The Current Crisis Sheds More Light on Macroeconomics than vice-versa Essay

The Current Crisis Sheds More Light on Macroeconomics than vice-versa - Essay Example On a personal stand, it would be said that indeed the current crisis sheds more light on macroeconomics and that the various macroeconomic conditions practiced across the globe could greatly be attributed to why the global economic state has not seen any impressive growth over the few years. Indeed, instead of amassing the overall aim of instituting various macroeconomic policies to alleviate poverty and make the economic conditions of countries and its populaces better, certain critical misplaced priorities and mismanagement on the part of regulators of macroeconomic conditions have led to a total failure of the ambition. Today, the whole world seems to be in a shamble and economists continues to argue on which line of action is the best – whether macroeconomic conditioning or microeconomic conditioning. In the following text, specific macroeconomic condition, the roles they were expected to play in influencing global economic growth, and how they have failed and created cris is will be looked at. Again, specific contributing factors to why dependence on macroeconomics could not help but led to global economic crisis will be discussed. Finally, recommendations shall be made on how to revive the crisis through macroeconomics. Assessing Specific Macroeconomic Conditions and how they relate to Economic Crisis National Output and Income The output and input of a country is a major indication of the performance of the country economically. Given any period of time; mostly over one year, each nation produces certain about of viable product. Some of these viable products are goods whereas others are services. To find the national output of a particular country, the total production of viable products is summed up. The reason for using the national output to determine the macroeconomic performance of a country is the reason that the viable products, be they goods or services are considered to be tradable products that can yield the country economic income and re venue. National output is therefore considered to be an economic value. In light of this, Riley (2006) posits that the national output can be used to determine the value added to the economy of a particular country. He defines value added as â€Å"the increase in the value of a product at each successive stage of the production process.† This is where the need for using the national output to create wealth and thus alleviate a country from economic crisis and hardships come in. This assertion is made against the backdrop that the value added is expected to improve all aspects of a country’s production process and thus make the economic lives of the citizenry at all levels better. It is for this reason that the value added and national output are used to determine the gross domestic product of a nation. Again, the national output is closely related to national income because it is expected that the production rate and production proceeds of a country would determine how much the country will earn on the global economic market. For each sale made, there is an added income to the national economic coffers. This is one reason why the national output is easily used to determine the gross domestic product of a country. According to Riley (2006),†this measure of GDP adds together the value of output produced by each of the productive sectors in the economy using