Gross Domestic Product (GDP) is an estimated value of the total worth of a country’s goods production and services, within its geographical boundary, by its local and foreign companies, calculated over the course of one calendar year.
However, for various reasons, GDP omits certain measures of overall economic well-being. There are some limitations of GDP such as the changes in quality and the inclusion of new goods, leisure time and human effort costs, underground economy, economic bads and not including non-market transactions, which may result in the GDP being understated or overstated.
There are 3 ways to compute the country's GDP, the expenditure approach, income approach and the production approach. Expenditure Approach: GDP = C + I + …show more content…
This shows that in order for the economy to recover from the recession and to prosper, the government needs to intervene and implement some policies to ensure that these factors are well taken care of. Also, getting the confidence of people and the businesses on the country's economy is key to Thailand’s …show more content…
The low crude prices in Thailand is able to increase net exports, ensuring that the Thailand's import bill remains low. There is also still room for improvement for the consumer prices. Consumption has been lower than expected for the past year. It has been declining since February last year, which is also lower than the targeted amount. Hence, the government can increase consumption by implementing policies such as lowering taxes. On a brighter note, the number of tourist arrivals have been increasing, giving a boost to the economy. It increased from 15.9% in January up to 18% in the first half of February last year. Hnce, the government can focus more on tourism, in order to ensure an economic growth. With low oil prices, tourism growth and more consumption, the country should be able to recover from recession. Overall, the recovery of Thailand depends on how effective the government policies and actions and confidence of the people and business in Thailand.
There are 3 types of recoveries, namely "V" shape recovery, "U" shape recovery and "W" shape recovery, which occur when the economy declines and rises rapidly, declines and recovers gradually or when the economy declines again shortly after its recovery from the previous recession respectively. With the figures and positive economics presented in these articles, we can infer that the type of economy recovery that is occurring in Thailand is the "U" shape recovery,