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Sunday, August 3, 2014

Policy and Infrastructure Improves National Growth



The development of nations occurs on a constant basis. The policies leaders put in place have a huge impact on the success of any nation and can have long-lasting impacts. A paper by Carmignani & Chowdhury (2010) discusses how specific and broad focus impacts growth. They elaborate on four scenarios of development and the outcomes of each. 

Positive Growth and Decreasing Inequality: Occurs when there is growth in the economy but greater mobility of the classes. 

Positive Growth and Increasing Inequality: Occurs when there is growth in the economy but that growth impacts one class over another. 

Negative Growth and Decreasing Inequality: Occurs when growth is negative but there is greater mobility among the classes. 

Negative Growth and Inequality: Occurs when growth is negative but it impacts one class over another. 

The authors found through their analysis that strong policies and infrastructure improvements help create the right opportunities for a positive growth and decreasing inequality situation. Countries are not limited by their geographical locations, resources, or population. Any country can improve their standing by having the right policies and infrastructure.

Policies have legal implications for businesses and help create an environment for growth. The way in which companies structure, operate and develop are based in part on how they work within particular environments. Policies should focus on business and employment growth and ensure that the environment allows for proper wealth distribution and class mobility. 

Likewise, the infrastructure of a nation naturally can impact the success of business within a particular environment. Proper infrastructure will help ensure that products move quickly, information is transferred appropriately, and money moves easily. Infrastructure encourages growth from the foundations of an economy.

Carmignani, F. & Chowdhury, A. (2011). Four scenarios of development and the role of economic policy. Journal of Developmental Studies, 47 (3).

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