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If we were looking at a small country that was dependent upon natural resources extraction and other similar capital investments, then a shift in the
If we were looking at a small country that was dependent upon natural resources extraction and other similar capital investments, then a shift in the supply, those natural resource outputs, would likely drive the economy more than consumer demand changes. (the situation in New Caledonia resembles this situation). Even when we look at China versus USA there are substantive differences in what drives the economic. What percent of consumer spending is the GDP? It is much greater in the US versus China and thus we would say that changes in demand curves drive the economy more in US than in China
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