What are the effects of large emerging countries like China and India on the world economy?

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What are the effects of large emerging countries like China and India on the world economy

Introduction

The world economy is an exciting . The collapse of the centrally planned economies , the oil crisis , the Great Depression in the 1930s the failure of Latin America in the lost decade of the 1980s and the success of the Asian `tigers ' in spite of the temporary financial disturbance in 1997 /98 - these are all fascinating issues . The world economy is becoming more global . The segmentation

of markets is being reduced new regions , which have until recently scarcely been involved in world trade , are pushing into the international division of labor The reader will be familiarized with the most important variables of the world economy , notably world product and its composition from the production and the expenditure side as well as its regional structure The world economy is in a process of continuous change . Thus , the emerging countries have succeeded in becoming much more integrated into the international division of labor . Meanwhile some of them have reached remarkable places in the ranking of competitiveness . For these and other problems we have to take a global view , as if the world is being analyzed from outer space

Main Body

Since 1970 the developing and emerging countries countries as a whole have succeeded in integrating themselves into the international division of labor . Their contribution to world trade has grown from 18 percent in 1975 to 29 percent in 1997 . Especially the emerging countries of Asia on the Pacific rim managed to realize high gains . They significantly increased the share of industry products in their exports , e .g Singapore from 34 percent (1965 ) to 84 percent (1996 . The world market share of the four `tigers (Hong Kong , Singapore , South Korea and Taiwan ) grew from approximately 3 percent in 1975 to approximately 10 percent in 1997 . In comparison , the African continent south of the Sahara , with a world market share below 2 percent , remains the poorhouse of the world for the time being

Asia 's economic miracle , so fashionable to discuss and cite as a success story , leaves something to be desired . To be sure , economic growth has flowed down from Japan to Hong Kong , Singapore , Taiwan , and South Korea then to Malaysia and Indonesia , and will ultimately flow to China and Vietnam . In a sense , the experience is similar to that in Europe and the United States , but much faster . It took the United States more than half a century , beginning in 1840 , to double per capita output . China , on the other hand , has managed to so in a decade after 1978 (Kortum , and Lerner 1997 : 24

Of course , Asian progress and economic growth are visible . Urban development , consumer products , and services appear to be sprouting all over the Asian landscape . It is , nevertheless , important to keep Asian development and progress in proper perspective . After all , China 's Gross Domestic Product (GDP ) is probably about one-half of Great Britain 's...