Discuss the key stylized facts we have covered in Chapter 2 about the U.S. economy! What in your
opinion was the most surprising fact you learned about the U.S. economy? Why?
The US economy is much more sophisticated and intricate than I originally believed it to be. I
was aware of how the US was relatively a closed market although they do facilitate some trades, but the
way it was described and explained via the textbook and Professor Guttmann was not how I anticipated
the economy to work. It was stated that in 2017 the US annual exports were over $2.3 trillion while the
annual imports were around $2.9 trillion and this fact at first made me think to myself “How can the US
be considered a ‘relatively’ closed economy” when they continue to trade with multiple countries year
after year. Countries like China, Canada, Mexico, Israel, etc. have all been trading with the US as they are
the world’s largest services exporter. At the time I failed to realize what a countries GDP consists of first,
but once Professor Guttmann had said that the US is the highest consumer spending market it all clicked.
Watching shows like Shark tank or even following up on entrepreneurial businesses had really assisted
me in better understanding and identifying parts of the US economy. I genuinely didn’t realize how the
US is one of the only countries where entrepreneurship is more accessible. Most new ventures tend to be
service businesses as the US economy is a service economy. The US being a consumer spending market
that thrives from services perfectly does line up with the fact that we are a relatively closed economy.
Although we have such high volumes of trade, it does not make up a large percentage of our GDP as
personal consumption makes up roughly 70% of our GDP.
As I grew up, I witnessed the effects of unemployment and the various outcomes that came with
it, especially after 2007. I had several family members who were laid off, or looking for a job, or had to
sell their business due to the financial crisis. To learn that half the workforce has declining wages was
surprising to me due to the wages that New York State has held as standard. I remember when minimum
wage was around $8, but now in New York City it is $15, almost double the amount a few years prior.
Unfortunately, this only applies to New York, as the Federal wage is still extremely low for the rest of the
country. A country made of immigrants, who make up most of the labor force, doing most of the work to
earn company wages are getting the thinnest crumbs possible from the employer. Not to mention how
Discuss the key stylized facts we have covered in Chapter 2 about the U.S. economy! What in your
opinion was the most surprising fact you learned about the U.S. economy? Why?
inflation has changed the value of the dollar tremendously throughout the last few years, which is another
reason to increase the federal wage. In addition to that, social wage is also extremely poor in our country.
With all that has happened within the economy and world within the last 2 decades, I would expect the
US Government to catch up with the rest of the world in terms of wages, social services, and healthcare.
Universal healthcare along with other social services are much more attainable internationally compared
to the US. I would say that although we lead the world in certain aspects, we severely trail some countries
when it comes to universal rights which I found surprising.
Overall, the most surprising fact that I had learned was how intricate and complex the US
economy is compared to other ones. The US economy is unlike others as it has so many different
characteristics and factors that combine elements of other economies. Or the way how the US economy
does not behave like others, due to its hybrid traits and components. Along with this, coming to find out
how our economy is “relatively” closed was very surprising as well as fascinating to me. Being regarded
as the largest exporter of goods in the world, but not having it be a substantial amount of your GDP
boggled my mind for a bit until learning about the personal consumption percentage that makes up our
GDP.