Tuesday, May 08, 2007

Economics

As the economy progresses we witness the windfall of taxes . In some way or the other the administration wants to get a a pie of what you earn , get or gain.
Recently I read a white paper written by learned professors of some US university . The research was based on rating the countries economy on the standards of people having enough cereals to eat, population control, Birthrate, Fertility rate etc etc.
According to there research its all linked. The research says in Developed economies it is observed the birthrate and death rate are stable and mostly found out that birthrate can descend and death rate too descends . It is commonly fact that in developed economies the health services are much better and the life expectancy is high. But the problem just like what US/UK/Denmark is facing is more and more people of retired age and more is the pressure on pension revenues, state health care system, more pressure on subsidies. I am not stating here that the elderly are too heavy to bear , the idea is indirectly the state bears the pressure and some way increase the taxes.

Developed economy faces this in much later stages in case the population rise is far more than the rate of health care system expansion.
The developed ones are facing the other side of troubles which is taking toll on many state machinery and big corporates we all know about the GM/FORD high rising pension burden stories . taking toll on these companies forcing them to shut many shops.

In some way high taxes in an economy forces people to produce more... earn more... well the fundamentals of this statement is yet to be supported with data but the idea is possible...

it is said that taxes kill business.. but in an ecosystem where taxes are uniform and higher the production and the earning can be pushed to the limits to sustain a living . Any how it is just an idea the pressures of taxes is more visible on developed countries than developing because there is always someway or the other grey area to elope from .
Indian next gen is witnessed to pay higher taxes .. they say it is good to the system , more money flow will generate more employment, better infra...
they are not shy to pay more taxes... this is a surprising fact witnessed here.

Even if India stands low in percapita rice/wheat production in worlds standards but the amount of people involved in its production is higher than many populations of many countries.
and this over engagement on agriculture gives rise to the spillover of employment on other sector for eg. manufacturing and services.This holds good considering the number of people working in developed countries and produce they give on production per acre. the reason here will be given as high class machinery , fine seeds, good fertilisers and pesticides . It holds true but to discuss the labour in this condition is a good idea.. number of people working in agriculture have decreased and gone to other sectors.


this is what will happen in India and so it is not a problem people come to city for jobs this is in fact a good indicator to growing economy.

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