Grecian Formula New Formula Does Not Work

Something that can hardly be ignored is the deep relationship of political stability and favorable economic performance of nations. Political stability provided by strong political institutions, allows the benefits of growth and economic activity reach all social sectors to which requires as a fundamental principle that society adheres to the principles of rule of law, on pain to submit assignments disturbances.

but unknown A striking case is Belgium. A country rich, developed, prosperous heart of the European Union although nonperforming completing 200 days without an elected government and ethnic political divisions more like petty politicians who own the struggle between parties to impose a government project national. While the French-speaking Belgians use their capital to hold together the nascent kingdom, the Flemish, Dutch-speaking, they invent all sorts of gadgets to split populists, who usually are very popular among the grassroots, very perceptive to these kinds of expressions. Such a division between Walloons and Flemings led to the existence of an interim government, responsible for the king, which has limited powers, unable legally to legislate on socio-economic or fiscal measures to promote, in a country with a deficit of 25 billion euros.

And a sign that the political imbalances can be safe routes to greater imbalances in the markets is a warning of the Standard and Poor's to downgrade the debt rating of Belgium. If the interim government can not take economic measures will be necessary in the short term is taken to an elected government able to take such measures before the markets react and take severe retaliation, the style Greek and Irish, so what happens if the political divide persists and uncertainty about the government?

The answer is simple. Belgian debt lose confidence, investors shall be frightening to dispose of their sovereigns, seek out the capital of Belgium, the government will have severe fiscal difficulties that will seek to correct with cuts in social benefits to the Treasury gives its citizens to the expected results : insurrections of the trade unions, strikes and other measures to bring the country made the worst of all worlds. But is it possible that political stability economic stability help?, for a case close enough response, the Colombian sovereign bonds have the highest returns among emerging markets, product markets perspective on the imminence of the investment grade rating to Colombia, and to the perception of political stability that was designed with the change of government in 2010.

The issue of political stability is a matter of respect for democracy. In a liberalized economies concept, why institute a government?, Because the passions of men will not conform to the dictates of reason and justice sin una fuerza coercitiva, en palabras de Hamilton. Pero dicha fuerza coercitiva debe estar desprovista de esas mismas pasiones que busca ajustar al orden.

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Concluyó 2010 en medio de una fuerte expectativa por el incremento del salario mínimo legal en Colombia que, asimilado como un precio muy importante en el mercado, supone un parámetro interesante para el funcionamiento de la economía. Como se vio, el salario tuvo un incremento del 3,4%, ciertamente una tasa de incremento bajísima y que será aún más baja cuando en este mes de enero que inicia se sepa cuál fue la inflación causada durante 2010. Si las expectativas incubadas por productores y consumidores se cumplen, el incremento real del salario mínimo será aún más bajo que el 2%. Además, el salario mínimo sirve de parámetro para definir otros precios, como las multas de tránsito, cuotas de compensación militar, servicios médicos entre otros valores de uso cotidiano. Esto aunado a que antes de finalizar 2010 ya los colombianos sabíamos que otros bienes, como los combustibles, subirían sus precios.

Ante ese panorama podríamos gritar junto a las centrales obreras que el Gobierno se apartó de los trabajadores más pobres y se alineó a los intereses de las clases empresariales que buscan pagar lo menos posible a sus empleados. The answer is yes and no. Entrepreneurs are aware that much of its costs are in wages, the Government is aware that the Colombian economy has many of its bases in households and workers know that this situation precipitated with ease inflationary pressures.

say two things: Colombia, as a girl and emerging economy yet, it fails to sustain its economic performance in a heavy accumulation of capital, in innovation, technological change, but in unskilled labor. Also, given their precarious economic liberalization, domestic demand often determines the pace of growth of GDP, making the country prone to frequent crises, severe contractions, pronounced booms and increases susceptibility untimely manifested in price levels. Colombia produces many commodities and goods of very low added value that makes them susceptible to changes in prices resulting from supply shocks and demand results, for example, foreign capital inflows, often speculative, natural phenomena, relaxation of the rationalization of credit, among others. Hence, raising the minimum wage in a country dependent on domestic demand could boost the economy, yes, but at a cost of inflation suggests that the problem does not dwell on how to vary the minimum wage, but in the very structure of the Colombian economy.

Consider the case of Spain. In 2012, the English labor unions aspire to the minimum wage of workers comes to 800 euros. While the socialist government supports such a possibility, employers still have reservations and scholars are divided. The main argument is that much of the inflationary pressures are viewed as margins come from the business, although consumption in Spain is important and will suffer, of course, to a significant change in family income, structure English economy could ensure that a minimum wage increase does not have the impact it would have in Colombia, in large part because the weight of venture capital is much higher in Spain, as they do have the consumption of enterprises.

Raising the minimum wage by 3, or 10% in Colombia will be needed in the money economy, as shown, generates price increases, often anticipating the implementation of the new salary amount. Will there be any outbreak of inflation, most likely, and expected that the increase in wages is diluted rapidly rising prices. The solution the problem is far from determining a market price mechanism that ignores minimum and maximum, perhaps the answer lies and lies, inter alia, the need to modernize the production structure in Colombia, enabling cost reductions in processes and products and generate an impact real market: more and better products at lower prices in an environment of higher real wages result. Otherwise the minimum wage remains the hope of the poor. And with a minimum wealth hardly reach the poorest.