Did you know that the U.S Economy is the world’s third largest economy?
It is also one of the world’s most diversified economies, owing to its world-leading industrial sector.
The U.S economy is said to be a mixed economy where both privately-owned businesses and the government play their respective roles. This means that it while it operates as a free market economy and allows the consumers to have a say in resource allocation, it also runs on the functions of a command economy where government takes the major decisions.
But what exactly is the U.S economy comprised of?
The Key Elements of the U.S Economy
Every economy contains some basic components like land, labor, technology, natural resources, organizations, social institutions, etc, that help it exist and perform. The U.S economy is also made up of these very factors that have helped its mixed economic system to develop remarkably over time.
1. Natural resources
The first important element of the U.S economy is its abundant natural resources. The United States is exceptionally rich in fertile soils and mineral resources that truly help it bind its economic processes together. It is also blessed with widespread coastlines on the Gulf of Mexico, as well as the Pacific and Atlantic oceans. These vast waterway systems in the U.S have significantly helped boost its economic growth over the years, along with its plentiful natural resources.
The second important factor of the U.S economy is of course its labor force that basically helps convert its rich supplies of mineral resources into various goods, which are then exported to other countries.
Throughout the course of its history, the U.S has experienced a solid growth in its labor force which has greatly fueled its economic expansion. Post World War I, much of its labor class comprised of immigrants from Europe who were brought to the U.S as slaves.
In today’s time, human capital is a vital part of the U.S Economy and a gateway to success for its high-technology and modern industries.
3. Managerial Structure
Alongside labor and natural resources, managers play a key role in bringing together the other resources and organizing them as efficiently as possible. The traditional managerial structure in the U.S Economy functions in a top-down manner where the chain of command goes from top to bottom. The authority flows from the chief executive all the way down to the lowest person in the hierarchy, which helps its economy and businesses run with great efficiency and smoothness.
However, in recent times, due to increased global competition, the U.S economy is moving from traditional structures to a more flexible working structure, particularly in high-technology industries.
In the U.S economy, corporations in particular have proved to be a vital asset in terms of accumulating funds to produce goods and services. They help raise necessary capital to launch a new business, or perhaps expand an existing one.
Without these corporations, the U.S economy wouldn’t be able to foster a flow of financial resources to help businesses make well-informed decisions.
While this is just the crux of the U.S economy, in recent times the economy has grown to be more complex where statistics have revealed major changing trends that might just lead to a paradigm shift altogether.