Macroeconomic Comparison
A Macroeconomic Comparison of the United States of America and Germany (2002-2012)
Thomas Edison State College
GDP & GDP Growth Rate -
USA: GDP is an important measure of the health and wellness of an economy. GDP in short is, the total expenditure of an economy through its consumption, investment, government purchases and net exports. According to data release by the world bank, the United States has the largest national GDP on the planet by almost double its next closest competitor (GDP ranking). Using this fact as a starting point, it is logical to say that the United States has had the largest GDP for quite a few years and in-fact the US have been the worlds biggest economy since 1871 (Staff 2). The visual trend that can be seen in the graph is that the economy experienced fairly steady growth from the early 2000 's and then around 2007 we seemed to have leveled off a bit. I believe this to be because of a drop off in the investment component of GDP. Home prices peaked in 2006 and then over the next 5 years began to steadily decline.(Trulia) This decline in one component of GDP caused a stagnation of the growth in GDP that the US was experiencing and in 2009 actually caused the economy to retract. The retraction that was noted in the previous section is the first thing that pops out in my eyes. It is the only major point on the graph that dips well below the 0 rate. When it is looked at from a statistical point of view it is considered an outlier from the norm, but what caused this retraction? Could it be the result of high unemployment,or the large decreases in interest rates or inflation? The answer is yes, and I will elaborate on these points as we expand our comparison.
Germany:
When we take a look at Germany 's chart the first thing we notice is how much less they produce than the US. Germany is known for having some of the most skilled and efficient
Thomas Edison State College
GDP & GDP Growth Rate -
USA: GDP is an important measure of the health and wellness of an economy. GDP in short is, the total expenditure of an economy through its consumption, investment, government purchases and net exports. According to data release by the world bank, the United States has the largest national GDP on the planet by almost double its next closest competitor (GDP ranking). Using this fact as a starting point, it is logical to say that the United States has had the largest GDP for quite a few years and in-fact the US have been the worlds biggest economy since 1871 (Staff 2). The visual trend that can be seen in the graph is that the economy experienced fairly steady growth from the early 2000 's and then around 2007 we seemed to have leveled off a bit. I believe this to be because of a drop off in the investment component of GDP. Home prices peaked in 2006 and then over the next 5 years began to steadily decline.(Trulia) This decline in one component of GDP caused a stagnation of the growth in GDP that the US was experiencing and in 2009 actually caused the economy to retract. The retraction that was noted in the previous section is the first thing that pops out in my eyes. It is the only major point on the graph that dips well below the 0 rate. When it is looked at from a statistical point of view it is considered an outlier from the norm, but what caused this retraction? Could it be the result of high unemployment,or the large decreases in interest rates or inflation? The answer is yes, and I will elaborate on these points as we expand our comparison.
Germany:
When we take a look at Germany 's chart the first thing we notice is how much less they produce than the US. Germany is known for having some of the most skilled and efficient
References: Amadeo, K. (2012, January 8). Natural Unemployment Rate. About.com US Economy. Retrieved February 14, 2014, from http://useconomy.about.com/od/glossary/g Foreign Direct Investment in the United States GDP per capita (current US$). (n.d.).Data. Retrieved February 11, 2014, from http://data.worldbank.org/indicator/NY.GDP GDP ranking Staff 1. (2011, June 6). The 6 Most-Traded Currencies And Why They 're So Popular.Investopedia. Retrieved February 14, 2014, from http://www.investopedia.com/articles/forex/11/popular-currencies-and-why-theyre-traded.asp Staff 2 Knight, B. (2013, January 1). 'Hartz reforms ': how a benefits shakeup changed Germany. theguardian.com. Retrieved February 14, 2014, from http://www.theguardian.com/commentisfree/2013/jan/01/germany-hartz-reforms-inequality Mankiw, N TRADING ECONOMICS | 300.000 INDICATORS FROM 196 COUNTRIES. (n.d.). TRADING ECONOMICS | 300.000 INDICATORS FROM 196 COUNTRIES. Retrieved February 13, 2014, from http://www.tradingeconomics.com/ Trulia, Z