Erik Schuetz

7/3/24
SLO 8
2301
Navarro College
SLO 8

Part I :

Economic growth is defined as the stable influx in the production of services and goods

in a country’s economy over a period of time. One primary measurement that helps us study a

country’s growth is growth domestic product, often referred to as GDP. This is the complete

market value of all goods and services produced in a country in a time period of usually each

quarter or year. As this statistic grows for a country we can generally tell that an economy is

thriving. There are other factors that play into a country’s growing economy such as a stable

government. This can allow for a conducive environment that helps investment and other

economic endeavors such as a stronger infrastructure thrive. When a state allows strong

investors into its economy, large industries can thrive that allow jobs and consumerism to

flourish. In turn when a government is strong enough to tax some of this money, it can feed into

making a stable infrastructure such as highways with less potholes, better public education, or a

new sewage system. In order to facilitate these changes though, there must be access to strong

banks in a stable banking system that incorporates a fast up to date online interface, and

customer trust. When banks are received as flaky, many people pull out their assets and it ends

up toppling the bank and temporarily halts investment into the state’s economy. This also halts

consumerism and therefore lowers a country’s rating of stability in its economy.

Part II A :
 Germany is an example of a country that is economically successful and has displayed a

vast amount of economic growth. Germany wasn’t always perceived as having a stable

economy at first though. After World War I, Germany took a war that it couldn’t afford for the

duration of four years. It came out of the war with numerous debts from war bonds to inflating

its own currency. The treaty of Versailles also left Germany with the “war guilt clause”. This

essentially placed all blame onto Germany which facilitated the passing of large debts to

Germany and land loss, furthering economic tensions. This led to Adolf Hitler rising in the

rubble to lead a very horrifying and distraught state of Germany. During this time the
government was strongly fascist and represented war socialism, which was rooted in some

similarities to communism. This system of government left Germany in ruin. Later Germany

adopted a socialist economy with a focus also strongly shifting towards a free market economy.

While some areas are still government regulated such as health care and energy, Germany

entered a form of economy that allowed for significant privatization, market competition, and

entrepreneurial freedom across various sectors. This allowed for businesses, industries, and job

opportunities to pop up, stimulating economic growth. This growth was kept stable though

through careful management of money, strong rules for how businesses operate(like monopoly

targeting), and smart spending on schools, research, and improving infrastructure. Germany's

tax policy is progressive, meaning higher income earners pay proportionally more taxes. The

country places taxes on goods and services, corporations, and various other taxes. These taxes

fund social welfare programs, infrastructure, healthcare, education, and other public services

that allow Germany to thrive but also remain stable. This stable government is also contributed

to by the EU. The country’s standing has improved drastically since World War II and now

allows it to engage with other alliances within Europe and elsewhere. The EU allows Germany

to facilitate trade with less tariffs within the union. This easy access to trade has increased

consumer willingness to engage with the economy through purchasing goods and services

further increasing the state’s GDP.

Venezuela is a country with a poor economic system. The country struggles with

collecting taxes fairly and has a history of failing to enforce contracts and property rights

uniformly. Its educational system and infrastructure are in poor condition, and law enforcement

is weak. These issues have significantly contributed to its slow economy. Venezuela’s unstable

government has also caused mass inflation, severe shortages of basic goods, and a substantial

decrease in real GDP. Despite possessing some of the largest oil reserves in the world,

Venezuela's government has failed to effectively harness and utilize these resources to foster

sustainable economic growth and stability. Absence of diversification in its economy has also

greatened its economic tensions. A good amount of these issues are caused by Venezuela’s

corrupt upper class. Due to the weak government, the state’s oil company PDVSA has

embezzled funds from oil contributions for personal gain.

Part III :

1- As an economic advisor, here are four recommendations to help an underperforming

country improve its economy:

2- Strengthen Institutions: Establish and enforce the rule of law to ensure that contracts and

property rights are protected. More investors will buy into a secure environment, making an

economy flourish.

3- Improve Education and Training: Invest in the educational system to develop a skilled

workforce capable of driving innovation and productivity. Institutions and other training

programs can create workers for a more diverse economy.

communication, and energy systems. This will facilitate trade, improve efficiency, and allow

foreign investment.

Part IV :

Learning about struggling countries has made me more aware of the complexities and

challenges these nations face. It has highlighted the importance of stable governance, effective

education, and sound government policies in achieving economic growth. I have realized that

my initial perceptions of these countries were often biased by stereotypes and a lack of

understanding to their unique circumstances. Understanding the cultural differences and the

historical context of their struggles has broadened my perspective and increased my empathy

towards their situations. Some differences in culture between struggling countries can be their

systems of preferred government. Venezuela for instance is a republic with too many economic

freedoms, but earlier times in Germany we’re fascist, having a tight grip on economics and

expending more than they were worth for war supplies.

Part V :

Works Cited :
Federal Ministry of Finance. "Germany’s Tax System." Bundesministerium der Finanzen,

//www.bundesfinanzministerium.de/Web/EN/Issues/Taxation/taxation.html

Kurmanaev, Anatoly. "How corruption and collapse brought Venezuela to its knees." The New

York Times, 14 May 2019, //www.nytimes.com/2019/05/14/world/americas/venezuela-

corruption.html.

Munichiello, Katrina. “What Is Economic Growth and How Is It Measured Investopedia,

//www.investopedia.com/terms/e/economicgrowth.asp. Accessed 3 July 2024.

Ritschl, Albrecht. "Reparations, Deficits, and Debt Default: The Great Depression in Germany."

European Review of Economic History, vol. 6, no. 1, 2002

"Venezuela's Struggles with Tax Collection." BBC News, 18 May 2016,

//www.bbc.com/news/world-latin-america-36319877

World Bank. "Economy." World Development Indicators, The World Bank Group,

datatopics.worldbank.org/world-development-indicators/themes/economy.html. Accessed 3 July

2024.