China 's Growth Rate Of Steady State Essay

Microeconomic reforms serve to make the chinese economy more responsive, productive and competitive in a global economic environment, ensuring growth and development. There is a need to upgrade chinese industry and limit development in capital intensive industries, and seek high value added

The purpose of this research report is to provide an overview of China’s economic growth in relation to the long term economic growth drivers. Critical assessment will be made on the growth drivers to determine whether they lead to long term economic growth.

Since the reform and opening up, the economy of China grows significantly, as an emerging economy, China's economy has made tremendous contributions to the global economy, and Renminbi has become one of the most important currency in the world. According to the survey conducted by China National Bureau of Statistics found that from 1979 to 2012, China has attained an annual average growth rate of 9.8% for its national economy, while the annual average growth of the world economy is only 2.8 % during the same period. In past 30 years, China's GDP surpassed Japan’s, China became the world 's second largest economy, in addition, the huge total volume of trade makes China become the world 's largest trading nation. The contribution of China’s

China economy experienced an incredible growth in the last few decades that made the country the 2nd largest economy in the world. When China started the program of economic reforms in 1978, it ranked 9th in nominal GDP but 35 years later it’s now ranked 2nd in the nominal GDP and been the world’s manufacturing hub. In recent years, China’s modernization propelled the tertiary sector and in 2013, it became the largest category of GDP with a share of 46.1%, while the secondary sector still accounted for a sizeable, 45% of the country’s total output. Meanwhile, the primary sector's weight in GDP has shrunk dramatically since the country opened up to the world.

Erik Brynjolfsson once said “The key to growth? Race with the machines”. Erik stated this in an argument against Robert Gordon. The two of these wise men had discussed innovation and had major differences. Robert believed that innovation would have an end, while Erik said growth would continue as long as the people kept up with it the innovations. I agree with Erik, because growth does not end; and it can continue as long as people race with the new productivity and don’t allow it to take over.

When a nation experiences a long-term economic growth, people have a positive attitude. There are opportunities for new jobs, new technology, and open doors for more capital for investment. The result of growth increases demand, supply, aiding the production of goods and services boosting consumers’ confidence. Economists believe the right type of growth that is stable and controllable is the best.

Any political changes in a nation result in a decline of investor confidence resulting in the withdrawal of investments in the nation leading to economic recession. The article notes that only time will tell the ability of China’s president to implement the Deng Xiaoping economic-reform strategy. In a demonstration of hyperbole, the authors note that the future economic growth of China represents a “$42 trillion question”, which represents the difference in the GDP gains in 2033 if the nations continue to observe progressive economic growth, in comparison to the projected growth during the next 20 years considering the world’s average (WSJ). There is an increased struggle to attain the balance in regard to the middle income-gap trap.
There are warnings from different economies that have predicted a

In macroeconomics, a large portion of discussion is devoted to economic growth. The output of the national economy as a whole represents our average access to goods and services. The long-run growth of the recent past represents everything from increase in access to running water and electricity to development of personal computers and the Internet. In short, it describes the heightened standard of living we enjoy today. Endogenous growth theory postulates that human capital and technology are central to enabling this growth. Human capital describes the stock of knowledge, habits, and social and personality attributes, including creativity and innovative ability. Paul Romer has made significant contributions to developing endogenous growth

China’s exceptional economic growth could barely be suppressed in China’s borders. Although China was both a giver as well as a receiver of economical communication throughout Eurasia. One of China’s many effects of their economic transformation lay in the dispersal of its tegnological advancements to people and places as the migration of soldiers, merchants, traders, slaves, and pilgrams, carried their accomplishments internationally. China’s unique way of manufacturing salt by solar evaporation spread to Christian Europe as well as the Islamic world. Papermaking, which started during the Han Dynasty, spread to Vietnam and Korea by the 4th century, Japan and India in the 7th, etc. Both printing as well as papermaking were both heavily affected

There have been recent concerns about the United States’ involvement with China’s economic rise. A concern about China’s growth surpassing the United States in economic size within the decade and regulating purchases of power. China’s economy grew in 1979 upon opening to foreign trade, investment and a free market. The increase of China's economy caused the gross domestic product to grow in 2016 by ten percent. China soon had the lead in being the largest economic manufacture, merchandise exporter and importer and holder of foreign exchange reserves. Their control as one of the largest economies encouraged the United States to have commercial ties with them. China's huge influence made it the United States’ second largest trading partner,

China, the most populous country in the world, has experienced an abnormal growth rate in Gross Domestic Product over the past decades. However, facts and statistics indicate an economic growth slowdown of the Asian giant.

More recent incarnations of growth theory, following Romer (1986) and Lucas (1988), endogenize steady-state growth and technical progress, but their explanation for income differences is similar to that of the older theories. For instance, in the model of Romer (1990), a country may be more prosperous than another if it allocates more resources to innovation, but what determines this is essentially preferences and properties of the technology for creating ‘ideas’.1 Though this theoretical tradition is still vibrant in economics and has provided many insights about the mechanics of economic growth, it has for a long time seemed unable to provide a fundamental explanation for economic growth. As North and Thomas (1973, p. 2) put it: “the factors we have listed (innovation, economies of scale, education, capital accumulation etc.) are not causes of growth; they are growth” (italics in original). Factor accumulation and innovation are only proximate causes of growth. In North and Thomas’s view, the fundamental explanation of comparative growth is differences in institutions. What are institutions exactly? North (1990, p. 3) offers the following definition: “Institutions are the rules of the game in a society or, more formally, are the humanly devised constraints that shape human interaction.” He goes on to emphasize the key implications of institutions since, “In consequence they structure incentives in human exchange, whether political, social, or economic.” Of

Can China continue to grow? China has been heavy on government capital spending and exports. China’s capital spending is usually under infrastructure such as: roads and bridges, and they have been doing some testing to see where 3D printing can help continue to drive the economy. China has been testing the use of 3D printing for houses and other infrastructure as a possible avenue to continue having capital spending as a powerful driver in the Chinese economy. Exports are another vast driver in the Chinese’s economy where mass production is a part of total exports. Future 3d printing can be seen as a strength with products that are custom and more complex. China is trying to move towards an economy driven by consumer spending. Fine-tuning an economy is very difficult. As you can see from the chart, Chinese growth has slowed down very significantly. Still the levels are higher than many other countries, but the slowdown is clear and the transition to that slow down can be seen as problematic. The blue line is related to the value of the yen and that has weakened in the last two years as well (Mitchell, 2015 para. 13). This has happened because China has allowed its currency to appreciate. That can be related to Chinese competiveness dropping for the last 2 years. This could have bad results for the Chinese economy.

The economic growth slowed down in the past 3 years. The GDP growth decreased from 7.76% in 2013 to 6.9% in 2015. At the same time, as a big contributor to the total GDP, the proportion of the second industry decrease, while the tertiary industry replaced the first place and accounted for 50.5% (National Bureau of Statistics of China 2015), indicating that China is trying to change its economic structure. Besides, the CPI figure shows a steady decrease, while the disposal income gradually rises. In brief, the performance of the economic indicators shows that the economy of China is slowing down.

This can be measured by the following formula; Per capita nominal GDP = Nominal GDP / Population, Per capita real GDP = Real GDP / Population. Seven factors determine economic growth. Natural resources such as land, mineral deposits, waterways; climatic conditions provide an essential foundation to economic growth. Combined with the other resources of capital, labor and enterprises, natural resources can be developed and organized to increase the productive capacity if the nation. Consequently the quality and size of the labor force is a major determinant of economic growth. Education and vocational training are essential the growth potential of a nation. The promotion of education and job training schemes increase the knowledge, skills and flexibility of the workforce that contributes to potentially higher levels of productivity and efficiency. Whether from natural increase or immigration population growth can cause a higher level of economic growth. An increasing population requires increased public spending on housing, education and other social needs while businesses expectations of