LEARN MORE...

Comparative And Absolute Advantages

Content type

User Generated

Subject

Economics

Type

Homework

Uploaded By

puevfflq909

Pages

Showing Page:

1/4

Running Head: COMPARATIVE AND ABSOLUTE ADVANTAGE 1

Comparative and Absolute Advantage

Name

Instructor

Institutional Affiliation

Date

Showing Page:

2/4

COMPARATIVE AND ABSOLUTE ADVANTAGE 2

Economic growth refers to the long-term expansion of the productive potential of a

country’s economy. In other words, it is the increase in the capacity of a country to produce

goods and services from one period to another. Traditionally economic growth is measured

regarding the gross national product (GNP) or gross domestic product (GDP). From this

definition, it is evident that economic growth is the increase in the aggregate productivity of a

country (McConnell, Brue & Flynn, 2015). It should be noted that economic growth varies from

one country to the other since economic drivers tend to differ from one country to the other.

Events such as political instability, wars, famine, and high unemployment rate hinder economic

growth of a nation. Economic growth of Japan, Saudi Arabia, and German, therefore, varies

because the three countries have different growth in the size of the active labor force available

for production (McConnell, Brue & Flynn, 2015). On the same note, the three countries have

different economic policies such as open markets for international trade and development, and

human capital differential.

Saudi Arabia, for example, tends not to be a market-oriented economy and in this case,

foreign companies find it hard to establish their presence in the Saudi Market. Most countries in

Western Europe including Germany tends to be more open to international trade and

development and this spurs the high level of economic growth in these countries. Japan tends to

enjoy a high level of technological advancements and innovation, and this has helped the country

in driving productivity and economic growth (McConnell, Brue & Flynn, 2015). The three

countries have different economic policies which encourage trade and development at the same

time they have varying levels of technological advancement and innovation that drive

productivity and economic growth.

Showing Page:

3/4

End of Preview - Want to read all 4 pages?

Access Now

Unformatted Attachment Preview

Running Head: COMPARATIVE AND ABSOLUTE ADVANTAGE Comparative and Absolute Advantage Name Instructor Institutional Affiliation Date 1 COMPARATIVE AND ABSOLUTE ADVANTAGE 2 Economic growth refers to the long-term expansion of the productive potential of a country’s economy. In other words, it is the increase in the capacity of a country to produce goods and services from one period to another. Traditionally economic growth is measured regarding the gross national product (GNP) or gross domestic product (GDP). From this definition, it is evident that economic growth is the increase in the aggregate productivity of a country (McConnell, Brue & Flynn, 2015). It should be noted that economic growth varies from one country to the other since economic drivers tend to differ from one country to the other. Events such as political instability, wars, famine, and high unemployment rate hinder economic growth of a nation. Economic growth of Japan, Saudi Arabia, and German, therefore, varies because the three countries have different growth in the size of the active labor force available for production (McConnell, Brue & Flynn, 2015). On the same note, the three countries have different e ...
Purchase document to see full attachment

Tags: business economics ECO561 Countries