in an orderly and coordinated manner, which should also include coordinating between urban and rural areas development (Sun, 2003). Question 2 When we say that we are engaged in a global economy, we mean that we are engaged in economic activities that are beyond a particular countrys borders. This includes a situation where international corporations stop relying on production within the mother country and extend their activities to many countries around the world. The global economy is concerned with globalization of production in areas such as finance, markets, labor force and communications (Ernst & Ozawa, 2002). When we talk of free trade, we are referring to a situation where the government of a certain nation eliminates all the artificial barriers to trade, which are usually established to protect the domestic producers from competition from the international market, particularly originating from the trading nations. unbosom trade is known to increase production because nations are given an opportunity to concentrate in production of those products that they have a competitive adv antage. This enables countries to enjoy efficiencies that come from increased output and economies of scale. Free trade also promotes the efficiency of resource allocation hence spurring production efficiency. This is because individual countries are able to employ efficient use of resources, which potentially results to higher output (Ernst & Ozawa, 2002). On the other hand, despite the many benefits, there a number of disadvantages associated with free trade. This includes creation of geomorphological unemployment as a result of removal of trade