American Culture, Economy

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Colombian Economy

Economy is the study of the most effective way of managing the scarce resources in a particular geographic region in order to satisfy all the necessities.  The scarce resources in a country are land, labor, capital, goods and services.

In Colombia the government has focused its efforts and many of their resources in the production of coffee, sugar, cotton, corn, rice and many others.  Those products are important in our country because these are the products that represent the highest value in the Gross National Product (GNP).

Colombia has a competitive advantage in all these products; this is because Colombian firms are able to deliver the same benefits as competitors but at a lower cost (cost advantage). This means that we can produce coffee, sugar, corn and rice at a lower cost than the rest of the world.

On the other of the most common problems in Colombia is the labor; there are too much workforce and very few demand for it.  Companies in Colombia are not big enough, so they cannot give employment to all the residents. This is because, the don’t sell products enough, the demand for companies’ product is not enough to increase their production and employ more personnel.