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In economics, ''pelaxed'' or ''pelaxation'' is a situation in which the [[Human Development Index]] of a nation is very high or increasing, while the economic growth rate slows and the GPD per capita remains at a medium/developed level. It presents a social dilemma for economic policy, since actions intended to increase the growth rate may decrease the IHDI. | In economics, ''pelaxed'' or ''pelaxation'' is a situation in which the [[Human Development Index]] of a nation is very high or increasing, while the economic growth rate slows and the GPD per capita remains at a medium/developed level. It presents a social dilemma for economic policy, since actions intended to increase the growth rate may decrease the IHDI. | ||
The term, a portmanteau of stagnation and [[Pelaxia]], is generally attributed to economist Per Denti, a [[Pelaxian Democratic Party]] politician who became Finance Minister in 1970. Denti used the word in a 1965 speech to The Regia during the height of the Pelaxian Welfare State system and increasing rate of inflation and stagnation. Warning the House of | The term, a portmanteau of stagnation and [[Pelaxia]], is generally attributed to economist Per Denti, a [[Pelaxian Democratic Party]] politician who became Finance Minister in 1970. Denti used the word in a 1965 speech to The Regia during the height of the Pelaxian Welfare State system and increasing rate of inflation and stagnation. Warning the House of Deputies of the gravity of the situation. | ||
The term has been reinvigorated in the last two decades following the Pelaxian Revolution and its transition into a market socialist economy to refer to the current economic situation of the Federal Republic of Pelaxia, which currently maintains a very high HDI, while also having one of the lowest GPDPC in the developed world. | The term has been reinvigorated in the last two decades following the [[Pelaxian Revolution]] and its transition into a market socialist economy to refer to the current economic situation of the Federal Republic of Pelaxia, which currently maintains a very high HDI, while also having one of the lowest GPDPC in the developed world. | ||
Neoliberal economists argue that the current size of the Pelaxian state and the disruptions to the economy created by the Meireles policies after the 1996 crash have hampered down private entrepreneurship and capital investment back into the economy. Neo-marxist economists argue that the GPD per capita isn’t really an economic statistic that should reflect a nation’s wealth, while we should also take into consideration its wealth distribution and the HDI. Furthermore, some neo-Keynesian economists will argue that the Pelaxed term is just an unfair reflection of the overall average GPD per capita of the world being just extravagantly high from the 1950s onward, while also being a logical result from the 1996 asset bubble. | Neoliberal economists argue that the current size of the Pelaxian state and the disruptions to the economy created by the Meireles policies after the 1996 crash have hampered down private entrepreneurship and capital investment back into the economy. Neo-marxist economists argue that the GPD per capita isn’t really an economic statistic that should reflect a nation’s wealth, while we should also take into consideration its wealth distribution and the HDI. Furthermore, some neo-Keynesian economists will argue that the Pelaxed term is just an unfair reflection of the overall average GPD per capita of the world being just extravagantly high from the 1950s onward, while also being a logical result from the 1996 asset bubble. | ||
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Eventually, many of these failing firms became unsustainable, and a wave of consolidation took place, resulting in four national banks in Pelaxia. Many Pelaxian firms were burdened with heavy debts, and it became very difficult to obtain credit. Many borrowers turned to loan sharks for loans. | Eventually, many of these failing firms became unsustainable, and a wave of consolidation took place, resulting in four national banks in Pelaxia. Many Pelaxian firms were burdened with heavy debts, and it became very difficult to obtain credit. Many borrowers turned to loan sharks for loans. | ||
===Economic Effects=== | ===Economic Effects=== | ||
[[File:Panorámica-750x500.jpg|thumb|Urban slam in post industrial sector of Albalitor|381x381px]] | [[File:Panorámica-750x500.jpg|thumb|Urban slam in post industrial sector of Albalitor|381x381px]] | ||
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===Social Effects=== | ===Social Effects=== | ||
While economic commentators tend to see stagnation as a negative phenomenon, qualitative studies conducted in Pelaxia show the opposite. There was a measurable increase in life satisfaction during the past three decades. Conversely, during the period of rapid growth in asset prices, no evidence of increased well-being was found in relation to that growth. This is partly due to the asset bubble being a driver for economic inequality, whereas the decades following the bubble's collapse have seen more economic equality and increased social spending by the government and left leaning policies such as the reorganization of the economy into a predominantly cooperative economic model. | While economic commentators tend to see stagnation as a negative phenomenon, qualitative studies conducted in Pelaxia show the opposite. There was a measurable increase in life satisfaction during the past three decades. Conversely, during the period of rapid growth in asset prices, no evidence of increased well-being was found in relation to that growth. This is partly due to the asset bubble being a driver for economic inequality, whereas the decades following the bubble's collapse have seen more economic equality and increased social spending by the government and left leaning policies such as the reorganization of the economy into a predominantly cooperative economic model. | ||
The lessons from Pelaxia align with concepts such as degrowth or qualitative metrics like GNH, which suggest that economic growth is not necessarily an appropriate metric for measuring the success and wellbeing of a society. | The lessons from Pelaxia align with concepts such as degrowth or qualitative metrics like [https://en.wikipedia.org/wiki/Gross_National_Happiness GNH], which suggest that economic growth is not necessarily an appropriate metric for measuring the success and wellbeing of a society. | ||
[[Category:Countries]] | [[Category:Countries]] | ||
[[Category:Pelaxia]] | [[Category:Pelaxia]] | ||
[[Category:Economy]] | [[Category:Economy]] | ||