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Thoughts on economic development model of East Asia.

Author: JingMing From: www.yourpaper.net Posted: 2007-11-19 13:36:31 Read:
because the originating in Southeast Asia's financial crisis spread to the Northeast Asian Japan / South Korea and other places, many people have doubts about the so-called "East Asia mode", the risk is attributed to the "Asian model" of the crisis, the positive role which negate these national and local governments play in promoting rapid economic growth process in the.Have sex this view, will mislead the understanding of the financial crisis.
a, there is no single "East Asia mode"
the theory of the "Asian model" has been discussed for a long time.The initial divergence from the analysis of the Japanese and later the Asia's "four little dragons" rapid growth causes.They sustained high economic growth rate is the there was no parallel in history.Most of the orthodox view of economists stressed the basic role of the market power, there is also a part of economists and the developed countries in Europe and America's situation is different, their governments (mainly Japan, Korea and other countries the government plays a leading role).In 1993 the World Bank launched called "East Asian miracle" report, these two points to reconcile, that Japan, the "four little dragons" and Indonesia, Malaysia, Thailand, 8 countries and regions in 1965 ~ 1990 years of rapid growth, is the interaction of government policies and market forces results; and certainly the day, South Korea and Taiwan are to promote growth choice intervention measures.This study caused more discussion on the so-called "East Asia mode".For example, Paul.In 1994 Krugman wrote that "the East Asian miracle is exaggerated myth", he thought that except Japan, most countries and regions of East Asia's economic growth is mainly depend on the increase of factors of production inputs rather than improve productivity, the same properties and growth when the Soviet Union; with investment increase the speed of the decline, the high speed of economic growth will eventually fall.Since 1997, Aoki Masahiko put forward the "market system enhancement theory", from "coordination failure to overcome" perspective on the economic role of government in East Asia makes a new interpretation.1997 published by the World Bank World Development Report "the state in a changing world", also can think is to continue this discussion.The report pointed out: "without an effective government, sustainable economic and social development is not possible," and that the core mission of government, is the completion of such five basic tasks: to establish the legal basis; keep non-distortionary economic environment, including the maintenance of macroeconomic stability; investment in basic social services and infrastructure; maintain the endurance of poor social stratum; protect environment.This report thinks, for developing countries, not least "that government is best".
in fact, the development pattern of East Asian countries is not consistent, not only in these countries have differences in natural conditions, the role of government in the process of economic growth in the role is also not the same.For example, Hongkong and Singapore are city, and initial conditions when the "two yuan economic" obvious characteristics of the South Korea, China Taiwan and India, Thailand, horse of the three Southeast Asian countries vary greatly; Japan is early in 1885 ~ 1919 years has achieved rapid economic growth.In terms of economic function of government, the initial condition is similar to Hongkong and Singapore, Thailand and Malaysia, China, Taiwan and South Korea, have significant difference; Han, Thailand, Indonesia compare for serious crisis and to the IMF for assistance loans to countries, development model and development stage, they are not the same.Foreign economic relations, foreign trade and foreign investment in the role of Japanese economy in rapid growth is far better than other countries in East Asia significantly, Japan, South Korea to foreign direct investment attitude and Southeast Asian countries and Hongkong also have very big difference.In short, from the actual situation, there is no single "East Asian Development Model", so there is no so-called "East Asian model" of the crisis.
two, the East Asian financial crisis and the financial system is closely related to the defect
this financial crisis in the beginning shows such features: the banking system more stable countries and regions, such as Singapore, Hongkong, the economic impact is relatively small; and the more banks and other financial institutions of countries, the economic impact is larger, and the collapse of the stock market. At the same time, the common feature of financial crisis of East Asian countries, and is the main reason of the crisis (defect formation, Japan in the late 80's bubble economy after the bubble burst and the economic downturn, as well as the current recession, also the main source to its financial system).Then their financial system what is unique?
many econometric analysis shows that, high growth and high in East Asia is closely related to the physical capital accumulation; and the physical capital accumulation is the result of savings into investment, savings into the intermediary organization investment mainly is financial system.Therefore, can be said that the realization of the East Asian growth can not be separated from its financial system on savings mobilization and allocation.A period of rapid growth, many countries in East Asia to Japan as the representative of the financial system has some characteristics, different from the Anglo-American countries such as: (1) firms rely more on financial institutions loans rather than the stock market financing; (2) the enterprise debt to capital ratio is higher; (3) the government allocation of credit for guidance and control, not the main financial regulatory agencies, and sometimes protection and subsidies to banks and other financial institutions; (4) the relationship between the banks and enterprises more closely (such as Japan's "main bank" system); (5) Company cross-ownership of more widespread (between enterprise chaebol had each other the loan guarantee).
can be used more in savings (because household savings tendency is higher or the active use of foreign savings), the government to rapid economic growth as the goal, the main advantages of the system is of help to "stimulate investment".
at the same time, the Asian financial system for investment promotion of the superiority and can't hide it in the other aspects of the defect.The main performance is: the government from the actual industrial policy, direct to the control of the bank to provide loans to the industrial policies of the enterprise, bring a lot of bad assets of banks; there is a close relationship between banks and enterprises, some poor efficiency, higher debt, a serious loss of business can continue to obtain bank loans, the collapse of these enterprises when the relationship between drag closely with banks in trouble; some government officials because they can exert influence on bank loans for personal rent-seeking opportunities, etc..The deeper question is, government financial institutions, mainly bank liabilities provide virtually guarantee (such as Japan's long-term adherence to the "financial institutions fail" policy, the owners and the government officials of Indonesian banks have close relations, Thailand's financial liabilities of the company in fact the government guarantee, South Korea in the bank when they encounter difficulties to bank debt as the national debt), while reducing financial risk of creditors, but increased as the debtor's financial institutions of "moral hazard": to lower the cost savings, and then engage in high-risk investment or income is not high investment.The result is a large number of financial institutions, large investments in debt, and the short-term debt (including debt) is not "matching" and long-term assets, leading to excessive investment, and high risk of the real estate market bubble, financial assets.Stock market, financial institutions and a large number of enterprises closed down, as a remedy for the series of phenomenon, has its inevitability.On the whole, some East Asian countries in the financial system, not only the achievements of the past their rapid economic growth, but also directly related to their current financial crisis.

some East Asian countries experience actually show, a good developing financial system should be the number can maximize the mobilization of domestic savings, and the savings into investment, and on the other hand, can guarantee the investment quality, so as to promote investment in increasing and guarantee the balance the quality of investment.If the investment is of high quality and the amount of investment is not big enough, will affect the speed of economic growth; if the investment amount increased a lot and a lot of investment quality is not high, economic growth will be difficult to sustain.
three, can not negate the positive role of the government in the economic development of East Asia
most East Asian countries is another common feature is, in its rapid economic growth, the government intervention in economic activity more, and in the national crisis more serious such as Thailand, South Korea, Indonesia, exchange rate, government debt management mistakes are more obvious.But not after the financial crisis happened, can completely negate the positive effects on economic growth of East Asian government intervention.Many studies have shown that, East Asian governments in promoting economic growth and improving the income distribution has many successful experiences in other countries can learn from, such as:
equal government attaches importance to education and educational opportunities, contribute to the improvement of labor quality and human hand
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