Premier Division Case Study

Will U.S. be the top of the “premier division” of world economic in the future?
Introduction
In 2010, American GDP increased 2.9%, which is much lower than “BRIC”countries’ GDP increasing number, but this figure still higher that European GDP increasing number (0.7%).Some of experts begin to analyze U.S. by GDP Index and unemployment rate to prove that U.S. economic leadership will be replace by “BRIC” country. However, in this article, it will prove that U.S. economic will still be the top of “premier division” of world in the future by its unknown core competencies. These core competencies analysis will be divided by two parts, the first part is U.S. multinational corporation’s value chain integrations, which will compare U.S. Major Corporations
economic with EU and China (China will represent “BRIC” countries in context)
According to the April Economics periodical (2011), it analyzes the U.S. economy by two important factors which is economic growth perspective and unemployment rate particular less-skilled worker. Using economic statistical data, such as GDP, FDI, CPI etc, is the common way to evaluate a country’s economic in academia, while these data can simply assess the economy good or not, rather than core competence of economy. In this part, it will compare U.S. economy with Chinese and European economy by statistical data and global value chain integration.
It is obvious that China GDP growth is much higher than EU and U.S. GDP growth (see Figure 1) and EU GDP growth can not catch up with US during the booming. According to EU economic growth rate can not exceed U.S. and EU should solve its EU internal problem in the next 10 years (Deficit, Debt, Unified Financial), those who have ability to exceed U.S. to be the NO.1 in global economic will be China, so in this part the passage will focus on Sino-U.S.economic
financial market falling (Internet bubble, Real estate bubble), so some of experts predict that China will catch up with U.S. in economy in 2015.However, the premise of these kind of the prediction is that Chinese economy development is sustainable and changing its position in Global value chain integration. Actually, when scholars analyze economy growth by GDP, they neglect one of problem in GDP that what is the composition of the GDP and finding out where is the economic growth point according to GDP, then evaluate can these points grow sustainable .According to any of macroeconomic textbook GDP = private consumption + gross investment + government spending+ (export-import), (See Figure 2)U.S.consumption 2.1 trillion(69%), is biggest part of GDP and investment and government expense is nearly equal (2008),and China consumption 35% but investment plus government expense is nearly 60% in this year .Actually, most of13 %government expense focus on infrastructure ,and 47% of investment mainly focus on real estate and infrastructure in these 10 years .and the highway ,railway mileage and housing can prove the period of 10 year of infrastructure age. But can Chinese government increase investment and government to improve GDP growth rate forever or build more high speed rail as these year? The answer is absolute no, because both deficit