Guide Changing the Industrial Geography in Asia: The Impact of China and India

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CEPR Policy Research

Review of World Economics. The Rise of China and India: University of Chicago Press. Working Paper , Institute of Development Studies.

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Changing the Industrial Geography in Asia : The Impact of China and India

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Enter Heckscher and Ohlin

The focus of this volume is on China and India. The authors see them as the principal beneficiaries of the first upheaval, roughly bookended by the crises of and of , and as being among the prime movers whose economic footprints will expand most rapidly in the coming decades. If these two countries do come close to realizing their considerable ambitions, their neighbors in Asia and their trading partners throughout the world must be ready for major adjustments.

The changes in industrial geography and in the pattern of trade since the mids have already been far-reaching. Nothing on a comparable scale occurred during the preceding two decades of the 20th century.


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These developments offer instructive clues concerning the possible direction of changes in the future. However, in the interest of manageability, the author analysis is centered on the dynamics of industrialization, as these have a large bearing on the course of development.

Within this context, reference is made to trade, foreign direct investment, and the building of technological capabilities, which together constitute a major subset of the factors responsible for the shape not only of the industrial geography of the past but also of the industrial geography yet to come. The striking feature of development in South and East Asia in the second half of the 20th century is the degree to which Japan dominated the industrial landscape and how the Japanese model triggered the first wave of industrialization in four East Asian economies-the Republic of Korea; Taiwan, China; Hong Kong, China; and Singapore.

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These four so-called tiger economies were the early starters, and each has become a mature industrial economy. Nothing on a comparable scale occurred during the preceding two decades of the 20th century. These developments offer instructive clues concerning the possible direction of changes in the future. However, in the interest of manageability, the author analysis is centered on the dynamics of industrialization, as these have a large bearing on the course of development.

Within this context, reference is made to trade, foreign direct investment, and the building of technological capabilities, which together constitute a major subset of the factors responsible for the shape not only of the industrial geography of the past but also of the industrial geography yet to come.

The striking feature of development in South and East Asia in the second half of the 20th century is the degree to which Japan dominated the industrial landscape and how the Japanese model triggered the first wave of industrialization in four East Asian economies-the Republic of Korea; Taiwan, China; Hong Kong, China; and Singapore.