Countries are often classified as developed or emerging. Developed countries are usually older with slower growing economies, while emerging countries are new countries with more rapidly developing economies. One would think the U.S. would be classified as a developed country. But one prominent investment analyst said the U.S. today is more like an emerging country. Why? N.C. State University economist Mike Walden responds.
“Really you should view that statement in a positive way. Traditionally, the U.S. has been considered a developed country along with, for example, most of Western Europe and Japan.
But this analyst said that today things have changed. If you look at the U.S. compared, for example, to Western Europe and Japan, we have an expanding population. Those areas have increasing population. We have much more innovation. We have lower taxes. We have businesses and industries that are increasingly looking to come to the U.S. We have a much improved trade situation.
So this analyst said if you look at those facts alone, it makes the U.S. look more like an emerging economy rather than a developed economy. And they would argue, again, that this is good because we have those growth aspects associated with an emerging economy.
Yet we also have a much higher standard of living that’s traditionally associated with developing countries. Of course, people have reason to disagree and certainly we should analyze these comments very clearly, but this analyst, I think, is giving us reasons to be optimistic about the economic future. If indeed, U.S. fundamentals are looking much better than our sister countries and, say Asia and Europe, then, indeed, that is reason for optimism.”