Making a formula for calculating expenditure multiplicator in the conditions of non-zero export (ABSTRACT)

Bakur Gogua

Growth of state purchases is more risky for highly-developed countries (e.g. USA), moreover, if a trade partner-country (e.g. Japan) has mobile production means.

The existence of unemployment in highly-developed countries such as the US and Japan, being an economic insurance against possible external negative effects, is stipulated by this very fact (we do not mean natural level of unemployment). It is not because the countries can not provide jobs for the whole population at the natural level. Developing countries have possibilities for reaching economic progress by increasing state purchases. We should mention such countries as Russia, China, India, Brazil, etc. These countries (especially, Russia that has good scientific-technical staff) have very mobile labour force, land, capital (in particular, Russia, China, India) and production technologies (or they might purchase them from highly-developed countries). As mentioned above, the problem of developed countries in the short run is that they can not buy new technologies from other countries if they themselves do not introduce them, which positions their economy at an appropriate level on vertical point or very elastic intermittent point of Keinz’s supply curve (that is very much evaded by highly-developed countries). Their economies can correspond to factually vertical or very elastic intermittent point of Keinz’s supply curve, which enables the countries to reach fast growth rates without increasing prices and deteriorating tax balance. Therefore, paradoxically as it might seem, from the viewpoint of economic growth rates developing countries have more advantageous position in the short run (we mainly mean major countries) as compared to highly-developed countries.