Neo

A context of economic stability strengthens the countrys status in the world, increases the value of the national currency and attracts foreign investors. But there should also exist a certain level of flexibility in order to encourage investors to open businesses within the country. Foreign investors need both security but also the promises of adaptability and flexibility, which will help them conduct organizational operations.

Stability should be offered by most industries and sectors, as well as national institutions. Among the sectors which reveal increased importance in offering stability are the financial sector and the banking sector. The financial sector, supervised by the countrys central bank, must be stable as to develop and implement fair financial regulations, maintain an appropriate value of the national currency and reduce inflation. The banking sector has to be stable as to offer numerous credit and savings opportunities for entrepreneurs.

References

Benito, C.A., Neo-Classical Growth Model, Development Economics Sonoma State University, retrieved from www.sonoma.edu/users/b/benito/econ403/units/NeoClassical.ppton February 7, 2008

Elbaum, B., Lazonick, W., 1984, the Decline of the British Economy: An Institutional Perspective, the Journal of Economic History, Volume 44, Number 2

Gourvish, T., 2000, Entrepreneurship in Britain 1870-1914 – Failure or Adaptation, London School of Economics, Retrieved at http://www.dieboldinstitute.org/paper3b.pdfon February 7, 2008

Meade, J.E., 1962, a Neoclassical Theory of Economic Growth, Retrieved at http://www.economyprofessor.com/economictheories/neo-classical-growth-theory.phpon February 7, 2008

2008, Definition of Neoclassical Growth Model, Econterms, retrieved at http://economics.about.com/cs/economicsglossary/g/neoclassical_g.htm. On February 7, 2008

Neoclassical Growth, CEPA Newschool, Retrieved at http://cepa.newschool.edu/het/essays/growth/neoclass/solowcont.htm. On February 7, 2008.

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