30885775 singapore 2276b 537214441 indonesia 572c 617

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3.0885.775 Singapore - - - 2,276b 5,37214.441 Indonesia 572c 617 1.009 727 1.253 2,118 Philippines - 735 1.106 1 943 1,629 1,934 i China - 494 548 i 41 7 924 2,594 Taiwan - 484 690 595 2,226 6,574 South Korea - 568 945 565 1,7826.012 Japan 480 724 1,192 1,208 7,13313.197 a. guess b. 1960 c. 1880 Note Three-year averages centred around the years shown Source: P. van der Eng, 'Assessing economic growth and standards of living in Asia, 1870-1990', in Latham, A. and Kawakatsu, H. (eds.) The evolving structure of the East Asian economic system since 1700: a comparative analysts., ( 1 4 1 .1.an, 1990
Source: Australia in the Asian Century (2012) Source: Australia in the Asian Century (2012) Source: Australia in the Asian Century (2012)
Source: Australia in the Asian Century (2012) Source: Australia in the Asian Century (2012)
Definition of an NIE Savings ratio at least 15 per cent Real GDP of at least US$ 1000 per capita Share of manufacturing in GDP and employment of at least 20 per cent A Human Development Index (HDI) of at least 0.75. 0.75. a. Higher savings lead to higher investment in physical capital, that in turn drive productivity of an economy and ultimately bring about growth. b. Share of manufacturing in GDP and employment indicates the extent of industrialisation an economy . In growth economy, society evolves from a primary agricultural/fishery (using muscle) to industrial society (using machines) for production as to increase productivity c. Human Development Index denotes the upgrading and improvement of labor skill sets to enhance worker productivity. Technically, it consists 3 components: capital income , life expectancy and education attainment level. d. Thus, the above measures emphasize how an economy grows to an industrial economy thru improvement in the measures above. Any economy is yet to achieve such minimum performance, that economy is still classified as Less Developed Economy. 21
The take-off of the NIEs Rostow and the concept of take-off Crucial factors in the take-off: Savings ratio Capital output ratio Population growth rate Population growth rate Take-off requires savings ratio>(capital output ratio)*(population growth) Dating the take-offs An economy sails thru three phase: Less Developed, Industrialized, and Developed (Advanced) Economies. The point of take off from Less Developed Status to NIE status is when the above four conditions with their respective minimum measures stated in previous slide are actualized. 22
The Rostow’s take-off (Supplement Notes) 23
Industrialization & Urbanization (Supplement Notes) 24
A brief review of East Asian growth, 1870 to 2006 Measurement problems: statistical inaccuracy, definition variances, different approaches and deliberate manipulation. Japan not the only country to experience growth prior to the Second World War Setbacks 1929-50 Setbacks 1929-50 1950-73 Post-war growth boom 1973-97 accelerated growth in East Asia 1997 Asian Economic Crisis 1998- Recovery process (We will study these in great details in two supplement articles and related discussion notes: : a: The Myth of Asia Miracle; b. The East Asian Miracle – Economy Growth & Policy ) 25
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Growth rates of GDP (per cent) Source: Asian Development Bank 29
Key factors in the growth of the NIEs Favourable international environment (Globalization, high commodities and basic consumer goods demand after 2 world wars, deregulation, information and communication, transportation, political stability as international community is tired with wars) Favourable internal environment (Education, cost advantages, population growth, labor abundance, political stability)

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