Before taking
any strategic decision managers have to indentify
the pertinent macroeconomic aggregates, the
relations between them and their TRENDS.
| Aggregates |
GDP
= C + I + G + X - M |
| GDP |
total value of final goods
and services produced within a nation
during a given year |
| C |
Household consumption of goods and services |
| I |
physical investment (gross private capital
formation) + additions to inventory |
| G |
Government expenditures |
| X |
Exports |
| M |
Imports |
Three
approaches to calculate GDP
| Approaches |
GDP (Gross Domestic Product) |
| Flow-of-product
approach |
C + I + G + (X
- M) (open
economy) (assumptions
: depreciation = 0, indirect taxes=0) |
| Earnings approach |
Sum of earnings received by household
from firms (wages, rents, interests,
profits) |
| Value-added approach |
GDP = total value added produced by
firms |
Relation
between International Trade & Internal
Macroeconomics
GDP =
C + I + G +( X - M)
GDP -
C - G = S = I + (X - M)
(S - I)
= (X - M)
If X is not equal to M,
that is because S (savings) is not equal
to I. If we want to restore the equilibrium
between X and M, we have to restore
the equilibrium between S and I by using
the three macroeconomic policies :
Macroeconomic
Model for Switzerland (million swiss
francs)
Years |
C |
G |
I |
X |
M |
GDP |
1998 |
238'362 |
44'715 |
87'582 |
160'413 |
141'353 |
389'719 |
1999 |
244'740 |
44'983 |
89'619 |
169'409 |
147'090 |
401'661 |
2000 |
252'675 |
46'810 |
95'627 |
196'168 |
171'621 |
419'659 |
2001 |
260'075 |
49'735 |
94'193 |
197'666 |
176'407 |
425'262 |
2002 |
262'522 |
50'900 |
92'590 |
192'641 |
164'177 |
434'476 |
2003 |
265'891 |
52'252 |
89'824 |
192'802 |
164'040 |
436'728 |
2004 |
272'333 |
53'026 |
93'946 |
209'119 |
178'021 |
450'403 |
2005 |
278'198 |
54'198 |
98'197 |
227'283 |
196'074 |
461'802 |
2006 |
286'376 |
55'223 |
104'407 |
257'516 |
216'988 |
486'533 |
2007 |
296'789 |
56'379 |
112'221 |
293'067 |
239'528 |
518'928 |
2008 |
308'629 |
58'647 |
115'200 |
307'454 |
245'480 |
544'451 |
2009 |
310'459 |
60'649 |
108'176 |
276'637 |
218'064 |
537'856 |
2010 |
316'362 |
60'160 |
103'878 |
295'952 |
230'107 |
546'245 |
Macroeconomic
aggregates for Switzerland : annual variation
rates
Years |
Unemployment
rate |
Inflation rate |
1998 |
3.90 % |
0.00 % |
1999 |
2.70 % |
0.86 % |
2000 |
1.80 % |
1.49 % |
2001 |
1.70 % |
1.05 % |
2002 |
2.50 % |
0.62 % |
2003 |
3.70 % |
0.62 % |
2004 |
3.90 % |
0.82 % |
2005 |
3.80 % |
1.12 % |
2006 |
3.30 % |
1.11 % |
2007 |
2.80 % |
0.70 % |
2008 |
2.60 % |
2.47 % |
2009 |
3.70 % |
- 0.48 % |
2010 |
3.90 % |
0.68 % |
Years |
C |
G |
Invest |
X |
M |
GDP |
|
Annual variation rates |
1999 |
2.68% |
0.60% |
2.33% |
5.61% |
4.06% |
3.06% |
2000 |
3.24% |
4.06% |
6.70% |
15.80% |
16.68% |
4.48% |
2001 |
2.93% |
6.25% |
-1.50% |
0.76% |
2.79% |
1.34% |
2002 |
0.94% |
2.34% |
-1.70% |
-2.54% |
-6.93% |
2.17% |
2003 |
1.28% |
2.66% |
-2.99% |
0.08% |
-0.08% |
0.52% |
2004 |
2.42% |
1.48% |
4.59% |
8.46% |
8.52% |
3.13% |
2005 |
2.15% |
2.21% |
4.53% |
8.69% |
10.14% |
2.53% |
2006 |
2.94% |
1.89% |
6.32% |
13.30% |
10.67% |
5.36% |
2007 |
3.64% |
2.09% |
7.48% |
13.81% |
10.39% |
6.66% |
2008 |
3.99% |
4.02% |
2.66% |
4.91% |
2.48% |
4.92% |
2009 |
0.59% |
3.41% |
-6.10% |
-10.02% |
-11.17% |
-1.21% |
2010 |
1.90% |
0.81% |
-3.97% |
6.98% |
5.52% |
1.56% |
The Global Competitiveness Index 2009–2010 rankings © 2009 World Economic Forum
Switzerland : Number 1
The Global Competitiveness Index 2010–2011 rankings © 2010 World Economic Forum
Switzerland : Number 1
.
Source
: National Bank of Switzerland, Monthly Statistical Bulletin, 2011
© Bernard
Jaquier, Professor in Economics & Finance,
Ecole Hôtelière de Lausanne,
2011
