The Balance Between Markets and Intervention
Part 5
After researching the status of Chad as a developing nation and why it started off as a developing nation and continues to be one, it seems that Chad uses a small combination of market-led and interventionist strategies, as any country does. Most of Chad's few governmental policies favor maximizing the role of government in order to minimize the free operation of demand and supply in markets, these being the interventionist policies. These include promoting economic growth and development through providing young Chadians with education. This is seen thorough the numerous programs Chad has set up through itself and Non-Government Organizations, which work to increase overall education and development throughout Chad starting with the young people, hoping to create a cycle of education, which will help future generations of Chadians for years to come. Through this interventionist strategy, production should increase in the long run, due to better communication, education, comprehension and longer life expectancies/better health (all from education!). Since production increases, GDP will increase and result in economic growth, as well as higher incomes for Chadians, resulting eventually in higher living standards and economic development. There are also projects underway to improve the infrastructure of Chad through certain projects that would increase economic growth and development within Chad. The government of Chad also uses foreign direct investment and aid to increase road density and to provide health care to its citizens, increasing economic development.
These things are all very well and exciting, but Chad does not have a balance between market led policies, which involve no government interaction since the free market forces in the economy will provide the good/service, and interventionist, where the government has a direct hands-on approach. This is largely due to the corruption of the government in Chad, and the current leader wanting to maintain his control over the country. If there were a more fair and less corrupt government in charge, I'm sure there would be more market-led approaches to improve goods and services in areas that will be provided in an economy under normal circumstances.
Right now, since Chad does use interventionist strategies, they may have to wait for a while to see the benefits, since many initiatives that governments lead take years to show positive results. For example, education takes many years to train kids, and then see it applied to their careers and the economy.
I suggest that in the future, if the corrupt government decided to help out the Chadians or if they are overthrown, that Chad take a combined approach. Combining market and interventionist approaches would be beneficial to Chad since it will provide the most range of necessities that the country needs like infrastructure, health care, education, sanitation and trade liberalization. There would be negatives to favoring one side too much. If Chad focused solely on market approaches, goods that created a positive externality would be underallocated, and the tragedy of the commons would befall many of the public goods available. A pure interventionist approach may misallocate resources and stunt the country's natural growth. In the future, if Chad were to focus on its economy and keep creating programs to improve economic growth, economic development will follow soon after and Chad will be on its way to being a developed nation.
After researching the status of Chad as a developing nation and why it started off as a developing nation and continues to be one, it seems that Chad uses a small combination of market-led and interventionist strategies, as any country does. Most of Chad's few governmental policies favor maximizing the role of government in order to minimize the free operation of demand and supply in markets, these being the interventionist policies. These include promoting economic growth and development through providing young Chadians with education. This is seen thorough the numerous programs Chad has set up through itself and Non-Government Organizations, which work to increase overall education and development throughout Chad starting with the young people, hoping to create a cycle of education, which will help future generations of Chadians for years to come. Through this interventionist strategy, production should increase in the long run, due to better communication, education, comprehension and longer life expectancies/better health (all from education!). Since production increases, GDP will increase and result in economic growth, as well as higher incomes for Chadians, resulting eventually in higher living standards and economic development. There are also projects underway to improve the infrastructure of Chad through certain projects that would increase economic growth and development within Chad. The government of Chad also uses foreign direct investment and aid to increase road density and to provide health care to its citizens, increasing economic development.
These things are all very well and exciting, but Chad does not have a balance between market led policies, which involve no government interaction since the free market forces in the economy will provide the good/service, and interventionist, where the government has a direct hands-on approach. This is largely due to the corruption of the government in Chad, and the current leader wanting to maintain his control over the country. If there were a more fair and less corrupt government in charge, I'm sure there would be more market-led approaches to improve goods and services in areas that will be provided in an economy under normal circumstances.
Right now, since Chad does use interventionist strategies, they may have to wait for a while to see the benefits, since many initiatives that governments lead take years to show positive results. For example, education takes many years to train kids, and then see it applied to their careers and the economy.
I suggest that in the future, if the corrupt government decided to help out the Chadians or if they are overthrown, that Chad take a combined approach. Combining market and interventionist approaches would be beneficial to Chad since it will provide the most range of necessities that the country needs like infrastructure, health care, education, sanitation and trade liberalization. There would be negatives to favoring one side too much. If Chad focused solely on market approaches, goods that created a positive externality would be underallocated, and the tragedy of the commons would befall many of the public goods available. A pure interventionist approach may misallocate resources and stunt the country's natural growth. In the future, if Chad were to focus on its economy and keep creating programs to improve economic growth, economic development will follow soon after and Chad will be on its way to being a developed nation.