Economic activities take place everywhere in our life, some we can observe and some we cannot observe. Usually when there are more economic activities in one economy, the economy is very likely to be in its fast growth trend. Also the size of the economy can have more economic activities. Therefore, we can almost conclude to attract more economic activities, we need to have larger economies and more profitable opportunities. However, these two factors sometimes are naturally determined and cannot be changed within a short time period. Therefore we need to find some indirect ways to improve these two conditions of the economy.
Building infrastructure is an effective way. Improving infrastructure can create more jobs for people and create more projects for businesses, and building infrastructure itself is an economic activity led by the government actively. More importantly it can have a long term positive effect on the economy and attracting more economic activities, since the costs of transport and having access to more resources would be lowered. In addition, lowering tax rates is a way to create more profitable opportunities, as firms and individuals are easier to make profits and earn more incomes. From these two examples of indirect ways to improve the economic environment for economic activities, we can see that to create immediate impacts always needs the support of a big government. Without the support of the government, the process of improving the economic condition is a passive process. This is because apart from the government, no individual party have the power to make a systematic change on the entire economy.
Therefore, for any developing or underdeveloped countries, a smaller government is not a good way to help to generate strong economic growth.
No comments:
Post a Comment