Why are some countries very rich and some countries very poor?

Question

Why are some countries very rich and some countries very poor?

Answer 1

This is a question that has plagued Economists for centuries.

The Classical (not classical economics) view was that resources determined a country's wealth. However we then get countries like Zimbabwe and Vietnam that are the Bread Basket of Africa and the Rice Bowl of Asia respectivly, and yet they are very poor. However we also have countries like New Zealand who do well with Agriculture.

Next we could consider Government. This explains why countires such as Vietnam and Zimbabwe don't do so well, but still doesn't completly explain the situation.

The major reason is that rich countries have been rich in the past. Although this doesn't explain why incredibly rich countries like Spain and Venice have fallen (they aren't bad, jiust not as good as they were). However countries that have small sustained growth in weatlh compound over time (like compound interest in a Bank) which result in much larger gains in the long run. However this only partially explains the situation - we are left with the question why did those countries start having these gains to begin with.

Altogether it is a variety of factors that cause this. If you have time read the foreward to P.J. O'Rouke's "Eat the Rich" which gives his view on this question.

Answer 2

Countries' annual GDP and international debt is based on a multitude of factors related directly to economic growth.  Some are factors are simple, such as the productivity per person in relation to population size as well as resource management and development.  Some factors are complex, such as health of the population and international political influence.  More important than the GDP/debt of the nation is the disparity of riches within that nation.  Statistically, the median quality of life is much higher in a nation with little wealth disparity compared to a similar country with same GDP but bigger wealth disparity.

Answer 3

cuz boobie