Growth v. Equilibrium - avq

Growth v. Equilibrium

        An objective that most countries aspire to achieve is economic equilibrium. That does not mean necessary means that in order to achieve that, a country’s economy must only grow. In actuality, a decline in the economy could be necessary. Moreover, if you not mind, I will incorporate what I have learned in Macroeconomics in this blog post. An important notion that reoccurs in class is a country’s GDP. GDP can identify a country’s sum of the market values or prices of all final goods and services. Now, since GDP refers to the aggregate total, we must view the aggregated demand and supply curve of a country. This determines if the country is in a recessionary, inflationary, or equilibrium period. From there, the government can decide which fiscal and monetary policies they would like to implement that would affect the economy. Naturally, if a country is in an inflationary period, growth will only escalate the circumstances. Hence, growth should not be the primary objective of international economic policies. 

             However, rather than discussing the practicalities of macro, let me inform you, in my opinion. I believe that achieving equilibrium is the goal. If you tip the scale too far on either side, it creates an unbalance. And to have a prosperous economy, we must fix these imbalances as soon as possible. However, while that is the most central goal, there is another goal within that one. I also believe that the government must attack poverty. For instance, if the lower-class workers received a higher wage, then that would increase consumer consumption, which would then lead to a growth in the economy. 

           I am not opposed to that. However, if it gets to the point where the high wages lead the economy into an inflationary period, then growth does not become the top priority. In addition, it differs for each countries’ economy. Each country perceives growth differently. For example, the United States is generally “well-off,” growth is not as significant per se in Senegal. For those countries who are economically disadvantaged will believe that growth is necessary.

          Moreover, I do not disagree. My thoughts are that economic growth has its ceiling—which is different for all. However, I feel that institutions should be concerned about lower-GDP countries that struggle to reach equilibrium than those super nations. Also, if these disadvantaged counties do not have an economic policy established, then it becomes our responsibility to help them create one. However, not to forget that all of this help is for the United States’ best interests. If the United States can gain another trade partner, then economic prosperity will occur on both ends. ☼