Economics Commentary - article on the Haitian Earthquake Essay Example for Free

Economics Commentary article on the Haitian Earthquake Essay IN JANUARY last year, the quake causes the 2004 Asian tsunami, which kill 250,000 people and 300,000 injured. People were living under sheeting strung across wooden poles. There were too many vulnerable homeless people that aid agency cant fit them in tens. People are trapped in supermarkets, debris and so on. I feel really sorry for them and I hope casualtys family can be rest in peace. First of all, there will be a change in Haitis economy because theres a huge effect of Haitis production. Haiti lost 250,000 people and 300,000 people were injured. They lost loads of labor and enterprise just because of this. Labor are human resources providing power to make goods and services Enterprise is a firm is an owner of a factory or company e.g. Nike, Apple. Capitals such as Houses, hospitals and factories were destroyed. Capital is man made resources that use for production. Many animals got kill by this earthquake and tsunami and destroyed timbers theres loss of land. Land is natural resources that cant add by human. Clearly, Haitis production is decreasing. In this case, we can use a PPF to explain the situation. PPF is a curve that shows the combinations of 2 or more goods that can be produced using all available resources. Heres the PPF of Haiti before tsunami. PFF1 is Haitis PPF before tsunami and PPF2 is Haitis PPF after tsunami The PPF shift to the left means theres decrease at both actual and potential output. Actual output is what the country is currently producing and potential output is the maximum outputs you can produce will all currently resource. Because Haiti lost a lot of capitals, land, labor and enterprise, its production is running down. Therefore, its PPF shifts inward. Theres also economic decline and economic deterioration. Economic decline is the percent decrease in real GDP per annum and economic deterioration is decrease in living standard for everyone in the country. There is a shift of PPF because of the environment factors (earthquake and tsunami). There was a change of Haiti peoples demand because of the tsunami and earthquake. Demand is amount of a good or service that consumer are will and able to buy at a given price over a period a time. Whats the change of Haiti peoples demand? Tsunami and earthquake destroyed a lot things, one of them is food. Haiti people are in starvation, theres no more flesh food for them so their demand of canned food rose. It is because inferior goods demand if rise when theres war, natural disaster. Inferior good is a good that can replace another good as a substitute. The demand of Haiti peoples canned food This is a demand curve shows people in Haitis demand of canned food rise from D1 to D2. Because the demand determinate is not price of the good of itself, its environment, theres a shift of demand curve to the right. Demand determinants are factors that can affect the demand such as: price, consumer income, and low populations Evolution Haitis earthquake and tsunami are lost and a pain we would never wanted to happen and they took millions of peoples life away and destroyed thousands homes. Here are few solutions I think it might help to raise back the economy of Haiti. First of all is asking UN for help. The United Nations (UN) is an international organization whose stated aims are facilitating cooperation in international law, international security, economic development, social progress, human rights, and achievement of world peace. United nation will usually provided aid and food for refugees. Second is building hospitals and factories. Recovering labor and capital is an important step to get the economy back on track. Education is more important in Haiti than other countries. They need new blood to contribute for the society and thats where education is needed. Good people equal good country.