Topic: What is the cause of economy rise and fall. - page 6. (Read 1470 times)

The main reason why some of the economies are growing gradually while others are prone to volatility is 'Demography'.

If there is a huge difference between the per capita income of the richest 10% and the poorest 10% of the population then economy is more inclined to inflation. Rich will invest/spend which in turn generate more cash flow in the economy, thus per unit value of money will fall. However, this money will not reach poor segments. So poor will become poorer while rich will become richer. Such economy will rise dynamically during boom period but fall miserably during recession.

However, if the standard of living of the people in economy is at par i.e. per capital income of whole population is within short range then economy will be inflation-proofed most of the time. The spending/investment will be distributed equally among the factors of production. So any inflation could be countered by the increased incomes.

I think it all depends on the government of the country, on the general ideology. Let's look at Norway. Stable stable growth. Or Nepal - stably bad. Well, Norway has oil. But Russia also has oil. In which country is the economic situation better?

I agreed with you that bribing is the major reason why some economy are not constant.
And government is another major reason too why their is not flow of economy due to their competence in office to strategies things that will benefit masses.
I stand fully to support the motion that bribery is what brings down economy due to mismanagement.

I would say the bribes are the biggest reason. Now you might question how could bribing change the economy so much? Well simply the rich companies bribe the powerful people and whenever those rich peoples business is not going that well you see that powerful people manage to find a way to recover it for them. So, bribes is the best way to make the companies go up and down all the time instead of just down.

If there was no bribing, if there was no bail outs, if there was no economical packages that helps big corporations we wouldn't be in this mess. Companies who do not get help would have two options, either run the company properly without too much risks and troubles or just declare bankruptcy. Since, it is not like that they just risk it all to earn as max as they can and either they succeed which is rise or they fail which is fall.

You are either wrong on this or that you are not good at describing this. In easier term , Fiscal Austerity is a way for the goverment to get more money to pay their debt through some option such as raising tax or cutting down their budget on few non important things.

By doing this, the country might be hurting themselves in a longer term and their economy might keep falling until certain period of time. Increasing taxes will only bring more harm to their citizen

Population is also a factor of the recession that occurs and there are many other factors which of course all involve many sectors such as employment, tourist attractions and many more which of course there will always be ups and downs in the economy because such things can also occur depending on the season, so the ups and downs of the economy are something that usually happens but if it is related to the crisis that occurs because of a pandemic then of course it is something different.

With something as complex as the economy it is very difficult to come to a simple answer which is why when there is an economic crisis and people want to know what it is causing there are hundreds of explanations about why it is happening, one of the simpler explanations is that this is just the way the system is designed, there is something called the boom and bust cycle, as you may guess during the boom cycle there is easy credit for anyone and plenty of jobs because of it but then after some time a bust cycle emerges as people use that easy credit for unnecessary stuff and jobs are lost and credit is more difficult to get.

A reductionist answer would be that the cause of the rise and fall of the economies comes from policies regarding how credit is given and the monetary policies of governments.

Yes the population of a country can in some ways affect the economy, and that’s when there is increased famine.
Having famine can affect the economy in lots of ways I guess. As for the government, I think they also play their own part in ruining an economy. If they are not doing the right things they are meant to do the economy of that country will be falling.

The way (or one of the ways) that the government can make their economy to fall is through what is called fiscal austerity. Fiscal is the government’s budget and the word I first mentioned has to do with when government decides to cut budgets.

It really does.

Some companies have to lose their employees just to sustain their businesses and that's one big impact by this pandemic.

I hope that it will end as soon as possible. I've read some good news about this miracle pill/medicine.

Governments of every country should be aware about the damages brought by this pandemic in all sectors. Business sectors are really suffering because of the prohibited operations of small and large businesses. Some businesses are losing due to the risk of getting the disease from its customers once it opens. The government should have a proper and precise plan before implementing other possible actions. New set of rules and regulations should be studied and implemented so that we can lessen the risks of getting the disease when we try to open businesses. Even those malls, clinics, offices, and etc., should follow the guidelines regarding the safety of all and to recover economically.

If the government is not performing well and not planning all of its actions, then people will really suffer from its passiveness. Authorities should become more aware about our economy due to economic crisis that we are experiencing because it can increase our taxes that we need to pay as this pandemic is still ongoing. Although the government implemented GCQ where businesses are open, still the plan is not that safe and studied enough because of the constant increase in covid-19 cases. Probably, our economy will really have a hard time recovering because our government is not prioritizing its economy and people. They focused on other issues like, political condition and other laws that are not necessary during this pandemic. They don't think about how they can make our economy stable enough.

This pandemic brought recession to our country that's why the economy is consistently going down and economic activity are being stopped due to the risk of the covid-19. Population and businesses are really a big factor in helping the economy to rise. This GCQ really helps some businesses to operate and undergo a "new normal" just to make it happen.


USA, Brazil, and India are most countries that have a huge infected cases right now. US really have a hard time recovering from their economy because of the protests that are happening in their country. In India, the use of cryptocurrency are being prohibited again because they don't see it as an effective tool to recover economically because of their authority.

Probably, this pandemic will lasts longer.

Each citizen who already has the right to vote should use his vote in the election. If someone has high ideals and are confident that s/he can make positive changes there is no harm for the millennial generation in politics, only if s/he has entered politics should not be carried away by the current corrupt and oligarchic practices that are common in politics.

We must have clear knowledge and data about what the government is doing so that we can get involved in policy formulation. Eliminate the assumption that politics is just the opposite, we must understand politics and government in order to contribute.


Whatever happens in a country, especially in large countries depends on how the government, especially the head of state, governs a country. Although the national interests are the same (the grand plan remains unchanged), different leaders differ in strategy and policy. Take for example the era of Obama and Clinton, the United States is very close to China. Unlike when Trump's era, China became an opponent, not a strategic partner.

Likewise, China under Deng Xiaoping and under Xi Jing Ping has a very different foreign policy. Under Deng, a Chinese reformer opened himself up to bring about rapid development in China. While Xi is an innovator who initiated the China Dream or the Great Revival of the Chinese Nation, to restore the glory of China, namely the one belt one road program.

Natural resources and human resources in a country can be a bonus that can be disastrous depending on the ability of the government in the state and managing all potential bonuses and potential disasters that exist in the country. Almost all countries are based on laws and constitutions in force in those countries. One of the strengths of leaders is that the decisions chosen are legally recognized and are binding on all citizens. So the leader remains a determining factor for the progress or setback of a country.

Yeah I agreed with you that money been stagnant can cause down fall of economy because the money is not in function to bring another.
With money you can setup another infrastructure that will bring income  for society  and reduces the rate of unemployment to people.
 but a situation money is been dumped for years what is generating nothing.
Therefore government suppose allow money to circulates to people who needs it to activates growth of society and economy.

I don't believe in the economy being Constant. There's no such thing, especially in the category ECONOMY , which has a lot of factors that are directly correlated to people and their behaviors. Imagine that there are a lot of people who don't spend their money, it's already a factor. No circulation of money anymore would happen, and it could make the economy fall. This then correlates to the population of the country. Additionally, there are foreigners as well to consider. It can get more and more complicated when adding additional parameters.

One thing is for sure is that the government has significant control over what happens in a country's economy, and what the government does will affect it, whether it rises or falls. It's too complicated, IMO.

Conflict can destroy a country's economy very quickly This is a responsible government If the government wants this war to end it will not have any effect on the country's economy. The country's economy is generally stable and a lot of allocations are made to the country's economy by presenting a budget every year which helps to improve the economy However, if trade and commerce are shut down due to conflict in a country and an epidemic occurs then the rise and fall of the economy have taken place However, the government's GDP does not last very long.

Bad government is the other side of the coin when it comes to the fate of a country's economy in my opinion, the other side would be the people of the said country, the population in China is not just an employment thing, the other thing about it is the consumer base is so large, companies are vying to get their hands in Chinese soil which in turn makes tax that helps in government funding and spending. We also should consider the GDP of a country because they serve as an indicator whether they are prospering or not. War in my opinion is just an off shoot of bad government.

Bad government, I agree to that. China was able to accommodate the large number of population with smaller unemployment percentage compared to another countries. More business establishments, more employment for the citizens, means more income for the local and national government.
Most common reason for the fall of economic state of a specific country is the corruption.
Another thing would be the war, calamity, and pandemic.

In democratic countries, I'd say generally that's because of the failure of the people. Even if they (just for thought experiment) manage to buy ministers, a president, etc., from the best country, not necessarily the mentioned country will be prosperous.

To be more precise, lots of falls in the economy were caused by corruption, wars, and lack of risk management. Therefore, people need to check what the government is doing and be more proactive.

https://www.investopedia.com/articles/economics/08/past-recessions.asp

I tend to agree that probably it is government + population = Gross Domestic Product (GDP) results. These have a big role in economy of the country.
The aggregate demand will increase for sure if the growth of the population also increased. So technically analyzation, this might the reason for the economy rise and fall because when population increase and the productivity are low it can change the real GDP and the total income was adjusted for inflation which causes volatility, IMO.