The Influence Of The Economy: Goods And Services

Student’s Name Professor’s Name Course Date The Influence of the Economy Economy involves all the activity taking place in a country to generate money. The activities include business, agriculture, mining, tourism and financial services. Economy involves the producers and the consumers. Economics is an essential activity in a country as it generates tax and also in some cases, money is not involved, and trade is done as a direct exchange of goods. The most important aspect of the economy in the country is that it is the production and consumption of goods and services which in our case causes money to flow ( Leibenstein,92). Each person requires money for him or her to survive and for this matter, an economy has to be run by an individual and that why people engage in various businesses and agriculture. The more activities are run in the country, the more the state can make a lot of money which assist the government to run its businesses like getting wages of the civil servants, infrastructure and any other activity in the country. A country needs to provide more spaces and security to people who carry out various businesses to enable them to operate their services well as the services go around them. The high economy in a country can bring both positive and negative effect. Let’s look at the negative impact; Fast growth in a country can create negative impact to the economy, for instance, noise pollution and lower air quality arising from air pollution which is mostly from the many upcoming factory and industries in the urban areas. Next, we have increased consumption of de-merit goods which damage social welfare. De-merit goods come in due to the high demand for the goods by the consumers thus the producers tend to lower the quality of their products so that they can produce more goods to generate more money. Also, massive increase in household and factory wastes reduces social welfare and leads to market failure. Growth that leads to environmental damage may lower the rate of growth in a country, for instance, deforestation, loss of natural habitat to create more industries and bio-diversity from the construction of new roads and industrial estates. Growth in the economy may also lead to over-population especially in urban areas as people move to municipal to get jobs from the growing industry and this puts pressure on scarce land and other ...