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Research Paper Draft - Causes and Effects of California's...

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Causes and Effects of California’s Matchless Economy At first glance, California’s economy is overwhelmingly difficult to describe. In order to truly understand the nature of the beast, one has to understand the rationale behind all of the state’s different markets. Just as a stock investor is told to diversify in order to protect their assets, California diversifies its different economic markets in order to protect the state’s overall revenue. In the investor’s case, they wouldn’t want one stock to determine whether they are wealthy or poor; just as in California’s case, one wouldn’t want a single product to determine whether the state has a thriving or declining economy. California has a very strong and, more importantly, a very unique economy; there are many different facets of the state’s economy, such as agriculture, wine, entertainment, and technology. California’s economy is easily the strongest of the fifty states, with a Gross State Product (GSP) of $1.5 trillion in 2004 (Legislative Analyst's Office). The state’s vigorous economy both affects and is affected by the many different lifestyles within the state. The diverse demographic and climatic conditions throughout California result in a multi-faceted economy that, unlike most, does not rely on any one product for the majority of its revenue, but on a wide array of different products. The contrary is also true, as California’s distinct economy has a powerful effect on the lifestyles throughout the state, whether it is transportation, education, or crime. California’s economy’s greatest strength is undoubtedly its diversity of markets. With so many different facets of the state’s economy generating major revenue, the economy remains stable even when certain products have poor years in terms of overall revenue. The various different sectors of the economy include the entertainment industry, agriculture, wine production,
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and technology. Each of these economic “sectors” is primarily located in a different region of the state, with each region specializing in their own unique product. Perhaps the most unique sector of California’s economy is the entertainment industry. To quote the Governor, Arnold Schwarzenegger: “Our unparalleled motion picture industry is one of the key reasons that California is truly ‘The Golden State’ – a global cultural icon, and the sixth largest economy in the world.” It is also likely the first sector that comes to people’s minds when California’s economy is discussed, as Los Angeles, the biggest city in the state, is also called the “entertainment capital of the world,” for the many different television and motion picture productions that are shot in the area. This nickname is not given in vain, as there are more television and motion picture productions in California than anywhere else in the world, with over 365 different productions in 2005 (Epstein). Edward Jay Epstein reports that US films around the world earned over $10.4 billion in
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Research Paper Draft - Causes and Effects of California's...

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