Economic Development and Economic Catch-Up. Two different models of economic development. Agrarian Epoch . Economy engaging in agriculture with low degree of social division of labor. Per capita GDP lingering around subsistence level. Absolute poverty. Epoch of Modern Growth(Kuznets).
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Two different models of economic development
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Table : Trend of world per capita GDP and population
In 1990 International Geary-Khamis Dollars
# Angus Maddison 2010
Trend of World Per Capita GDP - Graph
per capita income (in thousand)
US$30.- low growth rate
high growth rate
US$1.- no growth
0 agrarian transition post-industrial T
- CENTER : Group of industrialized countries
- PERIPHERY : Agrarian countries
Import Substituting Industrialization.
- Export-oriented growth of South Korea and Taiwan was successful, while import-substituting Latin America failed.
- Japan, South Korea, Taiwan, and Singapore were authoritarian, with tight regulations.
- Only colonial Hong Kong was liberal!
★Corruption (Rent-seeking) problem
(1) Protection of property right
(2) Enforcement of contract
(3) Fair dispute resolution mechanism.