United State’s Gross Domestic Product
There has been a lot of debate on the future of United State’s Gross Domestic Product growth rate. To many, Gross Domestic Product has gone beyond repair. Going by the previous economical estimates, it is true that the country has been experiencing reduced Gross Domestic Product. However, there are signs that United State is on the path to increase its GDP.
Despite the fact that the country has gone through recessions in the past, I am beyond reasonable doubt that the country is recovering. As you all know, Gross Domestic Product growth has been going up and down. The prediction of the growth of GDP in United State is promising. However, achievement of economic growth will not be realized within a day in future (Howitt, 2007). Although the rate of economy is growth at a very low rate, I am optimistic that with the use of the right measures, we are likely to raise our Gross Domestic Product.
Previously, economists have estimated a 1.9% growth on the third quarter GDP of 2010. According to statistics from Bureau of Economic Analysis (BEA), the Gross Domestic Product rose from 0.8 % in the first two quarters in 2011 to 2.5 % in the third quarter of the same year. This is a positive indication that the economy can experience positive growth if the right measures will be taken.
GPD is determined through the following methods: firstly, through the estimation of individual industries gross output subtracted from the intermediate inputs from other industries. These results in derivation of residual value added for each industry which defines the production approach. Secondly, GDP is determined through the measures of income earnedby different factors involved in production (Howitt, 2007). The third method is the expenditure approach. This shows the level of spending across various sectors in the economy. This is usually done annually.
Although there have been higher forecasts of Gross Domestic products in United States, economists have been cautious on the expected future growth (Gerald, 2005). Financial meltdown is likely to interfere with the economic growth in the state. However, this can be controlled by regulating the European sovereign debt which is the main cause of these financial crises (Howitt, 2007). Growth domestic product is likely to slow down in its growth. For instance, economists have estimated that the growth is likely to fluctuate. However, I believe that economic growth at 2% or above is better than a negating growth.
This is an indication that there is a continuous growth in United State’s labor markets. Some of the major factors that are likely to slow down the economic growth in the future are hiring, income as well as housing (Gerald, 2005).. These are likely to have negative impacts on the general growth of the economy. Financial crises in international markets have affected imports and exports restricting economic growth. There are industries that have benefited from the growth of industries and sectors in other countries such as china, India and Brazil and Indonesia.
These firms are likely to experience continuous growth in the near future. There has been a notable expansion of the emerging markets that acts as a boost to the overall Gross Domestic Product. However, problems in Europe which is major player in intternational market are also likely to affect economic growth in United States. On the other hand, economic growth in the future is likely to be facilitated by the growth in technology such as in mobile communications as well as in wireless internet. There are several companies in United States that have ventured their expertise and skills in engineering and making this sector a major contributor in the growth of the economy.
Notably, companies have had an increased value of goods in their warehouse and stores. This indicates that there is a noticeable growth in the industries that are major players in economic growth. In the past, residential investment has fallen by about 10.9 percent. This is due to the fact that housing sector continues to decline in its growth.
This raises the questions as to whether housing can be viewed as a way of sufficiently adding to the growth of the economy. As earlier stated, there has been a major economy recession that has resulted in increased government expenditure (Gerald, 2005). This has caused a significant damage to the economy. There has been a loss of wealth both in the housing market as well as in labor market. This is likely to continue if the right measures are not taken to relinquish the after effects.In conclusion, expected United State’s growth in future is likely to be harbored by various factors taking into consideration the prevailing circumstances such as decline in the value of dollar.
Industries that have taken the advantage of other developing countries are likely flourish in terms of growth. Thus, a slow but a promising economic growth is likely to be realized which might be an alteration of growth and fall of GDP with time.