GEOG 1001 Quiz: Asia, Latin America - Global Economy Study Guide

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George Washington University
GEOG 1001
Lisa Benton- Short

Asia Rising: Japan, Asian Tigers, China and India Identify the Asian Tigers and describe their emergence as newly industrializing LDCs in the 1980s and 90s; use statistics to show their economic growth. The Asian Tigers are Malaysia, Thailand, Hong Kong, Singapore, Taiwan, South Korea, and Indonesia. Though in the 1950s and 60s they didn’t have many natural resources, were recovering from war, had a reputation for shoddy goods, and were far away from major markets, they were able to see rapid growth and reduced inequality. The region’s GDP grew on average of 5% annually. Explain reasons for the success of Japan and the Asian Tigers. These nations were very successful due to their cultural values and government/business relationships. They had strong Confucian beliefs, in which everyone understood and accepted their position in the societal hierarchy. Asians also placed a huge value on education and valued sacrifice. The state was also much more involved in the economy, so the government could make rules to control the production and imports in the country (ex. Tariffs, channeling money to certain sectors). Detail the protectionist policies of Japan and the Asian Tigers. To increase the consumption of Japanese goods and reduce foreign competition in their own country, Japan placed heavy restrictions on imports like tariffs. Because of this, Japanese goods became much more popular in Japan, and the US and Europe were unable to tap into the Japanese market. Discuss the role of Japan in stimulating economic growth in the Asian Tigers. Japan’s growing economy allowed it to dominate the world, and it passed on its model for economic success to the Asian Tigers. It also increased foreign direct investment in these nations, providing it with more capital to improve GDP and economies. Discuss the weaknesses that led to the 1997 Asian financial crisis. Japan didn’t remove the protectionist policies even after its economy improved immensely, which created tension between them and western countries, like the United States and European nations. Along with the Asian tigers, they had some government shadiness, in which they didn’t inform people completely about what was going on in the economy. This caused distrust among commoners in these countries. Since there was a rapid inflow of FDI and loans for short-term projects, the country wasn’t able to pay it back in time. There was also cronyism in the banking system in which bankers lent money to friends, not necessarily based on merit. Identify the ways in which China has risen as a new economic power in the global economy; use statistics to show economic growth. Some factors that contributed to China’s rise as a new economic power in the global economy are its abundance of natural resources and its Soviet style economy/government. In 1979, China implemented its one child policy, which slowed down population growth and increased spending capacity of population, and China started to move away from the Soviet-inspired “collectivized” agriculture, putting the nation on a path towards a more capitalistic economy. In the 70s, China also implemented the Open Door Policy in which they welcomed foreign investors and multinational corporations. In 1981, China started an age of modernization reforms, in which they had free enterprise controlled by government, so they devalued their currency, making wage of labor decrease drastically, encouraging foreign companies to move labor to China. For the past twenty years, China’s GDP has been growing at an average rate of 10%, while the US GDP has been growing at about 2% annually. China also used to account for only 1% of the global exports and today it is the most popular destination for FDI and it is the second largest economy in the world, surpassing Germany. Schaeffer ascribes China’s succes
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