Global Political Economy : Evolution and Dynamics

The article provides national accounts by taking into the consideration of potential GNP in order to measure the gap amid the real and potential GNP (Ansari, 2013).

It also studies the sources concerning the economic growth in terms of the physical quantity of the resources used with increasing number of people and volume of capital employed.

The article outlines the uses and application, which is indented to outline the statistical data, explanation and structural changes, which have been incorporated in the study of the National Income and Expenditure Accounts. On the other hand, the other article reviews the national income and national wealth estimation in Canada. Thus, the article clearly illustrates that the Canadian National Accounts systematically describes the sources, methodology and concepts concerning the national accounts, income and expenditure along with the subsequent issues. Simon Goldberg performed a detailed analysis in his article by underlying the fundamental principles found in the national accounts and specifically estimated the national income and gross national product in a convenient and meaningful manner.

The study provided by him lead to wide acceptance by businessperson, labour leaders, economists, Member of Parliament, the government and others. Apart from the types of economic data, a considerable amount of statistics was also pooled to examine the administrative functions (Broadberry & Klein, 2012). Import statistics were recorded on an annual basis by various colonial administrations in collaboration with the collection of custom duties. The study provided that the export statistics with an indication of the destination of Canadian produce abroad. In addition to this, the impact created by export on economic growth and industrial diversification of Canada were best reflector of economic activity.

The article reviews the central concepts underlying the national income and expenditure accounts. It illustrates the general principle concerning the economic view relating to the factors of production, income arising from the factors of production, formation of capital and savings forms the basis of literature of economics. The gross national product in Canada increased around 1972716 CAD millions in the second quarter of 2016 from 1968996 CAD million in the first quarter of 2016. The article provided that Canada earlier averaged around 1059546.37 CAD million during 1981, however in 2016 it reached an all time  high of 1972716 CAD million in the second quarter and dipped a record low of 343908 CAD million in the first quarter of 1981 (Khader et al., 2014). The data is based on the total value of goods produced and services rendered by the resident of Canada at market price. The current economic performance measures the performance of the economy by keeping detailed information on changes occurred in growth of output, pattern of income flows with strength and structure of demand. The geographical distribution of personal and incomes, which are disposable in other major regions, also forms the feature of the economic system with regional breakdowns of the national accounts average are in high demand (Sahni & Singh, 2014).

The article provides that vital alterations have occurred in the structure of economy over the post war phase. During the year 1946, the income from agriculture accounted approximately 11% of the domestic production and national income with only 25% of the overall employment in Canada (O'brien & Williams, 2016). However, by the early 1970, the agricultural share in the domestic production dropped considerably to 2% and consequently the employment share dropped to 6%. However, during the same span of time, production in service industries increased from 50% of the total production to approximately 60%, whereas the service industry also experienced a growth in total employment of approximately to 60% from previous figures of 40%.

The subject of national income has been common phenomenon and as a matter of interest the article clearly states that the personal spending towards consumer goods and service has sharply degraded. The share of Gross National Product and government spending on goods and services has considerably increased with Canadians opting to distribute high amount of the output to collective consumption. The role of government sector towards economic expansion has amplified to several folds post war period with total revenues of government rising from 24% of the Gross National Product in 1950 to 37 during 1972 (Robinson et al., 2016). The prospect of looking into the problems of economy in quantitative terms is overall magnitude of reporting a nation’s financial health.

The supposed conflict amid the self-interest and social interest is considered as the hottest debated problems in economic contest. From an economic perspective, it is concerned with allocations of scarce resources of society, role of hedge funds, investment banking etc. Whereas the social policy potentially looks into the enrichment of corruptions, side effects of attaining societies agreed social and environmental goals. Aligning self-interest with social interest could lead to huge benefits in the long-run as coalition of motivated investors with self interest of attaining society goals efficiently would ultimately benefit with reduced tax rates and higher incidence of profitability.

Reference List:

Ansari, M.I., 2013. Testing the relationship between government expenditure and national income in Canada, employing Granger causality and cointegration analysis. Managerial finance, 19(7), pp.31-46.

Broadberry, S. & Klein, A., 2012. Aggregate and per capita GDP in Europe, 1870–2000: continental, regional and national data with changing boundaries. Scandinavian Economic History Review, 60(1), pp.79-107.

Khader, S., Rajan, R., & Sen, M. (2014). Macro-Economic Factors Affecting Ease of Business.

O'brien, R. & Williams, M., 2016. Global political economy: Evolution and dynamics. Palgrave Macmillan.

Robinson, L.A., Hammitt, J.K., Chang, A.Y. & Resch, S., 2016. Understanding and improving the one and three times GDP per capita cost-effectiveness thresholds. Health Policy and Planning, p.czw096.      

Sahni, B. S., & Singh, B. (2014). On the causal directions between national income and government expenditure in Canada. Public Finance= Finances publiques, 39(3), 359-93.