Core Economic Principles
June 2, 2014
In today’s modern world, economies are looking for sustained and consistent growth; especially LDC’s who have stayed behind the pack due to specific event and situations. That is the case for the Dominican Republic, a “growing economy” who looks to make the most out of its labor force, natural resources and average market conditions. Since its beginnings, the DR has struggled a lot in possessing politic stability, all the way back to the beginning of the 20th century up until this day we still find the fate of many (citizens) controlled by the few (politicians). In his ...view middle of the document...
The blame cannot be put on President Danilo Medina since it was the only choice he had in his hands and while this contradicts the core economic principles it was a measure that had to be taken. Education is receiving a lot of attention lately because most of the Dominican families cannot afford it and leaves the population stuck in an endless loop where they do not progress, the same happens with the country, this means less businesses, less competition and thus wealth concentrated on a smaller percentage of the population whom cannot carry the economy forward on their own. Due to ignorance, Dominicans might need incentives for them to attend school and college since our culture does not fully understand its benefits, some of those incentives can be monthly cash payments or breakfast and meal each day that will in fact benefit the citizens in the present.
Market-based competition is another core economic principle on which the Dominican Republic has been able to work around and shape it to the country’s characteristics. Some sectors like the energy sector are regulated by the government, petrol pump stations must sell their petroleum derivate at the price that the government dictates it must be sold, the reason for this is the Dominican government benefits hugely from taxes on fuels and thus they must assure the price at which they sell it. Banks are also regulated by the SIB (Superintendencia de Bancos) and bonds trading posts by the SIV (Superintendencia de Valores) just to name a few examples. This completely differs with the US way of coping with the core economic principles as they believe in deregularization of most sectors and we can find different prices on their petrol pump stations as it’s a sector that sets prices based on competition.
Lastly a very relevant core economic principle which is very relevant in our day to day lives is that “All Choices Have an Opportunity Cost” meaning that an alternative course of action can be taken on...