THE SIGNIFICANCE OF CHINA AND THE US ECONOMIC PERFORMANCE

According to Acemoglu et al. , (2001), a country’s GDP is measured in its money thus calling for a need to express the values in stable currencies when comparing economies of different nations (1370). Secondly, governments experience different population levels, but GDP provides a standard measure of solving this problem. For instance, the US economy has large population compared to the Mexico, and Canada. Therefore, analyzing the economy requires the need of using GDP because it is possible to divide the GDP with the population. GDP is considered as the most aggregate measure of an economy, and it is applied in accessing economic performance both in the UK and across the world. Also, economists use GDP value to explain financial performance either in its contracting or growing state.

According to Thirlwall (2014), the amount of GDP represents the total production in a country’s economy thus giving a comparable insight for determining economic growth (48). When a nation experiences higher gross domestic value, it means that it is doing well in production, consumption, and net trade. There is a possibility that small GDP of a small country is likely to be less than the income of a good country. , (2015), GDP in per capita form provides comparable insights about the standards of living in a particular country (1350). However, it does provide reliable information regarding the sectors of an economy or the social stratification. For instance, measuring Gross Domestic Products accounts for the expenditure on leisure and environmental protection but fails to include the actual levels of cleanliness and wellbeing of the society.

For instance, the USA economy experiences higher GDP value than Germany. However, it does not necessarily mean that the US has improved welfare that Germany. , (2015), even though GDP has various limitations, it is undeniable that it does measure production well and indicates when a country is experiencing a boom or recession (1800). For instance, higher GDP values indicate that the economy is at the boom and suggests that the economy is doing well regarding jobs and incomes. As a result, higher GDP occurs significantly with other improvements in real life situations such as education, health, and environmental protection thus providing a basis for comparison across countries in these sectors. Analysis of Economic Growth As noted by Routh (2017), the USA statistical data collected from 2008 to 2017 shows that the value of the country’s GDP in the year 2016 was approximately 18624.

48 billion. According to Xie and Zhou (2014), the nation has average GDP of 6994. 50 Us dollars by the year 2018 showing a significant increase production and improved living standards (6930). As noted by Lardy (2016), this value contributes to about 55% of the worlds per capita GDP indicating that the country has a considerable influence on the performance of world’s economy (94). The GDP is obtained by dividing the total GDP by the total population in the country. Therefore, a higher average of a Gross domestic product indicates that the economy has increased production level as shown in the graph below. A high number of low-income earners and unemployed people in a country tend to reduce the per capita GDP thus signifying a decline in the number of the level of living standards.

The reformation affects both the illegal and legal immigrants depending on wealth and worker skills which determine the productivity of an individual in the country. President Trump seeks to improve the lives of individuals in America by exercising a higher tax rate which aims at increasing disposable income. The primary target of this policy is the top individuals and corporations who have been experiencing heavy burdens of paying taxes. The plan nearly doubles the standard deductions and appears to be significant since there have not been tax reductions for a long time. After becoming the president of China, Xi Jinping set time frame for attaining two fundamental goals that would result in an increase in the country’s production capability. The primary objective of the plan is creating a moderately prosperous community in China where all people will have access to high living standards.

Increased social welfare will be reflected by increasing the country’s GDP to $ 10,000 by the year 20121. Secondly, Jinping divine’s mechanisms to ensure that the country is fully developed into a rich and powerful nation by the year 2049 if it meets the deadline for the first goal. China has a government exercises great concern on the nation’s rural development projects. According to Grimm et al. , (2008), the current population in China is 1,413, 750,189 which represents 18. 54% of the world’s total population (757). The country represents one of the nations with high population dependency but has high average GDP. Despite the high rate of population growth in the country, the citizens experience higher living standards compared to other developing countries such as Japan. Also, Chinese government uses its political and investment power to influence other countries such as Japan and India to enter into a contract with the Chinese government.

The US economy is still and continues to grow as the world’s largest market for exports and investment. The country has excellent infrastructural facilities that ease the movement of goods within the country thus compelling foreign investors continues establishing firms in the US. According to Dreher (2006), the country’s economy and offers substantial demand for commodities as the average income is $51, 017 which increases the purchasing power of the households (1098). Also, the dollar value is highly compelling in the world’s stock exchange market which attracts many people to invest in the country thus enjoying substantial benefits. Similarly, the US government focuses on rewriting the free trade agreements with North America by stating the future economic benefits that would result from the trade relationships.

Therefore, globalization and free trade appear to be the avenues through global economic growth can be achieved. EU/UK/ World Economy The UK/EU economy experienced economic crisis and low economic growth post the 2008 financial crisis. The first strike occurred in the year 2007 happened because the US economy had ignored the credit risks that would result from the reduced interest rates. Inadequate supervision of the financial institutions created an opportunity for additional business instruments to flourish in the economy thus contributing to the problem. The EU economy currently represents 15% of the world’s economic growth, and it is expected to continue going down. The economy has been experiencing slow and static economy growth which results from increased population thus lowering the disposable income.

One way to measure the sustainability and performance of an economy is to measure its GDP. Since the EU economy including that of the UK is sluggish, UK threatens to withdraw from the union because it is not beneficial. It indicates that the benefits resulting from unified free immigration are lower than the rate at which emigrants enter the country thus lowering per capita GDP. In an attempt to regain power, the US under president Trump decided to withdraw from the Trans-pacific partnership and engaged in bilateral trade with North America. However, the removal of the US from TPP partnership does not have a significant influence on the performance of TPP. Since Trump’s decisions can lead to the impact of the foreign direct investment and compel China to form corporations that promote economic growth across the globe.

Conclusion China and the US appear to be the two most significant economies contributing to world economic growth. The countries have a high population that provides a market for imported products. , Johnson, S. and Robinson, J. A. The colonial origins of comparative development: An empirical investigation. American economic review, 91(5), pp. , He, D. and Zhu, F. Financial crisis, US unconventional monetary policy and international spillovers.  Journal of International Money and Finance, 67, pp. Crafts, N. Prospects for global market expansion of China’s wind turbine manufacturing industry. Energy Policy, 67, pp. Gostin, L. O. How will President Trump’s policies affect domestic and global health and development? Jama, 317(7), pp. and Briggs, J. M. Global change and the ecology of cities.  science, 319(5864), pp. Handley, K.