Economics of International Development

Economics of international
development

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
QUESTION 1...................................................................................................................................1
A Determining the required saving propensity to achieve the targeted growth rate..............1
B Determining the available alternatives for economic policies............................................1
C Analysing the Harrod Domar Model in terms with expected outcomes.............................2
QUESTION 2...................................................................................................................................3
Natural resource Curse and its various ways on which it will effectively materialise...........3
Causes of natural resources curse...........................................................................................3
QUESTION 3...................................................................................................................................4
A Evaluating the prototype balance of payments for developing countries...........................4
B Determining all sequence of steps for balance of payment which affect developing domestic
policies and Liberalization.....................................................................................................5
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................7

INTRODUCTION
To develop the business operations in an international market, there is a need to make
suitable analysis over the trade and finance, governmental policies and procedures in addition to
the economical level of such markets. Therefore, in the present report, there will be discussion
based on the operational ability of business in terms of meeting the financial requirements as
well as developing the industries at the international level. The report will evaluate development
model of Harrod Domar and ways to make appropriate development in the firm. There will be
analysis over the various steps in determining the balance of payment as well as bringing reforms
in economic development and promotion of liberalization.
QUESTION 1
A Determining the required saving propensity to achieve the targeted growth rate
Saving propensity:
This method is helpful in determining the increment in the incomer and the amount of
spending in consumption (Hochstein, 2017). Therefore, it is the proportional of additional
currency in context with household income. Therefore, it can be measured as:
MPS= Changes in savings/ Changes in income
In terms of determining the level of output the government is expecting 8% increment in
the economy and the coefficient of capital is 5. Therefore, it can be said that the expected output
will be=
5+8%= 5.4
thus, as to reach that level of output than there will be need to capital as:
5*5.4= 27 million of capital investment.
B Determining the available alternatives for economic policies
There has been various alternative economic policies which in turn helpful for the
country in terms of having the adequate national economic development such as Solow model,
Rostow model as well as various Foreign aid theories (Tarasova and Tarasov, 2016).
Solow Model: This model is helpful in determining the economic growth which usually
operates over three basic sources such as Knowledge, capital and GDP labour.
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