Governments in developing countries typically play a larger role in investment spending in their economies than do the governments of developed countries.

Question

Quizplus · Accepted Answer

This is because developing countries often have weaker private sectors and less developed financial markets, making it harder for private investors to invest. As a result, the government often steps in to fill the investment gap and drive economic growth. Developed countries, on the other hand, tend to have stronger private sectors and financial markets, leading to less reliance on government investment spending.

Governments in Developing Countries Typically Play a Larger Role in Investment