california palm trees

What Is California’s Role in the U.S. Economy?

california palm treesCalifornia really does have it all. It’s one of the few places that has the ocean, mountains, forests, and deserts all within short driving distance.

The state is also a juggernaut economically. Not only is their economy huge, but it’s actually growing. With California having such a large place in American culture and history, a question has come up that needs to be answered:

What is the state’s role in the American economy?

Let’s take a look at how California impacts the rest of the nation and the world.

It’s Massive

If California were a nation, it would have the sixth largest economy in the world, and it’s currently growing at a faster rate than any other place. Pretty much any type of business you can think of is in California.

This makes the state a unique laboratory of ideas for the business world. This can work for or against businesses in numerous ways. If a company can thrive in this ultra-competitive market, it can thrive anywhere.

This also means that small start-up businesses can have a rough go. Someone starting up a business might have to acquire more capital than they would have to elsewhere, so people are constantly looking for business loans bad credit.

This, of course, creates another industry, with capital investors always looking to help people start companies. It’s a problem, but one that actually helps feed into the growing economy of California.

Its Diversity Helps Predict Problems and Successes in Other Places

The size of the California economy mixed with the diversity of businesses and people there help to predict what can happen in other places. Often, problems and solutions appear there before they do anywhere else.

The effects of climate change, combined with a growing population have already begun to impact the economy. Water and power shortages have impacted the state, as well as housing concerns.

The steps that California takes to combat these problems will be implemented elsewhere. Other states and nations learn from the successes and failures of the state, meaning that policy directives are inevitably impacted by the state.

National companies will also often roll out new products here due to the diverse population. This allows them to see how well their items will sell and who will buy it without having to spend large sums for research and marketing.

Driving Innovation

Some of the world’s biggest and most innovative companies call California home. Google, Facebook, Apple, and others call the state home.

These companies show that there is more to attracting and keeping businesses than low-income tax. California has one of the highest tax rates in the United States but still, manages to get and keep massive corporations.

This is because incentives are given to companies by the state for expanding operations and finding new smart ways to attract customers.

California’s Future

It is impossible to pretend that everything is perfect in California. There is still a large poverty rate, violent crime in the cities, and a high cost of living that makes it hard for even upper-middle class people to live in some areas.

Even with these concerns the state still holds a position of power in the country. Its influence can be felt in every corner of the nation and world.

The question for California when looking to the future is how to ensure that these concerns don’t slow down the growth that they are currently seeing.