Browse by title

You are looking at 1 - 10 of 320 items :

  • Asian Business x
  • Asian Economics x
Clear All
This content is available to you

Shahid Yusuf

You do not have access to this content

Shahid Yusuf

China’s Global Economic Footprint is large and growing. In recent years, China has contributed a third or more to the growth of the global economy following its meteoric rise starting in the 1980s and gathering momentum in the 1990s. China has convincingly demonstrated the efficacy of investment and export-led growth as a model of development and has achieved economic stardom using a mix of industrial, trade and exchange rate policies within the framework of a gradually reforming socialist market economy. This Research Review explores China’s economy and will be an invaluable resource for China watchers and researchers, students and policymakers interested in learning from East Asia’s development, understanding how China transformed its economy and exploring how China might come to grips with the challenges ahead.
You do not have access to this content

Shahid Yusuf

You do not have access to this content

Shahid Yusuf

You do not have access to this content

Shahid Yusuf

You do not have access to this content

The classical origins of Akamatsu’s ideas: a missing link to David Hume’s ‘flying-manufacturers’ theory

The ‘Flying-Geese’ Theory of Multinational Corporations and Structural Transformation

Terutomo Ozawa

This chapter examines some important classical origins of Akamatsu’s ideas. While studying in Germany in 1924_26, Akamatsu was strongly influenced by a variety of the stages theories of development expounded by the German Historical School. As he himself acknowledged, ‘his’ idea of the infant-industry protection-driven, three-step sequence of import, domestic production, and export was directly borrowed from Friedrich List’s (1885/1966) book, The National System of Political Economy. However, why did Akamatsu fail to notice what may be called the ‘flying-manufacturers’ theory advanced by David Hume (1754/1985), a theory that no doubt adumbrated Akamatsu’s ‘flying-geese’ theory? This is probably because the German Historical School that stressed inductive reasoning and empiricism was at loggerheads with the British Classical School that by sharp contrast pursued deductive reasoning in search of universal abstract theories. Consequently, Akamatsu must have been blindsided by the German Historical School, missing a chance to read Hume’s writings. References: Hume, David (1754/1985), Essays: Moral, Political and Literary, ed. Eugene Miller, Indianapolis, IN: Liberty Fund. List, Friedrich (1885/1966), The National System of Political Economy, New York: Augustus M. Kelly Publishers.

You do not have access to this content

The dynamics of MNC-impacted comparative advantage: relevance to Ricardo’s view on FDI and Samuelson’s skepticism about globalization

The ‘Flying-Geese’ Theory of Multinational Corporations and Structural Transformation

Terutomo Ozawa

The notion of ‘pro-trade’ versus ‘anti-trade’ foreign direct investment (FDI) was conceptualized by Professor Kiyoshi Kojima (1921_2010) and theoretically formalized in an article in The Hitotsubashi Journal of Economics (Kojima and Ozawa, 1984a/1993; reproduced in the United Nations Library on Transnational Corporations, Vol. 8). The core idea is that multinational corporations’ (MNCs) overseas investments in emerging markets have two opposing effects on the basis for trade: one is to expand comparative advantage (that is, a pro-trade effect), and the other is to reduce comparative advantage (that is, an anti-trade effect). The pro-trade type of FDI is central to a successful ‘flying-geese’ formation. Furthermore, the above theoretical distinction helps clarify both David Ricardo’s (1817) pessimism about the welfare effect of cross-border investment on the home country and Paul Samuelson’s (2004) skepticism of the long-term benefit of free trade to the United States in an age of globalization. References: Kojima, Kiyoshi and Terutomo Ozawa (1984a/1993), ‘Micro- and Macro-Economic Models of Direct Foreign Investment: Toward a Synthesis’, Hitotsubashi Journal of Economics, 25 (1), 1–20. Reproduced in Gray, H. Peter and John H. Dunning (eds) (1993), Transnational Corporations and International Trade and Payments, Vol. 8 of United Nations Library on Transnational Corporations, London: Routledge. Ricardo, David (1817/1888), ‘Principles of Political Economy and Taxation’, in J.R. McClulloch (ed.), The Works of David Ricardo, London: John Murray. Samuelson, Paul A. (2004), ‘Where Ricardo and Mill Rebut and Confirm Arguments of Mainstream Economists Supporting Globalization’, Journal of Economic Perspectives, 18 (3), 135–46.

You do not have access to this content

The Evolution of the World Economy

The ‘Flying-Geese’ Theory of Multinational Corporations and Structural Transformation

Terutomo Ozawa

The world economy is near a critical crossroads, as a rising China, the greatest-ever beneficiary of US-led capitalism, ironically dreams big to replace America's supremacy as a new hegemonic power with a non-liberal world order. This third volume of the trilogy on ‘flying-geese’ theory reformulation explains how capitalism has changed industrial structures across the world. Using structural development economics and political economy analytics the unfolding changes in the global industrial landscape are examined in depth. Will the ‘flying-geese’ formation survive the formation that has produced the East Asian miracle and is hoped to spread to Africa?
You do not have access to this content

The ladder of economic development revisited – and elaborated

The ‘Flying-Geese’ Theory of Multinational Corporations and Structural Transformation

Terutomo Ozawa

The nebulous notion of the ladder of economic development has been defined in terms of a stages-delineated framework á la Schumpeter, consisting of, so far, five stages or rungs (labor-driven, resources-processing, assembly-based, research and development-driven, and information and communication technology -enabled industries) plus an inchoate stage of green and health technology-based growth presently in the making. The first and second rungs (that is, labor-intensive manufacturing and heavy and chemical industries) were developed under Pax Britannica with its strategy of ethnocentric industrialization and ‘kicking away the ladder’ from emerging economies. In contrast, the higher (third through sixth) rungs have come into existence under Pax Americana that has been spreading mass consumerism and ‘providing the ladder’ to the emerging world, for business- and ideology-motivated reasons. In addition to the inter-industry ratcheting-up progression, an intra-industry side-ladder is conceptualized for each rung of inter-industry ladder. This is where cross-border supply chains are embedded to exploit both the ‘endowed’ and the ‘created’ advantages of constituent economies. In the Appendices to Chapter 3, the role of MNCs in industrial take-off and sustained growth is discussed by reproducing three short essays published in the Columbia FDI Perspectives series.

You do not have access to this content

The next great industrial transmigration: relocating China’s factories to sub-Saharan Africa, flying-geese style?

The ‘Flying-Geese’ Theory of Multinational Corporations and Structural Transformation

Terutomo Ozawa

China has emerged as the most proactive partner for Africa’s growth by providing economic aid, investing in infrastructure and resource development, expanding trade, and most recently, stepping up local manufacturing. China’s growing industrial base in sub-Saharan Africa (which the World Bank would like to see further expanded as an industrial kick-starter) is now a subject of international attention. China has begun to graduate from, and relocate both inside and outside the country, low-wage manufacturing as it strives to move up the ladder of economic development. Will Chinese manufacturing investments in Africa rise on so massive a scale and in so expeditious a manner as East Asia has experienced, triggering a string of growth spurts from one catching-up economy to another, a phenomenon the World Bank called ‘East Asian Miracle’? The current debate on the issue often misses or does not sufficiently consider China-side factors. Although China’s recently retooled strategy has started to make some impact on sub-Saharan Africa, the present scope of, and the future prospects for, China’s industrial transplantation are still limited and constrained. All in all, a hoped-for African Miracle appears still a long way off.