To achieve political stability, the government would have to focus on fiscal responsibility, enhancing credibility, and long-term investment decisions such as infrastructure. According to the International Fiscal Affairs Department, “Research indicates that a sound fiscal position is key to achieving macroeconomic stability, which is increasingly recognized as a critical ingredient for sustained growth and poverty reduction.” Fiscal responsibility can also mobilize domestic savings, increase the efficiency of resource allocation, and help meet development goals. The IFAD goes on to say, “As private sector savings are often low in developing (especially low-income) countries, fiscal policy can play a central role in mobilizing resources by raising
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Do wealthier countries have a moral or ethical duty to help less developed countries provide an adequate standard or living for their citizens? Yes, they do! If anything the wealthier countries have to be willing to communicate and work with the less developed countries. They should collaborate on policies that make the less developed country’s economy open to trade and investment with the rest of the world. They should encourage other foreign direct investment. These are needed for sustained economic growth. In addition developed countries should reduce tariffs and import quotas. Obviously, they could provide direct debt relief. The International Monetary Fund reports that, “No country in recent decades has achieved economic success, in terms of substantial increases in living standards for its people, without being open to the rest of the world.” Developed countries could also reconfigure foreign aid. As of this year, only 1% of our foreign aid is humanitarian aid. Prosperous countries should really try to aid and help less developed economies, it is going to benefit both in the end. With that said however, prosperous countries should not take it upon themselves to impose their beliefs and aid on a country that does not want it. It should be a mutual agreement between all participants to ensure the greatest …show more content…
Since the less developed country is brand new to the market and has less capital then the developed. Their goods will be sold at a price that is far below that of the developed country. This will in turn drive the prices of the market down. LDC economies could also threaten the standard of living in developed economies. Basically as the workers, from LDC, enter the trade workforce they will begin to offer close to, if not, the same service for a fraction of the price. Competitors will be forced to cut the prices they charge or be forced out of the market completely. Either way the worker from the developed country’s standard of living will be drastically
Do wealthier countries have a moral or ethical duty to help less developed countries provide an adequate standard or living for their citizens? Yes, they do! If anything the wealthier countries have to be willing to communicate and work with the less developed countries. They should collaborate on policies that make the less developed country’s economy open to trade and investment with the rest of the world. They should encourage other foreign direct investment. These are needed for sustained economic growth. In addition developed countries should reduce tariffs and import quotas. Obviously, they could provide direct debt relief. The International Monetary Fund reports that, “No country in recent decades has achieved economic success, in terms of substantial increases in living standards for its people, without being open to the rest of the world.” Developed countries could also reconfigure foreign aid. As of this year, only 1% of our foreign aid is humanitarian aid. Prosperous countries should really try to aid and help less developed economies, it is going to benefit both in the end. With that said however, prosperous countries should not take it upon themselves to impose their beliefs and aid on a country that does not want it. It should be a mutual agreement between all participants to ensure the greatest …show more content…
Since the less developed country is brand new to the market and has less capital then the developed. Their goods will be sold at a price that is far below that of the developed country. This will in turn drive the prices of the market down. LDC economies could also threaten the standard of living in developed economies. Basically as the workers, from LDC, enter the trade workforce they will begin to offer close to, if not, the same service for a fraction of the price. Competitors will be forced to cut the prices they charge or be forced out of the market completely. Either way the worker from the developed country’s standard of living will be drastically