Economic Analysis Brazil and Bahrain

Analyzing Economic Aspects Between Bahrain And Brazil
Introduction
In delineation, an economic indicator is a component of economic data, more often than not of macroeconomic magnitude, that is employed by analysts to construe prevailing or impending investment prospect or to evaluate the overall health of an economy. It becomes possible to ascertain the performance of a certain economy with respect to these metrics and also make a comparison between two or more nations. These economic indicators are fundamental statistics that show the direction and course of an economy (Investopedia, 2018). The main purpose of this paper is to conduct an analysis of economic indicators of the economies of Bahrain and Brazil.
Trends of GDP
The gross domestic product (GDP) is one of the fundamental indicators that are employed to make an assessment of the health of a nation’s economy. It signifies the overall dollar valuation of all the goods and services that are manufactured or produced in the course of a specific period of time. More often than not, the GDP is deemed to be the size of the economy (Stengel, 2011).
GDP Growth (annual %)
The chart above illustrates the economic growth rate of Bahrain and Brazil between 1990 and 2015. It delineates the rate at which the nations’ gross domestic product has changed and grown from one year to the other over the past two and a half decades. As can be noted in the chart above, the GDP growth rate of Bahrain over the course of time has been relatively greater compared to that of Brazil. In fact, between 2000 and 2015, it is only in 2010 and 2011 where it is perceptible that Brazil’s GDP growth rate was greater. The inference of this is in the past decade the rate of growth of the market value of all the goods and services that are produced in Bahrain has been considerably greater compared to that of Brazil. It can also be noted that for the past five years, the GDP growth rate of Brazil has been going through a downward trend from 7% to -3.5%. In contrast, the GDP growth rate of Bahrain has been on a relatively upward trend rising from 1.9% in 2011 to 5.4% in 2013.
GDP Current ($)
The graph above the current value of the GDP of both Brazil and Bahrain valued in US$ for the past 16 years between 2000 and 2016. In delineation, Gross domestic product (GDP) at current prices takes into account the GDP at prices of the-prevailing reporting period. In other words, this can simply be defined as the market value of commodities that are manufactured and produced in a country in the course of a year. Gross domestic product (GDP) at current prices is also referred to as nominal GDP. One of the key perceptible aspects that can be noted is that despite the fact that Bahrain has had a relatively greater GDP growth rate than Brazil in the past few years, the value of Brazil, the value of GDP in US dollars for the latter has been more than 15 times the size of Bahrain in the past 6 years.
GDP Constant
Another GDP trend that is analyzed is GDP at constant prices. In delineation this is a measure of the economy that is adjusted for inflation and mirrors the value of all goods and services manufactured and produced by a nation’s economy in a certain year. In this regard, the base-year price for both of these nations is 2010. As illustrated in the chart above, for the past 15 years, the GDP at constant prices of Brazil has been significantly larger as compared to that of Bahrain. In fact, the GDP at constant prices of Brazil has been gradually increasing surpassing that of Bahrain from 15 times to over 20 times its size. The inference of this is that the purchasing power of the Brazilian economy together with growth is significantly greater over time. Furthermore, it implies that the economic output of Brazil has been much higher compared to the output produced in Brazil.
Unemployment
The national unemployment rate is delineated as the proportion of unemployed workers in relation to the total labor force. It is largely acknowledged as a fundamental indicator of the performance of the labor market. Unemployment significantly impacts the economy as a whole for the reason that when workers lack employment, their households end up losing the potential wages they would have earned and the nation in its entirety loses their contribution to the economy with respect to the goods or services that would have been manufactured and produced (Picardo, 2018). Within a decade the unemployment rate of Brazil was slashed by almost half. In the past three years, it can be perceived that the unemployment rate in Brazil has doubled ranging from 6.8% in 2014 to 13.4% in 2017. There is a lack of extensive data on unemployment for Bahrain, However, the data obtained for the nation indicated that between 2007 and 2012, the total unemployment rate of the country in relation to the total labor force deteriorated from just over 5 percent to 1 percent. This is linked to the poor performance of the economy during the financial crisis of 2008 that had an adverse impact on several economies. Subsequently, the rate of employment considerably diminished during this period of time.
Government Spending
Government spending or government expenditure takes into account all of the government consumption, level of investment, together with transfer payments. Increased financial spending is purposed to stimulate the growth of an economy. Nonetheless, it is imperative to note that severe government expenditure can result in serious budget deficits and also amass sovereign debt, which can have a detrimental impact on the economy. One of the perceptible aspects from the illustrations above is that the government spending of both Bahrain and Brazil has gradually increased over the years. It can be deemed the main objective of this has been to facilitate the stimulation of the two economies so as to guarantee a higher GDP growth rate. In accordance to Statista (2018), the government spending level in Brazil in the 2017 fiscal year amount to approximately 38 percent of the GDP. On the other hand, Government Spending in Bahrain reduced to 1.833 BHD billion in 2016 from 1.844 BHD billion in 2015 (Trading Economics, 2018).
Exports and Imports
The significant role of exports and imports within the economy of a nation or region cannot be overstated. It is imperative to note that imports and exports play a pivotal role in making an ascertainment of the trade balance of a nation. On the one hand, the exports within the economy are perceived as a driving force of both social and economic development owing to their capability to impact both the growth of the economy and also diminish the level of poverty. On the other hand, imports are perceived as a significant channel for external knowledge and technology to enter into the local economy (Bakari and Mabrouki, 2016).
The illustration above indicates that the volume of exports for Brazil is considerably greater as compared to that of Bahrain. Notably, the value of the nation is almost more than 15 times greater. This can be linked to the huge population in Brazil which is in demand of a greater range of products and services in comparison to the populace in Bahrain.
Labor Market / Earnings, Labor Force Participation, Percentage or Labor Force Tendencies
The total labor force of an economy takes into account the total number of individual working in the nation. As indicated in the diagram below, the total labor force of Brazil has been comprehensively and substantially greater compared to Bahrain. Statistics indicate that labor force of Brazil increased from 80,000,000 people in 2000 to 150,000,000 people in 2017. On the other hand, the labor force of Bahrain increased from 305,000 people in 2000 to 864,000 people in 2017. One of the key reasons why Brazil has a greater workforce is linked to the fact that the country is considerably larger in size compared to Bahrain and also has a greater population in general. Notably, Brazil has a population of just over 207 million people whereas Bahrain has a population of 1.425 million people.
The labor force participation rate can be delineated as an economic measure of the active proportion of the labor force within an economy. It takes into account the number of individual who are either employed or are presently seeking for work and job opportunities. This is a significant economic indicator for the reason that it is utilized in the analysis of unemployment data for the reason that it mirrors the number of individuals that are keen on participating in the labor force (Bowen and Finegan, 2015). The chart below illustrates the labor force of Bahrain and Brazil in terms of the percentage of the total population between the ages of 15 and 64 years as modeled by the International Labour Organization. As indicated by the data, between 2000 and 2007, Bahrain has a greater labor force participation rate than Brazil. However, from 2008 up until 2017, the labor force participation rate of Brazil significant grew and has since then considerably surpassed that of Bahrain. For instance, in the 2016 and 2017 fiscal years, the labor force participation rates of Brazil were 73.3% and 73.6% respectively whereas those of Bahrain were 96.8% and 69.82% respectively. The inference of this is that Brazil presently has a greater number of people employed or looking for employment compared to Bahrain.
The chart below illustrates that the labor force participation rate, with respect to the percentage of the male population between the ages of 15 and 64 years. In general, the male labor force participation rate of Bahrain has been substantially greater compared to that of Brazil. Over the past 17 years, the male labor force participation rate of Brazil has gradually deteriorated. For instance, in 2010, the rate for Brazil was 82.2% and this figure has since then decline to 80.4% in 2017. This is largely linked to the fact that the population of the nation has had a progressively ageing labor force. On the other hand, for the past seven years, the male labor force participation rate of Bahrain has been at a high rate of 88%.
The chart below illustrates that the labor force participation rate, with respect to the percentage of the female population between the ages of 15 and 64 years. In general, the female labor force participation rate of Brail has been substantially greater compared to that of Bahrain. Over the past 17 years, the female labor force participation rate of Bahrain has gradually increased from 35% in 2000 to almost 45% in 2017. On the other hand, the female labor force participation rate of Brazil has remained relatively high with a rate of 54% in 2000 to a rate of 59% in 2017. This is largely linked to the fact that the population of the nation has a high population rate and at the same time is becoming more progressive compared to Bahrain in that women are permitted to work and advance their careers in different professions.

Price Index
Inflation measured by the consumer price index is delineated as the change in the prices of a basket of goods as well as services that are characteristically purchased by distinctive groups of households. A consumer price index is approximated as a sequence of summary measures of the proportional change from one period to another in the prices of a predetermined set of consumer goods and services of constant quantity and features, bought, utilized or paid for by the reference population. The construction of every summary measure is done as weighted average of a huge number of basic summative indices. In addition, each of the basic summative indices is approximated through the use of a sample of prices for a delineated set of goods and services attained in, or by residents of, a particular expanse from a certain set of outlets or other sources of consumption goods and services (OECD, 2018).
Inflation
Inflation takes into account the continued rise in the prices of goods and services from one year to another, giving rise to the deterioration in the purchasing power of a nation’s currency. Some of the underlying causes of inflation comprise of fast-paced increases in the general demand greater than the increases in the supply of output. There is also the rises in the costs of production in the sense that greater costs of production push the prices of commodities sold. From an economic perspective, high rates of inflation can have different effects on both businesses and households, for instance, a deterioration in purchasing power, which causes an inefficacy in the money value system of an economy (Khouri, 2016).
The inflation rates of both countries have been relatively different. At the start of the century, Bahrain has an excessively high rate of inflation standing at 30%. This is indicative of the high price rates of within the nation. In the following year in 2001, there was a deflation rate of 3.3%. Bahrain also experienced deflation in 2009, 2014 and 2015 as well with rates of 12%, 1%, and 9% respectively. This was largely owing to the significant deterioration of the price of commodities in Bahrain as a result of a high rate of supply compared to the low demand of commodities linked to a reduction of both consumer spending and money in the market. On the other hand, the inflation rates of Brazil for the past decade between 2006 and 2016 have ranged between 6% and 8%. In as much as the inflation rate has been steady, the company is experiencing more problems with inflation in comparison to Bahrain.






References
Bakari, S., & Mabrouki, M. (2016). The Relationship among Exports, Imports and Economic Growth in Turkey. MRPA.
Bowen, W. G., & Finegan, T. A. (2015). The economics of labor force participation. Princeton: Princeton University Press.
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Khouri, B. (2016). Economic indicators: Inflation. Wise Owl. Retrieved from: https://www.wise-owl.com/investment-education/economic-indicators-inflation
OECD. (2018). Inflation (CPI). Retrieved from: https://data.oecd.org/price/inflation-cpi.htm
Picardo, E. (2018). How The Unemployment Rate Affects Everybody. Investopedia. Retrieved from: https://www.investopedia.com/articles/economics/10/unemployment-rate-get-real.asp
Stengel, D. N. (2011). Working with Economic Indicators: Interpretation and Sources. Business Expert Press.
Trading Economics. (2018). Bahrain Government Spending. Retrieved from: https://tradingeconomics.com/bahrain/government-spending
Trading Economics. (2018). Brazil Government Spending. Retrieved from: https://tradingeconomics.com/brazil/government-spending