Assessment of Government Activity in the Economy: USA–Germany–Japan–China

Abstract

The main goal of the article is to present diversified roles of government in case of different economies, which nowadays play big role in the global economy. For this purpose, a general concept of the role of government in economy is illustrated, after which the variances and similarities of state interventionism in the United States, Germany, Japan and China are presented. The article presents an evaluation of state activity in the studied countries, using inter alia The Global Competitiveness Report, World Competitiveness Report and Human Development Index. Main research methods are comparative analysis and historical case studies used to present role of government in studied countries. The analysis shows a clear gap between market economies and state capitalism. China is being classified as efficient-driven economy, as opposed to the USA, Germany and Japan, which are classified under innovation-driven economies. China records good score for economic performance, but government and business efficiency are assessed poorly. The greatest challenges for the Chinese economy are: limited access to financing, inflation, policy instability, inefficient government bureaucracy and corruption. Summarizing China accomplishes good results in terms of economic indicators, but the economy is inefficient and doesn’t achieve the social goal of providing a good quality of life.