Factors such as corruption, consumer behavior, interest rates, health, and the environment can affect economic development rates. Corruption negatively impacts development by misappropriating funds, while anticipating consumer trends is crucial for sustaining development.
There are many factors that can affect the economic development rates of various countries and societies. Some of these factors include the environment, corruption, consumer behavior, interest rates and health. All of these factors are capable of affecting rates of economic development, either as a single factor or in various combinations.
Corruption is a factor that negatively affects the economic development rates of several countries. Corruption exists in many forms and often has a detrimental effect on the members of the societies in question and their rates of economic development. More often than not, public figures engage in secret and arbitrary personal enrichment at the expense of the country’s citizens and to the detriment of the economy. Money that could be used for the development of the economy can be transferred to personal bank accounts.
Sometimes corrupt officials engage in price inflation for certain projects so that they can make money off that project. An example is a corrupt governor who can award various road building projects to selected contractors at a rate that may be more than several times what the project is actually worth. Excess money can be shared between the corrupt official and his cronies. This misappropriation of funds affects the economic development rates of many countries.
Consumer behavior is an important factor related to rates of economic development. Consumer needs and preferences change and change very often. The job of various financial experts is to study market and consumer trends in order to anticipate these changes in order to take proactive measures to mitigate the effects. For example, a large manufacturing country with an economy dependent on items such as cars and other forms of vehicles should be able to predict that there is an effort to move away from vehicles that use fossil fuels.
Most car companies have already presented several prototype versions of vehicles that run on alternative forms of energy, such as electric and hybrid cars. It’s pretty clear, based on the effects of climate change and the need to be more environmentally responsible, that there will be more demand for these vehicles in the near future. Various government policies also affect the decision to manufacture these vehicles. The ability to predict such consumption trends is a factor in sustaining rates of economic development.
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