Diversification of Albertas Economy - Essay Example

Diversification as a concept has a special effect on Alberta’s economy, which is reliant on non renewable resources as its economic bedrock. It is vital that Alberta’s government develop policies that will aim to diversify the province’s economy, and make it wealthier. By relying on non renewable resource-based industries, Alberta’s economy becomes vulnerable to economic cycles of boom and depression This paper will aim to provide ideas on policies that the government can implement for its economy to minimize the probability of failure and maximize the probability of success.

Policies Active and proactive government intervention through policy formulation, it is possible to diversify Alberta’s economy. Government can intervene in such aspects as labor, trade, capital, and financial markets to create a diversified economy base for the province. The government’s involvement in the economy is also vital to diversify the economy. Increased government involvement and investment in the Alberta economy is vital for diversification to occur. Increased government involvement ensures that infrastructure gets created to prepare the economy for diversification Alberta is a landlocked province, and it is vital that infrastructure such as transport get created to facilitate business creation.

Infrastructure such as communication, health services, and electronics are crucial towards encouraging economic activity. Engagement of the government in the economy allows for massive generation of revenues that facilitate infrastructure construction. Government becomes involved through investments in private businesses and leading corporations in the province. Government should aim to offer venture capital for business start ups within the province both directly and indirectly. Government assistance should also get directed at the existing sectors, which have shown strength in the Alberta economy.

The government should create an enabling climate for investment through tax policy formulations. For there to be diversified economy in the province, the government should apply grants, subsidies, and tax incentives to generate varied economic activity (Mathias, 1971). The government can direct these financial tools towards economic sectors, which are under invested. These tools are crucial to develop the emerging industries within the province. This will invite on board investors who are motivated to take advantage of such government incentives.

These tools also ensure that the cost of production for the investors lowers down encouraging them even more to partake in economic activity within the province. To develop a diversified economy, the government should also revise its education policy to gear it towards labor specialization. The governments should enable a shift from the province’s general education curriculum to a job-directed education curriculum. The creation of specialized labor or skills within the Alberta economy would help generate economic activity (Mathias, 1971).

A diversified labor market promises labor to investors. It assures investors to proceed with their investment plans within the province as their labor requirement is available. The government in Alberta should offer this policy formulation to the universities and technical institutes in its region to encourage the specialization of labor skills. The Alberta government should also reduce over reliance on the economic importance of the unprocessed raw resources sector (Mathias, 1971). The government should encourage