China Macro-Economical Policy Recommendations

[Date of Submission]

Abstract

This paper aims to construct a case study which examines a country from a macroeconomic standpoint and provide policy suggestions based on specific conditions of that country.

Table of Contents

Introduction3

China3

Macroeconomics4

Thesis Statement4

Discussion5

Recommendations in Policy Procedures5

Industrial Consumption6

Monetary Policy Recommendation8

Conclusion9

Introduction

For the basis of the case-study, we shall be evaluating the People's Republic of China because it is one of the fast emerging, biggest and growing industries. They are become worldwide leader of manufacturing goods. Their exports range from technological advancements to the fabric industry.

China

The People's Republic of China boasts a population of approx. 1.3 billion people, thereby taking the title of being one of the most highly populated countries in the world. The total area of the country is around 9.6 km and is the second largest country of the world, (by area of land).

After the economic reforms were introduced in China in 1978, it became one of the fastest increasing economies of the world. After the year 2012, it came in second in terms of economy size in comparison to the US, by both the purchasing power parity and nominal GDP. It is also the second biggest importer and largest exporter of the world. It had a total GDP of roughly US$7.298 trillion by the calculation and records of the IMF (International Monetary Funds).

China has worldwide recognized nuclear weapons at its disposal along with the biggest standing army of the world. It's no surprise that in order to foster such a formidable military might China has the world's second biggest defense budget. China is starting to be classified as a potential superpower by military analysts, academics, economic analysts and public policy makers.

In 2011, the PPP of China's GDP touched approx. $11.316 trillion, matching $8,394 per capita. China's primary, secondary, and tertiary industries in 2009, added to around 10.6%, 46.8%, and 42.6% respectively to the gross GDP of the country.

Macroeconomics

It is sublet of economics that caters to the structure, performance, decision-making and behavior of the whole economy. It is inclusive of global, national, and regional economies. Macroeconomics and Microeconomics are two of the most common fields of economics.

The macroeconomists make it their job to analyze indicators like unemployment rates, prices and GDP in order to evaluate the functions of the economy. They create models to understand and portray the relationships of variables like output, income, unemployment, consumption rates, savings, inflations, international trade, finance and investment. The micro-economics on the other hand focuses on the individual actions of agents, like consumers and firms, their behavior effects on quantities and prices on specific markets. There are two researches that are a trademark of macroeconomics, consequences and causes of short run fluctuations of the national income (business cycles) and way to figure out the long run determinants of economic growth. These models and their prediction are employed by the large corporations as well as the Governments to help them in the evaluation and the development of the business strategies and economic policies.

Thesis Statement

“To create a case study which examines ...