Comparative Economic System Term Paper Example | Topics and Well Written Essays - 1750 words

Comparative Economic System - Term Paper Example On the contrary the government of North Korea in order to improve the economic system plans and develops strategies and even focuses on its major goal of being prosperous and a strong nation. The North Korean government gives more importance to the foreign investment and considers this to be the tool for improving living standard of the region. However the overriding concern of the government is its political control that is likely to inhibit certain fundamental reforms in the present economic system of the region. According to Gregory & Stuart (2013), the economy of South Korea grew enormously and the structure of the economy has even transformed radically since 1962 with the support of First Five Year Plan of Economic Development. The GNP of the region had expanded by 8% annually. In 1962 GNP of South Korea was US$2.3 billion which increased rapidly and in 1982 it became US$204 billion. The economic growth that rapidly increased however slowed down in the year 1989. In comparison to the previous year, the growth rate was decreased to half and even there was an increase in inflation rate which was associated with rapid increase of wages. In the year 1990, the region even had witnessed a trade deficit and the various forms of developments indicated slowing down of an economy that was rapidly maturing. However the domestic demand of South Korea was increasing that clearly stated that the economic system would be healthy until there is no such political crisis that would create an adverse effect on the economy. The growth of industrialization in the country was majorly due to the adoption of a strategy that was more of outward looking in the year 1960. This strategy proved to be very effective as the natural resource endowment was very poor in this region, the domestic market was small and savings rate was also low. There have been great economic reforms in