Summary – MAE
Week 1 – Introduction
Overview of Asia’s growth:
Average growth rate higher than those of any other region in world
Over last 20 years, poverty rates in Asia have been more than halved, from
50% to 22%
In shocks of global financial crisis, these economies performed better than
any other region, contributing 50% of global growth in recent years
Economic indicators (!):
GDP (gross domestic product): refers to market value of all final goods
and services produced within country in given period; GDP per capita is often
considered indicator of country’s standard living
Gini coefficient: number between 0 and 1 that measures degree of
inequality in distribution of income in given society; coefficient would register
0 for society which each member received exactly same income and it would
register coefficient of 1 if one member got all income and rest nothing
CPI (corruption perception index): annually rank countries by their
perceived levels of corruption, as determined by expert assessments and
opinion survey; higher rank: lesser corruption
Inflation: is rise in consumer prices, increasing cost of living; as old saying
goes, inflations is caused by too much money “chasing” too few goods; just as
more money means higher, fewer goods mean higher prices
Growth in East Asia:
Japan’s economy took in 60’s off
Asian Tigers: NIE (newly industrialized economies)
Hong Kong, Singapore, South Korea and Taiwan;
Very high growth in ’60-’75
Outstanding growth in ’75-’90
Superior performance of Indonesia, Malaysia and Thailand
China and India are catching up
Common characteristics:
High-performance economies of East Asia have several common characteristics:
Dynamic agricultural sector Rapid growth of exports
Rapid demographic transition High investment and saving rates
High investments in human capital
Political stability:
Strongman rulers: Single-party dominance
North Korea, South Korea, Singapore, Japan, China, Malaysia, Singapore
Malaysia, Philippines, Indonesia, China
Gini coefficient (highest to CPI (highest to lowest)
lowest)
1. Hong Kong 9. South Korea 1. Denmark 39. South Korea
2. Singapore 10. Netherlands 1. New Zealand 46. Macau
3. China 11. Germany 1. Singapore 56. Malaysia
4. US 12. Sweden 13. Hong Kong 78. China
5. India 13. Japan 17. Japan 78. Thailand
6. UK 22. US 87. India
7. Canada 33. Taiwan
8. Taiwan 38. Brunei
, Week 2 – China
Demographics:
Large (same size as Canada; 9.6 million km2)
Huge population and growing:
About 1.3 billion (more than ⅕ of world’s population)
Most populous country in world
About 56% residents living in rural area
Much of its land is uninhabitable or costly to cultivate (only 10% of land
suitable for cultivation; mountains and deserts)
Much of its resource base undeveloped, e.g. large oil reserves only starting to
be exploited; rich, very long heritage
Economic overview:
2nd largest economy to GDP after US but still developing country
GDP per capita $5,445 (2012) Labor force
Agriculture: 10.9% Agriculture: 39.5%
Industries: 48.6% Industries: 27.2%
Services: 40.5% Services: 33.2%
People’s Republic of China: Republic of China (Taiwan):
October 10th ’49, PRC; Beijing Republic of China government
retreated to Taiwan
Chairman: Mao Zedong President: Chang Kai-shek
Important economic and political steps:
’49: PRC established, new China set up ’66 – ’76: Cultural Revolution
’50 – ’53: Korean War ’78: Open-door policy
’58 – ’62: The Great Leap Forward ’01: Accession intro WTO
(Three Years’ National Disaster)
Special administrative regions: Hong Kong (’97); Macao (’99)
Mao’s Legacies (!):
Industrial development in ’50s; modeled after Soviet Union
Promotion of rural industrialization in ’50s (Great Leap Forward);
economical and social plan to rapidly transform China from primarily agrarian
economy dominated by peasants into modern, industrialized, communist
society
Cultural Revolution (!):
Mao’s struggle to retake supreme leadership culminates in Cultural
Revolution;
Peaks from ’66-’69
Lost generation of leadership as universities closed and students sent
to countryside
No increase in GDP from ’65-’70
Maoist grown unsustainable:
Central control over resource allocation
Prevented flow of information and factors of production
Prevented market-determined prices and competition
Prevented China from utilizing cheap labor in international economy
Week 1 – Introduction
Overview of Asia’s growth:
Average growth rate higher than those of any other region in world
Over last 20 years, poverty rates in Asia have been more than halved, from
50% to 22%
In shocks of global financial crisis, these economies performed better than
any other region, contributing 50% of global growth in recent years
Economic indicators (!):
GDP (gross domestic product): refers to market value of all final goods
and services produced within country in given period; GDP per capita is often
considered indicator of country’s standard living
Gini coefficient: number between 0 and 1 that measures degree of
inequality in distribution of income in given society; coefficient would register
0 for society which each member received exactly same income and it would
register coefficient of 1 if one member got all income and rest nothing
CPI (corruption perception index): annually rank countries by their
perceived levels of corruption, as determined by expert assessments and
opinion survey; higher rank: lesser corruption
Inflation: is rise in consumer prices, increasing cost of living; as old saying
goes, inflations is caused by too much money “chasing” too few goods; just as
more money means higher, fewer goods mean higher prices
Growth in East Asia:
Japan’s economy took in 60’s off
Asian Tigers: NIE (newly industrialized economies)
Hong Kong, Singapore, South Korea and Taiwan;
Very high growth in ’60-’75
Outstanding growth in ’75-’90
Superior performance of Indonesia, Malaysia and Thailand
China and India are catching up
Common characteristics:
High-performance economies of East Asia have several common characteristics:
Dynamic agricultural sector Rapid growth of exports
Rapid demographic transition High investment and saving rates
High investments in human capital
Political stability:
Strongman rulers: Single-party dominance
North Korea, South Korea, Singapore, Japan, China, Malaysia, Singapore
Malaysia, Philippines, Indonesia, China
Gini coefficient (highest to CPI (highest to lowest)
lowest)
1. Hong Kong 9. South Korea 1. Denmark 39. South Korea
2. Singapore 10. Netherlands 1. New Zealand 46. Macau
3. China 11. Germany 1. Singapore 56. Malaysia
4. US 12. Sweden 13. Hong Kong 78. China
5. India 13. Japan 17. Japan 78. Thailand
6. UK 22. US 87. India
7. Canada 33. Taiwan
8. Taiwan 38. Brunei
, Week 2 – China
Demographics:
Large (same size as Canada; 9.6 million km2)
Huge population and growing:
About 1.3 billion (more than ⅕ of world’s population)
Most populous country in world
About 56% residents living in rural area
Much of its land is uninhabitable or costly to cultivate (only 10% of land
suitable for cultivation; mountains and deserts)
Much of its resource base undeveloped, e.g. large oil reserves only starting to
be exploited; rich, very long heritage
Economic overview:
2nd largest economy to GDP after US but still developing country
GDP per capita $5,445 (2012) Labor force
Agriculture: 10.9% Agriculture: 39.5%
Industries: 48.6% Industries: 27.2%
Services: 40.5% Services: 33.2%
People’s Republic of China: Republic of China (Taiwan):
October 10th ’49, PRC; Beijing Republic of China government
retreated to Taiwan
Chairman: Mao Zedong President: Chang Kai-shek
Important economic and political steps:
’49: PRC established, new China set up ’66 – ’76: Cultural Revolution
’50 – ’53: Korean War ’78: Open-door policy
’58 – ’62: The Great Leap Forward ’01: Accession intro WTO
(Three Years’ National Disaster)
Special administrative regions: Hong Kong (’97); Macao (’99)
Mao’s Legacies (!):
Industrial development in ’50s; modeled after Soviet Union
Promotion of rural industrialization in ’50s (Great Leap Forward);
economical and social plan to rapidly transform China from primarily agrarian
economy dominated by peasants into modern, industrialized, communist
society
Cultural Revolution (!):
Mao’s struggle to retake supreme leadership culminates in Cultural
Revolution;
Peaks from ’66-’69
Lost generation of leadership as universities closed and students sent
to countryside
No increase in GDP from ’65-’70
Maoist grown unsustainable:
Central control over resource allocation
Prevented flow of information and factors of production
Prevented market-determined prices and competition
Prevented China from utilizing cheap labor in international economy
