Economic growth relates to the increased output within an economy. It can come from rural to industrial shifts, invention, innovation and technological progress; it requires savings and investment, along with a well-implemented policy framework and can be measured through the economies GDP. Haggard, (2004) suggested economic growth can result from productive inputs, capital and labour or from greater efficiency in their use. It can lead to economic development, which Michael Todaro (2011) suggested to be a multi-faced process that involves the reorganization and reorientation of entire economic and social systems, involving radical changes to social structure, institutions, and cultural beliefs and norms. Throughout the 1950’s and 1960’s
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Page, J. (1994) stated it was an unpredicted factor in the growth of the Asian economies. Boltho, A & Weber, M (2009) suggests a proper macroeconomic policy framework needs efficient bureaucracy that is not prey to political interest or tainted by corruption. Both China and the HPAE’s were able to achieve this. However, there is diversity amongst they ways in which the economies achieved it, as it was dependent on the economic conditions and individual preferences. Both China and the HPAE’s use a variety of macroeconomic tools flexibly, such as- low inflation, appropriate exchange rate regimes, budgeting deficits and managing external debts. Controlling inflation is vital as it helps to maintain competitiveness for exporters and domestic businesses facing competition from imports. Low inflation enables savings and investment; Harrod Domar model of growth (1946) suggests that the growth rate of national income is directly related to the saving ratio, growing the GDP of the country. Over the past 30 years the average annual inflation in HPAE’s had dropped to 9 percent, compared to 18 percent in other low and middle income economies. The Asian economies had comparable amounts of high-level savings; mainly coming from private investment. The population felt it was necessary to retain parts of their salaries, as there was lack of trust in informal institutions such as limited healthcare, pensions and insurance. …show more content…
Over 30 years or more, both have dramatically improved education and training systems. This was largely led by primary and secondary education reforms as opposed to higher education. Coulombe and Tremblay’s (2006) research supports this view by arguing that for a nation to develop it is more important to increase the average literacy skills, rather than increasing the percentage of individuals that achieve high levels of literacy skills.
The HPAE’s recognized the importance of the need for a skilled workforce and the majority of public spending was directed towards technology and science, with the vision to create a highly skilled workforce with the skills necessary to expand the
Page, J. (1994) stated it was an unpredicted factor in the growth of the Asian economies. Boltho, A & Weber, M (2009) suggests a proper macroeconomic policy framework needs efficient bureaucracy that is not prey to political interest or tainted by corruption. Both China and the HPAE’s were able to achieve this. However, there is diversity amongst they ways in which the economies achieved it, as it was dependent on the economic conditions and individual preferences. Both China and the HPAE’s use a variety of macroeconomic tools flexibly, such as- low inflation, appropriate exchange rate regimes, budgeting deficits and managing external debts. Controlling inflation is vital as it helps to maintain competitiveness for exporters and domestic businesses facing competition from imports. Low inflation enables savings and investment; Harrod Domar model of growth (1946) suggests that the growth rate of national income is directly related to the saving ratio, growing the GDP of the country. Over the past 30 years the average annual inflation in HPAE’s had dropped to 9 percent, compared to 18 percent in other low and middle income economies. The Asian economies had comparable amounts of high-level savings; mainly coming from private investment. The population felt it was necessary to retain parts of their salaries, as there was lack of trust in informal institutions such as limited healthcare, pensions and insurance. …show more content…
Over 30 years or more, both have dramatically improved education and training systems. This was largely led by primary and secondary education reforms as opposed to higher education. Coulombe and Tremblay’s (2006) research supports this view by arguing that for a nation to develop it is more important to increase the average literacy skills, rather than increasing the percentage of individuals that achieve high levels of literacy skills.
The HPAE’s recognized the importance of the need for a skilled workforce and the majority of public spending was directed towards technology and science, with the vision to create a highly skilled workforce with the skills necessary to expand the