Who will be the world's most powerful country?

There are few countries in the world capable to grap and shape the future of our world. To achieve this, a country must have a vey large population, a high GDP and a vast and modern army. This is a simple measure of power and influence, and by this three caracteristics, I appoint three countries too: USA, India and China.

If USA is nowadays the most powerful country in the world, because it has the highest GDP and the best army in the world, China has de second highest GDP, the biggest army in soldiers, and the biggest population in the world. But USA's population will decrease in the next decades, as Chinese population too. Only Indian population will increase and like Simon Kuznets said once, the demographic factor is one of the most important factors to justify the economic growth in the world.

USA like China and India are investing a lot in innovation and entrepreneurishp policies, but besides USA are at the world's pole position in this field, China and India are catching up quickly the USA. So, not considering on the growth function the technical progress factor, we saw the population factor as the unique factor capable to justify the internal market dimension, the GDP performance and the army size. And by this analysis, India will be in this century the most powerful country in the world!

Can the Euro Zone colapse?

Imagine that european southwern countries couldn't grow for the next 5 years. Why? Because of the high public debts and high unemployment rate will continue consuming resources. Solution: decrease labour costs and/or increase exports. Easy? Not really! Because to increase exports, firms need to become more competitive and this is a structural measure, which implies more qualified workers or better operating processess, which implies better management policies. And to society achieves better management policies needs several years to management science evolute and to inspire the next generations of millions of managers.

So, what is the the other way? Well, by the devaluation of the currency of course! Ups... Euro management policy is very rigid, so the European Central Bank will prefer to adquire public debt and fill the government safes with liquidity instead of devaluate the european currency! Because if Euro decreases its value compare to other currencies like Dolar or Iene, imports will cost more, mainly food and oil. So yes, the Euro Zone can colapse! And it will colapse unless europeans governments stop to increase their debts and start to reinforce industrial competitiveness.

A fiscal shock will be required. Taxes need to be lower to firms which pursue exports and innovation policies. Taxes need to be lower to those who contribute more to the wealth creation. Just with the right measures we can avoid the colapse of the Euro Zone.

National competitiveness: a dangerous obcession?

Paul Krugman said once that governments shouldn't try to chase competitiveness goals. And why? Because looking to national competitiveness it's simply wrong. Competitiveness is a word usually used in management theory, when we want to define how a firm as a better performance than its rivals. Competitiveness is measured by sales growth, market shares or profit, but can we apply these measures to countries? It is correct to say that the main goal of economic policy is increasing national exports or increasing GDP?

What is the main goal of economic policies? Sure that is not just increasing national exports! But can we talk about national competitiveness as a war between countries to capture world resources like talent people, financial capital or foreign investment?

The World Economic Forum defines national competitiveness as the changing rate in productivity. If productivity increases, a country reinforced its competitiveness. The opposite it's true too. There are other measures when we talk about competitiveness which we can use, but I think that the vision of Paul Krugman is wrong.

Krugman said that talking about national competitiveness is just a political fashion, but I think that Krugman forgets one simple point: countries do compete in global market. And the reason why is because countries are competing not just for human resources or global market share... but they are fighting for survival. Western economies are struggling. The western societies are ageing, and their economies are heavily indebted. Today, the social protection system is a burden to european governments because the lack of young people will stop the funding of one of the most oldest Ponzi schemes in the all world. At european countries, young people fund the social pensions of the oldest ones, which constitutes a severe intra-generational conflict.

So, if countries not pursue a competitiveness goal, how these economies will fight for their own survival? If a nation don't increase its exports, or if economic growth don't happens, people will migrate and every internal markets will colapse. So, it is wrong to talk about national competitiveness? Countries need to pursue better living standards! If they don't... economies will fail. It's the Darwin's natural selection theory applied to economics. Don't you believe in it?

Future Economics - what is?

Nowadays, we are to much focused in the short term. The "short term madness" is driving us to a no way exit. We need to think better on our lives, jobs, firms and our economy. Future Economics born with a single purpose: discover new insights. We need new insights to achieve a better understanding about our lives and world.

Future Economics will focus on the future of our economic system. We need to rethink about poverty, energy supply, environment, development, education, health, innovation and competitiveness. We need new drivers to sustain our economic growth.

Future Economics will provide intelligence about social and economic trends. We will constitute a global network of foresighters to help our global society to understand better our future challenges. So, you're now officialy invited to a new journey! Come and join us!