Introduction Thailand is an Asian country with an area of 513,115 sq km which is almost equivalent to the size of France. It has a population of 65.28 million people with a labor force of 36.43 million people. The country was never colonized. Thailand Economic Growth Thailand’s economic growth has been steady with a respectable 6.6% growth rate. However, this growth has not been achieved year in year out and it has also not been similar in all sectors of the economy. 1980 to 1990 is the time when Thailand experienced the highest growth rate which averaged 9.1percent per annum. These growth rates were necessitated by the growth in the manufacturing sector. The coefficient of variation of rates of growth also decreased to only 0.27. This period was the most stable in terms of the country’s economic performance. However, the period from 1997 to 2000 was a very difficult period for the economy of Thailand with the economy only growing by -0.9 percent. This was accompanied by a bulging standard deviation of 7.1 percent. Hence the country turned from its course of a prosperous country to a difficult course of economic hardships. The GDP drop in this period corresponded with reduced uses of capital stock and reduced uses of labor input. In terms of demand, the shrinking of the investment demand was the downward force that led to the recession in 1997-2000. The economic recovery process is still very shaky and the situation in the country in 2001 was deemed to be worse than in 2000. This is because the economic growth rate has stagnated with the unemployment rate increasing rapidly (Alesina, 2007) Banks in the country are still reluctant to lend lest they fail to get back repayments because of the borrowers’ balance sheets which are undercapitalized and also due to unfavorable macroeconomic outlook. The 7 percent per annum economic growth rate in the country over the four decades has raised the well-being of the people in the country. The income poverty levels sharply declined substantially to 11.2% (headcount ratio) in the period 1990-1996 which was the lowest from 57% which was experienced in 1960-1970. This trend has however increased to 14.2% in the year 2000-2007. In summary form this trend has taken the following shape 1962-1963 the poverty incidence was 57%,1968-1969 the poverty incidence was 39%,1975-1976 the poverty incidence was 31%,1981 the poverty incidence was 23%,1986 the poverty incidence was 29.5% and from 1988 to 2007 the poverty incidence decreased from 32.6 percent to 14.2 percent. (Alesina, 2007) The country’s overall growth rate has been a result of increases in input use and increases in total factor productivity, (TFP). The main engines of growth are agriculture, industry, manufacturing, and services, and factors of production such as capital, labor, and land. From 1981 to 1985 the total factor production was 9.7 while from 1986 to 1995 the total factor production amounted to 17.3.1986 to 1990 the total factor production was 31.3 and from 1991 to date, the total factor productivity has been at the lowest level of 0.4. Thailand has for a long time been the top agricultural exporter. This has been necessitated by the continued res