Monthly Archives: April 2013

What is Demand-Side Economics?

Supply and Demand Cartoon

Supply and Demand Cartoon

As a venture capital firm, Effi Enterprises seeks out emerging businesses that are in need of the funding necessary to grow into a thriving, public company.  These early-stage companies have extreme potential for improvement, but assistance from a firm like Effi Enterprises is all they lack.  In exchange for equity in the company, venture capital firms will invest large amounts of financial capital into the startup to give it the boost necessary to become successful.  In demand-side economic theory, the government must take action to stimulate the economy when it is need and give it the necessary boost for recovery.

Introduction to Demand-Side Economics

Demand-side economics is an economic theory characterized by the idea that economic growth will be created by increasing the demand for goods and services.  Also known as Keynesian economics, demand-side economics strives to stabilize the economy through using government intervention.  To stimulate the economy, demand-side economics suggests the government should lower taxes on the middle and working class and increase government spending.  To prevent inflation, the government should raise taxes and reduce their spending.  Proponents of demand-side theory believe that when the economy is in a recession or economic downturn, the government should step in and take action to stimulate it. Read the rest of this entry

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What is Supply Side Economics?

 

lowering income tax

Taxable Income

Efraim Landa is an entrepreneur that has founded Effi Enterprises to assist early-stage businesses in obtaining the funding and managerial assistance necessary to propel them into a public company in ten years or less.  Effi Enterprises understands the importance of investment and production efficiency to the success of a business and the economy as a whole.  These are the principles that underlie Supply-Side Economics.

Introduction to Supply-Side Economics

Supply-side economics is a macroeconomic theory that emphasizes the importance of increasing the efficiency of production, or supply, as the key to an economy’s potential for long term growth.  It maintains that aggregate supply constitutes the primary driving and stabilizing forces in the economy.  Focusing on alleviating barriers to higher productivity in supply, supporters of this theory advocate for lowering marginal taxes and deregulating heavily regulated industries. Read the rest of this entry

What Drives the Global Economy?

Global Economy and the US

Global Economy

In a time of needed recovery in many countries around the world from the recent economic downturn, many begin to wonder how this recovery can happen.  What is that actually drives an economy and pushes it towards growth and success? What factors need to be focused on to stimulate this recovery quickly?  Individual economies have experienced downturns in the recent years, but as an interconnected global economy, the financial crisis was not enough to stop growth.  To propel the global economy forward, factors such as physical capital, labor, productivity, and investment need to be prioritized.

What is the State of the Global Economy?

The economies of the world are constantly becoming more integrated through trade and investment into one global economy that has grown rapidly over time.  In 1970, the world produced about 12 trillion dollars worth of goods and services and 2010; world production reached 41 trillion dollars.  In four decades, global GDP has increased almost four times.  The pace of the global economy’s growth is gradual and consistent.  Individual nations may experience extreme economic boosts and downturns, but the overall global economy continues a slow uphill movement.  Even after a significant global financial crisis like 2009, there was a dip for that year but global GDP had fully recovered by the next year and even exceeded pre-crisis levels by the year after that Read the rest of this entry

VC market in 2013

 

Mobile Technology

Cellphone

Efraim Landa is a venture capitalist who provides both funding and expertise to emerging companies. A venture capital firm typically works with a startup company that needs funding and support to handle those first turbulent years until they can make an IPO. When a VC firm invests in an emerging company it basically purchases a portion of the company in exchange for a profit that will come as the company matures. It is generally expected that a company will be able to transition from its inception to an IPO inside of 10 years with the average being somewhere around 5 to 7 years. The venture capital firm provides the necessary funds to keep the business running efficiently until the time when a profit can be made. Entrepreneurs and venture capitalists such as Efraim Landa also offer their working expertise to the business to help ensure their successful business venture. Many successful entrepreneurs have stated that the expertise that is gained from experienced businessmen is more valuable than the funding that was secured. Read the rest of this entry