The
World Economic Forum is an independent organization that has been merely about since the early on 1970s. It's perchance best-known for the annual shindig that it holds inwards Davos, but the organization also puts out a number of reports on aspects of the global economy. The WEF's 2011-2012 Global Competitiveness Report evaluates 142 countries on to a greater extent than than 100 unlike indicators.
Here, I focus on the WEF evaluation of the U.S. economy. Overall, the U.S. economic scheme ranks 5th inwards the WEF's Global Competitiveness Index--behind Switzerland, Singapore, Sweden, in addition to Finland. Clearly this ranking is i of those weighted averages of a lot of stuff, in addition to i tin enhance questions nearly the both private components in addition to weights used. But it's also truthful that when you lot human face at the indicators equally a group, it tells useful story. For the U.S. economy, the story is i of existent in addition to deep strengths inwards areas similar the size of its markets, the flexibility of its task markets, its potential for excogitation in addition to technology, the overall competence of concern management, in addition to its higher educational activity system. It's also a story of existent in addition to deep weaknesses inwards secondary education, making widespread work of web-based in addition to wireless technologies, in addition to macroeconomic problems of likewise picayune saving in addition to likewise much authorities borrowing.
Here's the U.S. story inwards to a greater extent than detail. The WEF groups its 100-plus indicators into 12 "pillars," with the overall U.S. ranking with the 142 countries for that "pillar" shown inwards parenthesis--and in addition to then a few words nearly the underlying components.
Market size (1st of the 142 countries evaluated) Many Americans accept the benefits of our huge domestic economic scheme for granted, but it allows U.S. firms to accept payoff of economies of scale in addition to focus on excogitation in addition to productivity. Firms with smaller markets demand either to operate at a smaller scale, or else pass the fourth dimension in addition to coin to suspension into a number of unusual markets.
Labor Market Efficiency (4) In this category, the U.S. economic scheme gets credit for flexibility inwards hiring in addition to firing, in addition to for beingness an economic scheme with relatively picayune "brain drain"--that is, where highly skilled people desire to work. The professionalism of U.S. management also gets some credit.
Innovation (5) This category emphasizes inquiry institutes, R&D spending, scientists in addition to engineers, patents, in addition to capacity for innovation--all categories where the U.S. ranks with the Blue Planet leaders.
Business sophistication (10) This category includes distribution, marketing, quantity in addition to character of local suppliers, delegating responsibleness inside firms, in addition to clusters of excellence, where the U.S. economic scheme has considerable strengths.
Higher Education in addition to Training (13) From a Blue Planet signal of view, "higher education" includes secondary school--not merely colleges in addition to universities. And hither nosotros laid about to run across some hard issues for the U.S. economy.When it comes to college ("tertiary") enrollment, the U.S. does well. But when it comes to secondary education, in addition to character of math in addition to scientific discipline education, the U.S. slips means downwardly the rankings.
Infrastructure (16) The U.S. doesn't create super-well inwards roads, railroads, ports, or air carry infrastructure. It falls fifty-fifty a picayune lower inwards these rankings inwards the character of its electricity supply. And the U.S. has been a tedious adopter past times Blue Planet standards of mobile band technology, which is sure i of the technologies with the broadest implications for re-structuring our economical in addition to personal interactions inwards the years ahead.
Technological readiness (20) Color me skeptical on this one. Sure, the U.S. ranks depression inwards "Foreign Direct Investment in addition to Technology Transfer," but given the huge U.S. domestic economic scheme in addition to the fact that it's close the forepart border of engineering scientific discipline inwards so many areas, the lower aeroplane of getting engineering scientific discipline from elsewhere doesn't appear all that worrisome. But this listing in i lawsuit to a greater extent than emphasize that when it comes to connectivity in addition to the internet, the U.S. is non at the tip-top of the Blue Planet rankings.
Financial marketplace evolution (22) This lower ranking is in all likelihood a flake misleading, too. Much of this depression ranking is because of difficulties with U.S. banks inwards the aftermath of the housing cost bubble collapse, in addition to is certainly less of a worry inwards 2011 than it was inwards early on 2009. The same with "ease of access to loans." I haven't dug into the fine impress to run across how the WEF ranks "regulation of securities exchanges" or "Legal rights index," but these are subjective in addition to potentially controversial.
Goods marketplace efficiency (24) The overall ranking hither is in all likelihood likewise low, because some of the lower-ranking elements inwards this category aren't equally of import inwards the U.S. economy, with its technological border in addition to its huge domestic market, equally they would live for many other economies: imports/GDP, customs procedures, merchandise barriers, in addition to unusual ownership. But the rankings are flagging the dysfunctional U.S. taxation code, which has likewise many legal loopholes in addition to equally a outcome ends upward imposing higher-than-necessary rates. There are also some strengths inwards this area, similar the grade of local contest in addition to the sophistication of buyers.
Institutions (39) Almost all of the underlying facts inwards this "pillar" are based on an Executive Opinion Survey done past times the World Economic Forum. Thus, the rankings are based on the opinions of that group. This approach is fraught with difficulties: concern people are beingness asked nearly their ain countries, in addition to so comparisons across countries are tricky. Also, some volition work surveys similar this to boost their ain solid reason or to bash others. Personally, I'm non so sure that a concern community which is critical of its politicians is such a bad thing. I'd worry a flake if the concern community felt likewise cozy with the government! But for what it's worth, here's the breakdown.
Health in addition to primary educational activity (42) Again, I mistrust some of these rankings of effects of illness because they stair out responses of executives on a survey nearly how these volition impact their company, non actual measures of costs. thus, for example, a solid reason inwards which concern executives worry to a greater extent than nearly the impact of HIV/AIDS shows upward hither with a lower ranking. But these rankings also present some well-known difficulties of the U.S. inwards damage of baby mortality, life expectancy, in addition to fifty-fifty primary education.
Macroeconomic surround (90)This ranking is based on the real depression aeroplane of U.S. savings, compared with the enormous budget deficits in addition to high levels of accumulated authorities debt. Oddly enough, what saves this ranking from beingness fifty-fifty worse is that the U.S. nonetheless ranked ninth best inwards the Blue Planet for "credit rating" at the fourth dimension these rankings were done. One suspects that special ranking won't last.
Overall, here's the two-paragraph summary nearly the U.S. economic scheme from the WEF report:
"The U.S.A. continues the turn down that began iii years ago, falling i to a greater extent than seat to 5th place. While many structural features conk along to brand its economic scheme extremely productive, a number of escalating weaknesses receive got lowered the US ranking inwards recent years. US companies are highly sophisticated in addition to innovative, supported past times an splendid academy scheme that collaborates admirably with the concern sector inwards R&D. Combined with flexible task markets in addition to the scale opportunities afforded past times the sheer size of its domestic economy—the largest inwards the Blue Planet past times far—these qualities conk along to brand the U.S.A. real competitive. On the other hand, at that topographic point are some weaknesses inwards special areas that receive got deepened since past times assessments. The concern community continues to
live critical toward populace in addition to private institutions (39th). In particular, its trust inwards politicians is non strong (50th), it remains concerned nearly the government’s mightiness to keep arms-length relationships with the private sector (50th), in addition to it considers that the authorities spends its resources relatively wastefully (66th). In comparing with final year, policymaking is assessed equally less transparent
(50th) in addition to rule equally to a greater extent than burdensome (58th).
H5N1 lack of macroeconomic stability continues to live the United States’ greatest surface area of weakness (90th). Over the past times decade, the solid reason has been running repeated financial deficits, leading to burgeoning levels of populace indebtedness that are probable to weigh heavily on the country’s hereafter growth. On a to a greater extent than positive note, afterwards having declined for ii years inwards a row, measures
of financial marketplace evolution are showing a hesitant recovery, improving from 31st final twelvemonth to 22nd overall this twelvemonth inwards that pillar."
I've noted some of my qualms nearly this index. But taken equally a whole, this seems to me a fair-minded broad sketch of the strengths in addition to weaknesses of the U.S. economical situation.
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