MULT-UB 11 Lecture Notes - Lecture 3: Import Substitution Industrialization, Comparative Advantage, Foreign Exchange Controls
4 Feb 2020
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Examples: hollywood, hudson yards, silicon valley, 5th avenue etc. Number of companies in the same industry located in the same area/region. Def: a geographically proximate group of interconnected companies and associated institutions in a particular field, linked by commonalities and complementarities. The geographic scope of clusters: ranges from a region, a state, or even a single city to span nearby or neighboring countries, relates to the distance over which informational, transactional, incentive, and other efficiencies occur. We have seen clusters move geographically over time: example: scotch whiskey, swiss watches, examples: regions in china that only produce floor lamps and other regions in. Nyc: because they expect their factor costs to be paid off. Performance growth rates (x1: gnp: 1954-71: cagr = 10% gnp/cap. Inflation (x8) all commodities 1956 = 99. 6 (index) 1971 = 110. 5. Strategy: combining import substitution with indicative planning, export requirements to encourage efficiency and earning foreign exchange and mainly internal financing.
