The President of Lisavia (a small country) wants to increase productivity in his country.

He has recently become aware of an economic principle that suggests that as a nation's

productivity rises, its income will rise and therefore its standard of living will also rise. You have

just been appointed as the economic advisor for Lisavia. Discuss three economic policies you

might advise the President to pursue in order for his country to achieve this increased standard of

living.

Develop a response that includes examples and evidence to support your ideas, and which clearly

communicates the required message to your audience. Organize your response in a clear and

logical manner as appropriate for the genre of writing. Use well-structured sentences, audience-

appropriate language, and correct conventions of standard American English.

As the economic advisor of Lisavia, it is important for me to begin by addressing the definition

of productivity in our economy. Productivity refers to the aggregate sum of services

manufactured by individual labor units. One of the principles of economics states that a

country’s standard of living is dependent on the country’s potential to produce goods and

services, this motive deduces the fact that increasing productivity will therefore enhance a

country’s standard of living. In order for the President to attain the objective of strengthening our

country’s standard of living, he should focus on education, free trade, and enforcing property

rights and political stability.

In order to achieve this increased standard of living which includes wealth, material goods,

employment opportunities, housing, labor, GDP, inflation rates, etc.… the quality and
obtainability of education becomes a crucial factor. Education refers to the process of giving or

receiving (in this case) systematic instruction. It has been proven that education raises a person’s

wage by approximately 10 percent. An effective way to increase our country’s standard of living

is by providing facilities to promote higher education and to have a variety of schools available

in all areas. For example, if a business man would like to widen his knowledge on how to

communicate with other businesses, maybe an opportunity to attend a workshop that will address

effective ways to communicate and build relations will help his business grow and his

knowledge to expand. A well-educated economist tends to be more open-minded and can

brainstorm ideas and effective ways of producing goods and services. Overall, investing in

physical capital is as important as providing money for human capital because our personal

investments can provide external benefits for education and therefore increase productivity in our

country.

Within the broad spectrum of free trade lie inward-oriented policies which strive to expand

productivity and heighten our country’s living standards. Free trade has no restrictions so when it

comes to things such as clothing, food, electronics, and medical care they are now more

accessible because of international trade systems. A way in which the government can improve

trade relations and make it easier for countries to exchange goods is by constructing several

seaports in our world’s major cities. Although ports are capital intensive facilities, having several

of them in our country will benefit the performance of the port transport chain and increase

seaborne exchanges. To have successful trade, the government has to have stable and predictable

regulations which will open opportunities for not only international trade but for local trade as

well.
Furthermore, economic growth can be promoted by enforcing property rights and political

stability. Property rights allude to the ability for people to have dominance over their own

resources and political stability refers to the integrity of the current government and how they’ll

make positive changes to our country to increase our standard of living. In developed countries,

policymakers are aware that having property rights and improving political stability is going to

help the growth and development of our economy. To better enforce property rights,

policymakers and whomever will work with the President should stay away from advocating

policies that subvert private property because that contradicts the implementation of property

rights in Lisavia. For example, people who hold property rights confront incentives to conserve

their benefits and having ownership of property forces them, in a way, to protect their present

value because they know that their future value is dependent on what they currently have.

Eventually, enforcing all of these tactics will enhance the standard of living in our country,

Lisavia. By having more educational facilities available for all to use, our economy will benefit

because it’ll have a well-educated population that could provide several ideas for economic

growth and development. In addition, having various seaports around the country can accumulate

capital and open opportunities for goods and services to enter the country. The final policy that

can be imposed to create the ideal standard of living in Lisavia is promoting political stability

and having property rights that will do nothing but help the expansion of our economy and

prosperity.