Emerging Markets and the Future of the BRIC Nations

Emerging Markets and the Future of the BRIC Nations

New Horizons in International Business series

Edited by Ben L. Kedia and Kelly Aceto

After a decade of unprecedented growth, the BRIC nations’ economies have unexpectedly slowed. In this innovative book, expert contributors diagnose and examine the factors that might be responsible for the economic regression in Brazil, Russia, India, and China.

Chapter 1: Forging ahead with innovation: the importance of institutions and factor markets to the continued development of the BRICS

Ben L. Kedia, Rama Krishna Reddy and Tsvetomira V. Bilgili

Subjects: business and management, international business


Over the next 50 years, Brazil, Russia, India and China – the BRIC economies – could become a much larger force in the world economy. We map out GDP growth, income per capita and currency movements in the BRIC economies until 2050. The results are startling. If things go right, in less than 40 years, the BRIC economies together could be larger than the G6 in US dollar terms. By 2025 they could account for over half the size of the G6. Of the current G6, only the US and Japan may be among the six largest economies in US dollar terms in 2050. (Wilson and Purushothaman, 2003: 1) No idea has done more to muddle thinking about the global economy than that of the BRIC. Other than being the largest economies in their respective regions, the big four emerging markets never had much in common. They generate growth in different and often competing ways – Brazil and Russia, for example, are major energy producers that benefit from high energy prices, whereas India, as a major energy consumer, suffers from them. Except in highly unusual circumstances, such as those of the last decade, they are unlikely to grow in unison. (Sharma, 2012a: 4)