Chile and Haiti Analysis

b) As countries develop, the size of government will be larger as well. I have chosen Haiti, Cambodia, Chile, Cuba, Australia and Japan to be my analysis, below is a table A for my explanation. As you can see, the size of government in Haiti is $1.186 billion (2009 est.), $1.997 trillion (2009 est.) in Japan. Haiti is a less developed country and Japan is developed country. When one country develops, the government need to spend more to support the development. The spending on physical goods and service can improve the productive process, such as spending on the salary of teacher, health workers, defence force, etc. thus, Japan’s government need to increase the expenditure to satisfy the develop. They acquire higher salary to attract teacher stay in school to provide the knowledge to next generation as other industry may require more people to meet their needs. On the contrary, the less developed country, Cambodia, which government may just spend the normal rate on the expenditure; they do not need to put extra money to support the development. Therefore, the share of economy in Cambodia is 6.22% and 48.27% in Japan. Real per capita government expenditure will increase as well without the inflation, because population will influence the government expenditure as population will increase though the year.

Reliability and accuracy is an important part for the analysis. If the data which is not reliable, then the foreign investor may make a wrong decision or the government may overstate or understate the activity in the market. For instance, the GDP per capita in Cuba is $9700(2009 EST.). If the government do not know the trend of the economy, or doing the prediction without using the historical data or other accurate information, the government may believe that the economy is on expansion or recession, then, it would confuse the investor or the residents for making a wrong choice. Or using the investment to measure how well an economy is using its production,