Fly Ash Brick Project Case Study Solution
ASIAN MIRACLE
The Asian miracle of East Asia has a remarkable record of high and sustained economic growth. However, twenty-three economies grew faster than all other region in the Asian continent over the period of 1965 to 1990. This achievement is a scribableto seemingly miraculous growth in around eight high-performing Asian economies (HPAEs).Moreover, over the past thirty-five years, Taiwan, Korea and Singapore and the three newly industrializing economies (NIEs) of South-east Asia, Indonesia, Malaysia, and Thailand have transformed themselves from technologically backward and poor, to relatively modern and affluent economies.
Over the period, East Asian economies provide a wide range of policy frameworks- extending from Hong Kong’s relatively complete laissez-faire to the highly selective policy of regimes of Korea. It co-occurrence of activist public policies and rapid growth in some of the East Asian economies. However, these four countries (including Taiwan, Hong Kong, Singapore and South Korea) have raised complex and disputable questions concerning the relationship between government, the market, and the private sector.
Furthermore, the HPAEs are primarily a highly diverse group of economies, differing in natural resources, population, culture and economic policy. On the other hand, firstly identify the characteristics of these eight economies that could share them to be grouped together and set aside from other developing economies.
In addition to this, these all eight countries had rapid and sustained growth over the period of 1965 to 1990. Thus, this in itself is unusual among developing economies. All the eight HPAEs are positive outliers in the income-growth distribution. On the other hand, Malaysia, Indonesia, Philippines, Thailand although closer to their predicted values. While the remaining four economies, Korea, Taiwan Singapore and Hong Kong all are relatively significant above their predicted gross domestic product (GDP) per capita growth rates, on the basis of relative income level.
By the time, all the HPAEs were catching up to the more developed countries. However, recent work on growth rate persistence indicates that growth rates for individual economies are highly unstable over time(Fogel, 2009). The HPAEs, whereas, appear to be an exception. Depending on the period selected and the measure of persistent success (in a manner of the fraction of the distribution used to measure high growth), the HPAEs consistently rank with the handful of persistently rapidly growing economies.
Moreover, the HPAEs are unique in relation to rapid, sustained growth with highly equal income distributions. However, the proportion of forty economies is ranked by the ratio of the income share of the fifth richest of the population to the income share of the fifth poorest and per capita real GDP growth during 1965 to 1990.
On the other hand, all of the high-growth, low-inequality income economies are in East Asia. However, with the comparison of East Asia economies. The Gini coefficient and growth rate by decade indicate that the distribution of income was relatively more equal in the fastest growing HPAEs. Additionally, improvement in the income distribution generally coincided with the period of rapid growth(Moenius, 2008).
In the same manner, the fundamentalist-mystic consequently is at heart the debate on the public policy origins of East Asia’s success. However, fundamentalists have stressed East Asia’s success in relation to basics right. They lead to attributing success to policies that increased physical and human capital per worker,and that provided for efficient allocation. They proclaim that the successful Asian economies have been better than others at providing a stable macroeconomic environment and also providing a reliable legal framework to promote domestic and international market competition. However, they also stress that the orientation of the HPAEs toward international trade and the lack of managing price and other distortionary policies have led to relatively low price distortions. Investments in education, people and health are primarily important roles for government in the fundamentalist story(Nelson, 2016).
In East Asia, the mystics proclaim, governments remedied this by deliberately “getting the price wrong” to promote industries that would not otherwise have to succeed(Robertson, 1998). The mystics lay stress on the dynamic gains of activist government policies to reorganize industrial infrastructure and promote technological learning, over time at the expense of static all ocative efficiency. In the same manner, while fundamentalists would explain growth with a standard set of relatively sustained policies, mystics state that the policy mixes used by East Asian economies were flexible and diverse. They proclaim that East Asian governments “governed the market” in critical ways(Mody, 2016).
On the other hand, the fundamentalist view of the success of the HPAEs is that their investment levels in human and physical capital relatively exceed those for other countries at same levels of development, evolving in more rapid growth in per capita income. However, the relationship between income level and average investment rate for the period of 1965 to 1990 indicates that there is substantially more regularity in the relationship between relative income and investment share. The investment rate for overall countries increases with income up to nearly about 70 percent of U.S GDP in the mid-1960 and then declines.
Moreover, the eight HPAEs economies conform much more strongly to the cross-country pattern of investment rates than to the pattern of growth rates. However, Thailand and Hong Kong lie closer to their predicted value on the basis of the cross-country regression. In the same manner, Malaysia and Korea are the extreme outliers among HPAEs, but they are not extreme outliers in the distribution. Whereas, high investment rate are part of the Asian success story, but up to some extent they cannot fully describe the extent to which per capita income growth in the HPAEs deviates from the typical pattern.
On the other hand, two HPAEs economies are in the upper decile of the TFP (total factor production) distribution in both sets of estimates- Hong Kong, and Taiwan. Two others- Thailand and Korea are in the upper decileof the distribution based on the full sample production function parameters. However, they are unremarkable on the basis of the high-income country production function parameters. Three economies including Indonesia, Singapore and Malaysia shift from modest, but positive, TFP growth to negative TFP growth however when the production function parameters are relatively changed from those predicted from the whole sample to those acquired from the high-income sample.
Furthermore, the TFP predicts based on the high-income country sample are used. However, the relationship between productivity driven and investment driven economies is dramatic. On the other hand, rapid growth in Malaysia, Singapore, and Indonesia is totally due to high rates of factor accumulation. Whereas, their productivity performance, like that of the vast majority of developing economies, directed from the potential growth output that could have been achieved, regarded on their rates of factor accumulation.
In the same manner, Hong Kong and Taiwan, in particular, had primarily high TFP growth rates and derived their output growth from TFP growth.However, the East Asian economies success is primarily a fundamentalist one. Depending on predicts used, approximately 60 percent to 120 percent of their output growth derives from the accumulation of physical, labor force and human capital growth. However, results also indicate that the HPAEs were unusually successful in allocating these factors of production.
On the other hand, some of the HPAEs advantaged from a head start in terms of the public administration and education systems. However, most of their growth resulted from getting the policy basics right. In a similar manner, most East Asian governments have continued sector-specific industrial policies to some degree. Although Singapore, Malaysia, Taiwan and even Hong Kong have also established programs- specifically with more moderate incentives- in order to accelerate development of advanced industries. As a consequence, the prices of labor and capital in the HPAEs were relatively closer to their insufficient values than in other developing economies(Fogel, 2010).
Fly Ash Brick Project Harvard Case Solution & Analysis
In the case of Korea and Taiwan, governments made systematical efforts to reorganize the industrial structure for the determine of accelerating productivity change.On the other hand, although all HPAEs except Hong Kong passed by an import substitution phase, with the high and variable protection of domestic import substitutes. However, Malaysia, Singapore, and Hong Kong initiated trade regimes that were close to free trade. Japan and Taiwan initiated mixed regimes that were largely free for export industries. In the same manner, Thailand and Indonesia have begun to reduce protection in the 1980s. Exchange rate policies were liberalized and currencies usually devalued, to support export growth.................
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