How An Economy Grows And Why It Crashes [IV]

There are a number of issues as the island economy develops, including “fish inflation,” or inflation, and the expansion of the money supply. According to the government numbers in the book, economic success and a high employment rate will inevitably lead to this. But when prices increased, the economy grew slowly and the jobless rate increased as well. In reality, however, moderate inflation encourages economic growth while deflation or excessive inflation can lead to a recession or even a financial crisis.

The Islanders have also created administrative incentive programs. By treating surplus goods as private property, we can increase productivity, pique producers’ interest, boost the island’s savings, and open doors for the growth of industry, services, and other sectors. At the same time, it encourages fishermen to purchase fishing nets, boosts consumption, and aids in the island’s economic development.

Real estate: rising slum rents
People borrow money from the bank and make a down payment to purchase a place to live. House prices increased as a result of the growth of linked sectors, which were fueled by student and housing loans and attracted additional capital and manufacturing capacity. House purchases have also evolved into investment practices. Another fear is that the foam will grow and burst due to rising home values.