The role of trade in the economic development of Eastern Asia

Résumé du document

At the end of the last century, Hong Kong, Singapore, Taiwan and South Korea attained higher rates of economic growth than other developing countries. It could be because of a close correlation between export expansion and economic growth, but are they automatically associated? What is the importance played by trade in the economic development of these countries? Classical view says that the growth of trade brings an economic growth, but maybe there is not relevant link between trade and growth. In this paper we will critically assess the role of the trade expansion in the economic growth and development. In a first part we will criticize the linkage between export growth and economy, after we will assess the trade policies on industrialization and development. The third and last part will evaluate the impact of trade on other indicators of development such as the ones which compose the Human Development Indicator.

Extraits

[...] Figure as we said before, show us that the education level has been raised. The reason was to increase the productivity level of the labour force but also with research and development objective in science and technology. The raise of wage between the 1950s and the end of the 1980s that we can observe in Figure 4 is significant, even if they stay largely under the growth the US wages, the raise of the EAC incomes allowed the population to access to better life condition and more health secure, and in the same time to stay very competitive on the world market price. [...]

[...] Economic Growth in East Asia: Accumulation versus Assimilation. Extract from: Brookings Papers on Economic Activity Issue 2. pp.135 to 203. Lee C.H. & Naya S.Trade in East Asian Development with Comparative Reference to Southeast Asian Experiences Extract from: Economic Development & Cultural Change, The University of Chicago. Volume 36 Issue 3. pp 123 to150 Huff W.G, Singapore's economic development: four lessons and some doubts. Extract from: Corporate Location. Oxford Development Studies. February 1999, Volume 27 Issue 1. [...]

[...] Taiwan instead of direct intervention in market and trade decided to support the development of science and technology. “Taiwan focused on facilitate the inflow of advanced technology and on support its implementation by establishing a science based industrial park” (Lee & Naya p.17). By consequence the tertiary sector took some more importance after the mid of the 1970s: between 1970 and 1989 the employment in the tertiary sector grew up from 43% to (MASGE Module Handbook p.6). Contrary to Taiwan, Singapore decided to intervene of the labour market raising the wages ] wages were raised in several successive increments by a total of about 80% over the 1979-81 period” (Lee & Naya p. [...]

[...] But at the same time imports grew up as well, partly because of the raising need in petrol of the East Asian countries. If we looking at Figure we can effectively say that during the growing period of export, the growth of GDP per capita also increased for Singapore and Taiwan, for Hong Kong the GDP increase also but its growth slow down. But when we look at Figure we can see that for both South Korea and Singapore there is no positive correlation between the GDP growth rate and the export growth rate, in fact it reveal that the growth of export do not procure every time the same growth of GDP, and a slow down of the export rate growth does not mean that the GPD growth will slow down. [...]

[...] This phenomenon has been more visible in South Korea and Taiwan: primary sector represented respectively 66% and 56% of employment in 1960 to decrease to and in 1989 (MASGE Handbook p.6). Once again manufacturing of products played an important role in both growth of GDP and employment: average manufacturing output in the 1970s accounted for more than 25% of GDP in East Asian countries and 22% of employment, in 1980 it represented 30% of GDP and employment” (1998, Lee & Naya, p16). The labour absorption by the growing manufacturing was exceptional. [...]