chapter  4
18 Pages

Economy and Industry

The chapter begins with two programs related to foreign debt. Two debt management systems, the CS-DRMS developed by the Commonwealth Secretariat and the Debt Monitoring and Financial Analysis System developed by the UN Conference on Trade and Development, provide powerful, inexpensive tools with which ministers of finance can monitor and manage a nation’s foreign debt. Throughout the world, national leaders must work with a public that has only a limited understanding of the dynamics of an economy. The System Dynamics National Model is too complex for teaching applications, and two simplified models have been developed to give students experience with two important modes of economic behavior. In a country like Iceland where there is widespread political participation involving the whole adult population, it is important that many people have a good grasp of the dynamics of the nation’s macroeconomic performance. The model illustrates the dynamic interrelationships among important macroeconomic variables and the functioning of the economy under different conditions.