• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Economics- Portfolio

Free essay example:

ECONOMICS SL COMMENTARY NUMBER 4- Economics/1B

Title of extract: IMF exec sees Asia's developing nations 'moving up the ladder'

Source of extract: Business World Online

Date of extract: 22 March, 2010

Word Count: 690

Date the commentary was written: 24 March, 2010

Sections of the syllabus to which the commentary relates: Section 5- Developmental Economics

        This article addresses the structure, stability, and growth system of developing countries.  One major point this article makes that is important to note is that all developing nations have different, wide-ranging preconditions and problems.  However, most of the time, solutions to problems and main issues are similar.

        Specifically, the article addresses certain problems faced by struggling countries in Southeast Asia.  For example, the need for basic public services such as health-care, food and shelter. Stable programs like these are necessary for sustaining an organized economy and a strong government infrastructure.  The article mentions that increased integration into the global economy is a very important aspect in the growth process. What creates a stable economy is a country's ability to cooperate with other countries, balancing imports with exports. Boosting competitiveness is also a crucial aspect of making sure that a country creates a stable role in the trade system.  Most of these developing countries are in Southeast Asia; therefore, in theory it should not be too difficult for international cooperation to come from larger economies such as China or Japan.

        These reasons, however, are only some aspects of these developing countries that make it difficult for growth.  For example, many countries have large deficits and public debt, high credit growth as well as inflation.  These are signs of a highly unstable economy, and are big issues that must be faced soon, or else these factors will only increase in multitude.  As the article states, the Asian Development Bank speculates that these countries would need to invest approximately $8 trillion over the next ten years in order to gain more prosperity in the next upcoming decades.  Figure 1 displays the change in the standard aggregate supply and demand curves as these problems are not faced.

        According to the article climate change is one of the greatest long term risks for the developing countries, specifically in Southeast Asia, since it is one of the most vulnerable regions of the world.  In order for long term stabilities, these countries need to adapt to these climate changes in order to be successful in its growth process.  It is thought that if climate change is not addressed, Southeast Asia could lose about 6.75% gross domestic product each year.

        There are many causes for the increase in poverty in these countries.  The factors that affect the change in poverty are the distribution of income, inflation, failure to include environmental degradation, and failure to consider the kind of goods produced.  These factors are prevalent in these countries.  Research shows that these countries are not prominent figures in the international economy.  There is no specialization of goods in these countries.  The increase in national growth often times harms the environment.  Thus, countries that struggle with growing or grow too fast, have negative externalities, such as harming the land by over-fertilization, or destruction of land and resources.  Much of the poverty in these countries is caused by the high levels of inflation in the economy.  Because there is little specialization, people are struggling to make a living through their individual trades.  Therefore, there is a lot of inflation.

        Developing countries have a lot of issues they need to face.  Debt and high deficit among basic needs among the population are just some of the problems that need to be addressed over the next few months and years.  These issues are only going to be faced if these countries have cooperation from other more thriving economies.  Many of these developing economies have dug themselves into a huge hole of debt, and although government spending may not be very possible in a downturned economy, it is the only way that some of these issues can be solved.  If these issues are face, these countries in Southeast Asia could grow to become reasonable assets to the global economy.

This student written piece of work is one of many that can be found in our International Baccalaureate Economics section.

(?)
Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Related International Baccalaureate Economics Skills and Knowledge Essays

See our best essays

Related International Baccalaureate Economics essays

  1. Extended Essay Economics

    While the pharmaceutical industry in Venezuela may be classified as an oligopoly, it's important to note that many of the traditional concepts of the "theory of the firm" model do not necessarily apply in Venezuela. Venezuela is a heavily regulated, quasi-socialist state.

  2. GPD countries

    The hidden economy is all output produced within a country in an illegal or not declared way. These are all self-employed workers who do not pay taxes, all grandmothers taking care of children (nonmarketable services), farmers who grow food for their own use, etc.

  1. Macro Economics Notes

    But there are limitations to GDP data. For instance take two countries - UK and France. The UK has the higher GDP. Does this mean that the UK is richer than France? Not necessarily as the difference is relatively small and so the differences are not significant enough to say conclusively that one is richer than the other.

  2. The role of MNC headquarter

    In the past corporations where centralized and formalized, and now they heavily rely on normative integration. For this to succeed they need socialization and this is a HR tasks. The transfer of international managers is examined in the following. Transfer of international managers For multinational corporations where normative integration is

  1. case study economics

    As NHS is a government funded subject, it is actually just a free service at the point of delivery. The taxpayers pay for this good; therefore it does have a market value indirectly through taxes. And it is not a resource that is available all the time, thus making it limited and not scarce.

  2. Growth and Development Problem Set - IB Economics exam questions and answers.

    * Consumption spending (C) - includes all purchases by households on final goods and services in the course of a year. * Investment spending (I) - includes all spending by firms on capital goods (machinery, equipment, etc) and all spending on new construction (housing, etc).

  1. LDC Essay Economics Barriers to Growth

    3 Net investment leads to more capital accumulation, which generates higher output and income. Methodically, higher income allows higher levels of saving. Savings enable investment, which leads to capital accumulation, which increases productive capacity and allows higher output.

  2. 15 Historical Economic Questions on Mercatilism and the Development of European Countries.

    or supply and demand to find the most efficient output and price for all. These balances, which Smith claimed to naturally occur, indeed found the most efficient medium between the buyer and the seller. Smith?s most compelling argument towards mercantilism in my opinion is easily summed up.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work