Most of the economic systems want their economic growing to travel up while they have some large jobs which ca n’t instantly cover with, like: unemployment, rising prices, trade spread, and so on. Viet Nam economic system has besides had the same state of affairs. Before 1986, Viet Nam had still been in the subsidy period and it was a low developed state. Since the Government applied the unfastened door policy in 1986, everything had changed and the Viet Nam economic system had kept increasing and making the highest growing rate in 2008.

In fact, there is a batch of grounds to do the rising prices addition in Viet Nam. They can be the pecuniary policy of the authorities, impact on the fiscal crisis. The rising prices makes the devaluation of Vietnam currency and it besides is the chief ground makes the economic growing low developed. Furthermore, the high rising prices rate causes more hard for everybody, exceptional for concerns. They will non afford to pay for their employees so they will fire more. That consequence explains why the unemployment rate additions in Viet Nam in the recent old ages.

Because the state with the high unemployment rate shows its economic system is so bad, Viet Nam authorities wants to maintain this rate is around 5 % . Overall, this rate is control rather good comparison with the other economic systems although the authorities lose to command about rising prices. And Viet Nam become one of the states have the highest velocity of economic growing all over the universe.

Contentss

Introduction 3

THEORY PAGE 4

Introduction

Viet Nam, a really hapless state has risen up after 24 old ages implemented the “ open-door ” policies since 1986. It was a large alteration from the bid market ( the economic system under a 100 per centum control by Vietnamese ‘s authorities ) into free market and planetary integrating economic ( with 40 % control by authorities ) . Vietnam ‘s economic system is a assorted economic system. The current authorities of Vietnam has the undermentioned economic sectors: State economic system, corporate economic system, private economic system ( single, little proprietors, private capital ) , economic system foreign-invested. The State ‘s intercession still remains at high degrees such as adjust gasolene monetary values, monetary value controls on steel, cement, and wood coal to guarantee the people ‘s benefits.

In the general tendency of the planetary fiscal crisis in 2008, Viet nam has besides less suffered some certain influences to the economic growing by FDI poured in Viet Nam was low, export fell, the fluctuation exchange rate between VND and USD every bit good as the cause of high rising prices. On the other manus, a assortment of concern invested overseas belly-up lead to increased unemployment.

However, Vietnam was still a taking agricultural exporter and the 2nd attractive foreign direct investing finish next to China in Asia- Pacific. Which achieved 6,2 % Gross Domestic Product ( GDP )[ 1 ], the increasing of standard life with mean gaining per capita attained 1,024 USD[ 2 ], and entire gross national income was 1,436,955 billion USD in 2008[ 3 ]. Vietnam ‘s economic prognosis continues to travel with high economic growing rate, indexs of unemployment and low rising prices under dual figures in the old ages in front.

THEORY PAGE[ 4 ]

The significance of “ unemployment ”

An economic status marked by the fact that persons actively seeking occupations remain unhired. Unemployment is expressed as a per centum of the entire available work force. The degree of unemployment varies with economic conditions and other fortunes.[ 5 ]

Number unemployed ( economic expert ‘s definition ) : those of working age who are without work, but who are available work at current pay rates.

Labor force: the figure employed plus the figure unemployed.

Unemployment rate: the figure unemployed expressed as a per centum of the labour force.

Claimant unemployment: those in reception of unemployment -related benefits.

Standardized unemployment rate: the step of the unemployment rate usage by the ILO and OECD. The unemployed are defined as individual of working age who are without work, available for work and actively seeking employment.

The rising prices:

The overall general upward monetary value motion of goods and services in an economic system ( frequently caused by a addition in the supply of money ) , normally as measured by the Consumer Price Index and the Producer Price Index. Over clip, as the cost of goods and services addition, the value of a dollar is traveling to fall because a individual wo n’t be able to buy every bit much with that dollar as he/she antecedently could. While the one-year rate of rising prices has fluctuated greatly over the last half century, runing from about zero rising prices to 23 % rising prices, the Fed actively tries to keep a specific rate of rising prices, which is normally 2-3 % but can change depending on fortunes.[ 6 ]

Demand- full rising prices: rising prices caused by relentless rises in aggregative demand.

Cost – push rising prices: rising prices cause by relentless rises in cost of production ( independently of demand ) .

The relationship between rising prices and unemployment

Full -employment degree of national income ( existent GDP ) : the degree of national income ( existent GDP ) at which there is no lack of demand.

Recessionary or deflationary spread: the deficit of aggregative outgo below national income ( and injections below backdowns ) at the full-employment degree of national income.

Phillips curve: A remedy demoing the relationship between ( monetary value ) rising prices and unemployment. The original Phillip curve plotted pay rising prices against unemployment for the old ages 1861- 1957.

Accelerationist theory: The theory that unemployment can merely be reduced below the natural rate at the cost of speed uping rising prices.

Economic growing:

Accelerator theory: The degree of investing depends on the rate of alteration of national income, and as a consequence tends to be capable to significant fluctuations.

Real concern rhythm theory: The new classical theory which explains cyclical fluctuations in footings of displacements in aggregative supply, instead than aggregative demand.

Steady- sate national income: The long -run equilibrium degree of national income. The degree at which all investing is used to keep the bing capital stock at its current degree.

Endogenous growing theory: A theory that the rate of economic growing depends on the rate of technological advancement and diffusion, both of which depend on intuitions, inducements and the function of authorities.

Standard of Life:

Income: GDP per capita

GDP per capita has grown rapidly and steadily over the last two decennaries, yet it is at a low absolute degree. ( Vietnam ‘s fight study 2010 )