Economic growth is costly, and for it to grow, a country has to let things flow and sacrifice for it. This is to say that countries that need their economy to grow must consider the extent to which they allow growth and development to happen. By this, I mean that an avenue must be made for growth to occur because growth does not happen miraculously. For example, people must work to drive economic growth. Likewise, they must also lessen their regulations to allow growth opportunities.
Based on an article by Greenspan and Wooldridge on capitalism in America, riviewed by Eichengreen (2019), America has to embrace opportunities for growth to happen. It had to embrace and endure creative destruction to allow for innovation and more opportunities for economic growth. It created a list of innovations and accomplishments from the destruction. It means that economic growth and development occur as a result of enduring some pain in the form of sacrificing some time, energy, finances, and senses into developing the future.
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Growth policies and regulations that countries impose should embrace growth and innovation. For example, if a particular government decides to regulate businesses, it should not set policies that will promote innovation. Instead, it should impose those that could hinder innovation, such as ensuring healthy and just competition of organizations. With such a policy, small enterprises have the freedom to engage in business practices without limitations from giant companies. Monopolistic practices are eliminated, allowing organizations to promote economic growth. On the contrary, imposing a policy that makes it expensive for companies to register and start operating would only limit economic growth. If a government imposes such a policy thinking that it is getting more money from the public, it limits economic growth. The registration money for a new company cannot match the revenue tax that the government could get if it allows the company to operate through a small registration fee.
Additionally, technology can do more than just make life easier. It can help accelerate economic growth, as Greenspan and Wooldridge (2018) say. Adopting technology is like creating an avenue for economic growth because doing business and work becomes easy through technology. It increases the utility of work-related activities, providing an opportunity for growth. For instance, small businesses can promote their products nationally through smartphones and the internet, boosting sales and revenue. This revenue is replicated in the economic growth because the business is taxed. It indicates that technology is an avenue for economic development that a country must be willing to adopt. However, adopting new technology is costly; this brings me back to emphasizing my main point that economic growth is costly, and a nation must sacrifice for it to have it.
To sum up, nations need to understand that economic growth requires them to create avenues and opportunities through embracing and enduring creative destruction. This means that they have to step out of their comfort zones and allow for growth through things such as adopting innovative technology. Economic growth cannot happen while they do not create opportunities or avenues for it to grow. From the example of America, it paved the way for economic development through embracing creative destruction, adopting technology, and imposing policies and regulations that promote growth. To enjoy economic growth, a cost must be involved to embrace and endure creative destruction. This means adopting new technology, putting more effort, and revising business policies and regulations.
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Reference Eichengreen, B. (2019). Capitalism in America: A History. By Alan Greenspan and Adrian Wooldridge. New York: Penguin Press, 2018. Pp. 496. $22.48, hardcover. – Keeping At It: The Quest for Sound Money and Good Government. By Paul Volcker with Christine Harper. New York: Public Affairs, 2018. Pp. 304. $18.30, hardcover. The Journal Of Economic History, 79(2), 571-574.https://doi.org/10.1017/s0022050719000251