Why Are Some Countries Richer Than Others?

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Why are Some Countries Richer than Others?

Poverty is still the biggest problem the world faces from day to day. Every country suffers from it to some degree, however certain places are greater effected than others. This is because the level of economic growth differs from country to country. The greater amount of growth the less room there is for poverty. This is simple reason why some countries are richer than others. If countries fail to move forward than it can present many problems. Mainly the needless suffering of many, and generally a lower level of living for all those caught in the trap. It is true that growth does create it own problems such as pollution and congestion, but these are acceptable compromises to reduce the …show more content…

A good example of this can be seen in 1960’s when East Asia achieved great success with economic growth. Another large factor that determines the wealth of a country is the amount of saving and investments that are present. If there is greater investment, in theory it means there would be faster growth and greater wealth, at least in the short run. Although investment is not enough my itself, it can be seen from the past that high investment does in fact improve these key factors. These isn’t true for all counties of course, for example, the communist state of the USSR had amazingly high investment though out the country, but due to bad economic policies else where they failed to improve the countries economic situation to any much degree.

Poorer countries many also face the problem of high inflation. Many of the third world countries today still suffer from ‘hyperinflation’. This means that every year prices are rising at a phenomenal rate. A country can become very poor through this, simply because people don’t have the money to buy the goods that they require. Therefore money does not circulate through the economy like it should, and the problem continues to worsen. Germany experienced this in 1923 and by the end of the year, prices were almost one million times greater than 5 years previous. Under these conditions people will

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