Lessons From The Asian Economic Drive

Topics: Economic growth, People's Republic of China, Republic of China Pages: 5 (1700 words) Published: February 9, 2014

East Asian Tigers - Definition
The East Asian Tigers, sometimes also referred to as Asia's Four Little Dragons, referred to the economies of Taiwan, Hong Kong, South Korea, and Singapore; these territories and nations were noted for maintaining high growth rates and rapid industrialization between the early 1960s and 1990s. Contents [hide]

1 Characteristics of the Tiger economies
2 Model for third world economic development
3 Criticism of the export-driven trade model
4 Comparison with India
5 Comparison with mainland China
6 Taiwan: A case study
7 Other tiger economies
8 Related articles
9 External links
Characteristics of the Tiger economies

The East Asian Tigers pursued an export-driven model of economic development; these territories and nations focused on developing goods for export to highly-industrialized nations. Domestic consumption was discouraged through government policies such as high tariffs. The East Asian Tigers singled out education as a means of improving productivity; these nations focused on improving the education system at all levels; heavy emphasis was placed on ensuring that all children attended elementary education and compulsory high school education. Money was also spent on improving the college and university system. Since the East Asian Tigers were relatively poor during the 1960s, these nations had an abundance of cheap labor. Coupled with educational reform, they were able to leverage this combination into a cheap, yet productive workforce. The East Asian Tigers committed to egalitarianism in the form of land reform, to promote property rights and to ensure that agricultural workers would not become disgruntled. Also, policies of agricultural subsidies and tariffs on agricultural products were implemented as well. The common characteristics of the East Asian Tigers were:

Focused on exports to rich industrialized nations
Sustained rate of double-digit growth for decades
Non-democratic and relatively authoritarian political systems during the early years High tariffs on imports
Undervalued currencies
Trade surplus
High level of U.S. Bond holdings
High savings rate
Model for third world economic development

The East Asian Tigers were able to move from third world status to first world status in a few decades and were able to progress past other developing areas, particularly Latin America and sub-Saharan Africa. Until the mid-1970s it was not clear that the East Asian Tigers were a particular area of fast growth and that the Tiger development model produced superior results to either neoliberal (U.S.-backed policies), Soviet, or import substitution development models. Because of the success of the initial Tigers, many nations have followed similar development models. In part, this led to the Asian Economic Crisis in the 1990s. Criticism of the export-driven trade model

The East Asian Tigers were strongly affected by the Asian Economic Crisis, which impacted each Tiger to varying degrees. While Taiwan was not as strongly affected, South Korea was badly battered by the crisis. Because of the focus on export-driven growth, many of the Tigers became caught up in a game of currency devaluation. The current criticism of the East Asian Tigers is that these economies focus exclusively on export-demand, at the cost of import-demand. Thus, these economies are heavily reliant on the economic health of their targeted export nations. In addition, these nations have met difficulties after their initial competitive edge, cheap productive labor, no longer exists, especially with the emergence of India and China. Comparison with India

India has not had a land reform as consistent and thorough as Korea's or Taiwan's. (Singapore and Hong Kong are cities.) India already has a large intellectual and educated class able to export services. This will assist the transition and evidence of it can already be seen with the growth of the software and call center industries. If the...
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