Export Oriented Industrialization In Developing Countries

Export Oriented Industrialization In Developing Countries One of the key indicators, of economic development of a country, is its level of industrialization. That is, as many empirical investigations proved the main reason for increased divergence in living standards between the advanced countries and the developing countries is their level of industrialization. This being the fact, it is only after decolonization and end of world War II that, developing countries consciously adopted industrialization strategies for economic development purposes and as a solution, from their vulnerable dependence on export of few primary products and import of high valued manufactured goods (Brisbane, 1980). The low terms of trade in international market for primary goods from former colonies and the determination to get out of severe poverty and register sustained growth, were the main reasons for the diversification of the narrow structure of the colonial economy. Industrialization is beneficial for developing countries for many reasons including the following (i) it reduces their vulnerable dependence; (ii) it speeds up their economic growth process; (iii) it modernize the economy through spill over or externalities effects associated with industrialization, from advanced countries; (iv) create more employment for the vast population in rural agricultural sector and accelerate income growth which is used as a means to re-distribute income to the impoverished masses; and (v) generate more foreign currency through export which reduces balance of payment problems (Brisbane, 1980). As Brisbane explained, to industrialize, developing countries adopted import substitution strategies from about 1945 to the 1970s. Import substitution strategy is designed to produce few luxury consumer goods for domestic consumption behind a very high tariff wall. However, most countries which followed the import substitution strategy failed, to meet the goal of industrialization, while spectacular growth and development was reported from developing countries that pursued an export oriented strategy, in the 1970s. Defined simply, export-oriented Industrialization (EOI) often termed as export led industrialization (ELI) is a policy designed for the purpose of speeding up the industrialization process of a country through exporting goods for which the nation has a comparative advantage. This policy requires countries to open up their domestic market to foreign competition in return to getting access to international market. In order to promote EOI and ultimately economic development, complementary policies in relation to tariffs, trade, exchange rate, and others need to be adopted and employed. This paper will critically examine how export oriented industrialization is essential for economic growth in developing countries, if it can be backed up by appropriate policies on trade, industrial policy and exchange rate policy, geared for that purpose. The paper also argues that export oriented industrialization has its own drawbacks. Thus, the essay is structured as follows: In section 2, It the paper analyses the significance of policies on the functioning of EOI, particularly: trade policy, industrial policy and exchange rate policy that developing countries need to adopt and identifies areas where government intervention is needed to bring economic development. It then explains the drawbacks of export oriented industrialization, on export dependence countries, in Section 3. Then section 4, empirically examines how EOI contributes to economic development and the conclusions are presented in section 5. 2. Significance of Policies on EOI The role of complementary policies for effectiveness of export oriented industrialization is undeniable. This paper focuses mainly on how trade, industrial and exchange rate policies can support EOI policy. 2.1 Trade policy: Appropriate trade policy is one of the key tools used for effective of export oriented industrialization and for economic development, in general. That is, the better trade policy a country has, the better chance it has for industrial diversification, creating value added products and getting more income from export. Theoretical context: Even if, there has been little consensus on the relationship between trade and short- to medium -term economic growth-and even less on its role in long term economic development. The principle of comparative advantage, which prescribe countries to specialize as to their factor endowment, first described by David Ricardo, forms the theoretical basis for traditional trade theory and provides the rationale for free trade. The principle states that even if a country produced all goods more cheaply than other countries, it would benefit by specializing in the export of its relatively cheapest good (or the good in which it has a comparative advantage)(Murray Gibbs 2007, p. 10). And some classical economists believed that the principal base for this principle is the difference in factor endowments among countries determine the relative cost of production. However, this traditional theory from classical economists has been challenged as it doesnt explain well the actual trade patterns and as the theory has unrealistic assumptions, like perfect competition, full employment etc (Murray Gibbs 2007). In addition to the unrealistic assumptions, in real situations the theory favors advanced countries, and developing countries hardly benefit anything from it. The controversial Singer Prebisch thesis, also explained this situation by stating that it is the center that gets all the benefits of international trade while the periphery gets nothing, which opposes to the Ricardian Theory of Comparative Advantage. He argued: given the differences in the existing economic, productive and labor market structures between the periphery and the center (in the application of technology in traded goods and in the market structures; oligopoly vs. competitive) less-developed countries cannot benefit from international market, if they adopt comparative advan tage doctrine (Todaro and Smith 2009).This is because developing countries usually produce and export primary products which have lower terms of trade. And the scope for diversification is too narrow, and these conditions put developing countries to have vulnerable dependence on international market. Thus, unlike the classical economists static comparative advantage doctrine, dynamic comparative advantage is a better option for developing countries. This is because as more innovation, technology, capital, and other requirements for industrializations are met and as industrialization happens in developing countries, it will be easier to diversify their economic structure, as manufactured goods have better terms of trade than primary products. Skarstein (2007) in his paper Free Trade: A Dead End for Underdeveloped Economies,criticized the comparative advantage doctrine. He argued, what matters most in international trade is the absolute advantage that countries get out of it than a comparative advantage. And empirical evidences show that the doctrines of comparative advantage and free trade benefit the advanced countries only. This is mainly because the doctrines are likely to exclude international learning among countries. Particularly, the WTO agreement, Trade related intellectual property rights (TRIPS), which is a big challenge developing countries to acquire technology, skill and international learning from the rest of the world. He also argued, for a trade policy to function effectively, developing countries have to make sure that, this policy is well integrated with their industrial policy. And in addition to these, developing countries have to get support from advanced countries, through reduced import tariffs for goods from developing countries and by giving developing countries a chance to protect their industries and to get easy access to international market. He also stressed that, developing countries have to ensure that food security is maintained in their countries, as it keeps them safe from their foreign account, balance of payment problems as well. Thus, governments of developing countries have to protect agricultural production for consumption. Therefore, while designing policies, developing countries have to consider the dynamic comparative advantage or absolute advantage options. In addition to this, they also have to consider how their economic integration to the world economy should be in support of EOI. 2.2 Industrial policy: A proper industrial policy is also another important tool for effective export oriented industrialization, as a countrys industrialization depends on how individual domestic firms are protected. This is because, it is individual firms that innovate and harness technological change and compete in the world market (Suranovic, 2002). The basic policy component of industrial policy for developing countries is Infant industry protection. It is a necessary condition, because newly emerging firms in developing countries need some policy to help them grow strong and to safeguard them from intrusion of foreign firms in their market, that have a negative effect on their growth. Infant industries in developing countries can mainly be protected through import tariff mechanism, which reduce imports from the rest of the world and raises demand and production of domestic product. This protection enables the domestic firms to cover their higher production costs and to remain in business. Depending on the nature of the firm, infant industry protection strategy will help the domestic firms to produce efficiently and to be competent in international markets. However, in order to use the infant industry protection policy as a tool for export oriented industrialization, government of developing countries need to have reliable information about what industry to protect, how large the production tariffs need to be and over what period the tariffs will be reduced and eliminated. Because import tariffs have to be gradually reduced and eliminated, to increase efficiency of domestic firms. A complementary policy component to infant industry protection in export oriented industrialization is export promotion. This component stimulates export and allows the infant industry to have access to international market, while Infant industry protection policy allows the new domestic firm to grow strong. For industrial policy to be effective it has to be complemented by competition policy, as some regulations are required for the competition among domestic firms and simultaneously, as there is a need for policy to protect the domestic firms from intrusion of foreign firms in their market. A coherent execution of industrial policy requires a coordinated approach to trade policies. This is because trade policies are designed usually in accordance with a countrys trade negotiations, which include: policies related to investment, tariff, Intellectual property, and others. The effectiveness of tariffs as a tool for industrialization is also linked to the monetary policy framework within which it operates. When the capital account is liberalized control over exchange rates may be lost and the appreciation of exchange rates can obviously undermine export competitiveness and the impact of tariff protection (Murray Gibbs 2007, p. 19). 2.3. Exchange rate policy: The role of exchange rate policy in the success of export oriented industrialization strategy is undeniable. Exchange rate is a policy on the level of exchange rate of a countrys currency. The main challenge in formulating the exchange rate policy is in keeping balance between maintaining exchange rate stability and maintaining export price competitiveness, which requires devaluation. Devaluation increases the value of imports, while it gives options for exporters to choose either to reduce the prices of their products or to keep them as they are, to increase their profit margin. Thus, devaluation, at a cost of higher inflation, enables domestic industries to be competent internationally, by keeping the volume of import down and by raising the volume of export (domestic output) higher. The role of government in controlling inflation, to stabilize the economy is very essential, here. Thus, this phenomenon in addition to supporting the export oriented industrialization process it helps countries to improve their current account balance in Balance of payment problem (Jacob, Atta ; Keith R., Jefferis ; Ita, Mannathoko and Pelani, Siwawa-Ndai 2000) 3. Drawbacks of Export dependence A country is dependent on export, if export constitutes the largest portion of its gross domestic products. However, even if EOI strategy contributes for economic development, the extent to which this strategy is applied has to be considered for various reasons. To mention some of them, as dependency theorists argue: first, export dependent developing countries cause chaos on the long-term economic planning capacity of a nation-state (Barratt-Brown Prebisch) as these countries have little or no control over the market, to allow sustained economic growth through stable revenue. Second, Income from export is not a reliable source for economic development for developing countries. As many of the export oriented industrializations in these countries are owned by multinational corporations, and large portion of revenue from such sources are not repatriated, to be used for re-investment (Jaffee, 1985). 4. Empirical evidence: Skarstein, 2007 paper Free Trade: A Dead End for Underdeveloped Economies, showed the empirical evidences on EOIs contribution for miraculous economic development of the Asian tigers and the now developed countries. It mainly showed the relationship between economic development and effective implementation of infant industries protection policy and export promotion policy. In support of this, it is argued, that many people have argued that Infant industry protection was precisely the industrial development strategy that was pursued by countries like the US and Germany during their rapid industrial development before the turn of the 20th century. Both the US and Germany had high tariffs during their industrial revolution periods. These tariffs helped protect fledgling industries from competition with more efficient firms in Britain and may have been the necessary requirement to stimulate economic growth (Suranovic 2002) Bairoch also analyzed data and concluded that the different the effect of free trade on developed and developing countries is. In all the cases he analyzed, free trade has a positive effect on developed countries while it lets the least developed countries to suffer. He mentioned that United Kingdom registered its fastest growth during the period (1860 1880). In those cases he analyzed, how effective import tariffs for developing countries were in their economic development (Bairoch, 1972, p. 211). In his paper, Skarstein, illustrated, with detailed data how the East Asian tigers used industrialization policy for their economic development. That is: first by implementing a policy of protected import substitution and then, as their industries grow competent, by shifting their industrialization strategy to export oriented industrialization, with a slow reduction of import barriers for industrial good. And, at the same time, how implementing high import protection for their agriculture helped them to maintain food security and helped their success in industrialization The miraculous performance of the East and South East Asian countries during 1970s to 1990s cannot be analyzed without considering the connection between the export -oriented policies and economic growth. In the Newly Industrialized Economies from East and South East Asia, the general macroeconomic policies as well as selective export promotion policies facilitated the high export and economic growth. Following their path China and India also changed their policy stance in favor of export oriented policies and moved on the high growth trajectories. 5. Conclusions: In sum industrialization is a key process for developing countries for economic development. However, as many economists agree, the process of economic development is very complex, as it depends on large number of variables such as political system, socio economic structure, capital accumulation (both physical and human), trade, price fluctuations, and income distribution, and even more on geographical characteristics. As such, while export oriented industrialization contributes to economic growth, it is not necessarily indispensable to the growth and development of developing countries. As explained in this essay, EOI can be one of the key strategies to register economic growth. And in order for it to function effectively it has to be supported by appropriate components of the policy like: infant industry protection strategy, competition policy, export promotion strategy and others. More specifically, it requires well functioning and well integrated macroeconomic policies like: trade policy, industrial policy, exchange rate policy, investment policy, tariff policy and others. Government intervention also plays a key role in making the export oriented industrialization effective for economic development. Examined empirical evidences also reveal that Export-oriented Industrialization was particularly the characteristic of the economic development of the Asian Tigers: Hong Kong, South Korea, Taiwan and Singapore in the post World War II period . In addition to Asian Tigers, evidences also tell how EOI strategy contributed for the economic development of US, Germany and others, who are now in developed world category. However, though the role of export oriented industrialization in economic development is undeniable, countries have to also carefully consider its share in the gross domestic product, as larger export dependence has a negative effect on economic growth.

Britney Spears - A Woman I Admire Essay -- essays research papers

There are many women that have an impact on my life; however, the question is how many of them do I look up to? Of course the most obvious person is my very own mother, but that made me think who else deserves to join this circle of reverence. Some names entered my mind, but do I really admire them? It is clear that women that enter my daily life like Oprah Winfrey have an impression on me, but impact and admiration do not always go hand in hand. Then I realized who I really admire: Britney Spears. The teen pop idol singer Britney Spears is a woman that I look up to for many reasons. She has tantalized the entire world's youth with her incredible voice. By doing so, she serves as a role model for many of the young people growing up in today's society. Although Britney is only 19, she al...

picasso :: essays research papers

  Ã‚  Ã‚  Ã‚  Ã‚  Pablo Picasso , known as one of the most influential artists of the twentieth century . I shall explore the evolution of a young Pablo Ruiz Picasso to the experienced genius that had shaped the way we see art today . From his Blue and Rose periods through the birth of Cubism , to the struggles of the experimental thirties . As we go to the death of a proud father .   Ã‚  Ã‚  Ã‚  Ã‚  Picasso was born in Malaga on the 25th of October 1881 . The only children of the family were Pablo and his younger sister . As you know Spaniards take the name of one’s father and of one’s mother . The name Ruiz was his father’s . His mother’s was Picasso . His birth name is Pablo Ruiz Picasso . Since its such a long name its a pain to sign so he shortened it . On Pablo’s earlier canvases he signed Pablo Ruiz but later changed his name to who we know of now , Pablo Picasso . Picasso is of Italian origin and the Picasso were silversmiths . Physically Pablo resembles his mother , small and robust with a vigorous body , dark-skinned , straight not very fine black hair . Picasso used to always say that his father was like an English-man . His father , Josà © Ruiz Blasco was tall and had reddish hair and an English way of carrying himself .   Ã‚  Ã‚  Ã‚  Ã‚  As a child Picasso was making drawings , not the drawings of a child would have but one a painter would have painted . When he was fifteen years old he would make oil portraits of his younger sister . He painted like a born painter . Then at age nineteen Picasso was off to Paris . Two months later he went back to Barcelona sold some paintings . Picasso settled in Madrid and starts the magazine â€Å" Arte Joven â€Å" with the writer Francisco de Assis Saler. Soon after Picasso goes back to Barcelona and then back to Paris again . Picasso had friends but none of where painters , no they were all writers .   Ã‚  Ã‚  Ã‚  Ã‚  In 1902 Picasso returned to Spain and painting in his Blue period . Being in away from Spain for a while he forgot how colorless it is . The colors of Spain are white , black , silver and gold yet it was still beautiful . Span in a sense is not like other southern countries ,

Britain of evacuation in World War Two Essay

During the course of World War Two, many people were evacuated, not just children. There were many differing reactions to evacuation. The reaction would depend on the experience you had. Reactions would also change over time during the war and even after the war had finished. One set of people affected by Evacuation was the Children. Many children did not know where they were going and therefore experienced feelings of fear and anger. The children disliked being separated from their parents but put on brave faces so not worry their families. When the children arrived at their destination, they were taken to school halls of town meeting places where the were chosen by their â€Å"foster† families, which they disliked because often they were split from their sisters and brothers. If they had negative attitudes, they very often did not settle quickly like those who had positive attitudes and would see their stay as a holiday. If an evacuee had a positive experience, they would have pleasant memories of being treated as one of the family. Evacuation was described as â€Å"no better than a ‘paedophile’s charter’ † as it would have been easier to abuse children away from home. However, in a study of 450 ex-evacuees, only 12% of them had bad experiences. Michael Caine remembers being evacuated with his brother Clarence. He said † My brother used to went the bed when he was nervous. My foster mother could not figure out who it was so she beat both of us, and Clarence became more nervous and wet the bed more. † However, not all experiences were bad. On ex-evacuees remembers being given clothes when he was evacuated. A child’s reaction to evacuation would depend on their experiences while in care. Another set of people who were affected by evacuation was the children’s parents. Most parents were reluctant to send their children away but agreed because of propaganda. Not all parents sent their children away though. Some parents thought that their children were safe in their family home. However, most parents brought their children home due to the ‘phoney ‘ war. But the children were evacuated again when the Blitz happened, although the scale of evacuation was not as large as the first wave in September 1939. Thanks to the Blitz, many parents changed their opinions on evacuation, now agreeing that it was probably best for their children.

Odysseus: Selfish Hero.

Morgan Kraft Period 2 October 11, 2011 1st Quarter Essay Jack Sparrow is a selfish hero. He thinks of himself most, but he truely cares for his men. He relates to Odysseus in that manner. Odysseus is also a selfish hero, but a hero all the same. This is proven by his courage, his cleverness, and his caring nature. Odysseus is a hero because of his courage. This is shown on many occasions including in the episode with the Cyclops. Homer, in his epic poem The Odyssey describes how Odysseus â€Å"rammed it [the spike] deep in his crater eye† (Homer 692).This is courageous because the Cyclops could have killed him pretty easily and there are many ways it could have gone wrong, yet he did it anyway. Another example is when he enters the Land of the Dead. His courage is expresses through the following: â€Å"and I grew sick with fear. But presently I gave command to my officers to flay those sheep the bronze cut down, and make burnt offerings of flesh to the gods below† (Home r 701). Odysseus had no clue what could have happened to him there, but he knew to make it home he had to, even though he was scared.Listening to the Sirens song was a noble act as well, for the reason that he could have found a way to untie himself, but he knew he had to listen because of Circe’s warning of â€Å"the dangers he will face: the Sirens, who lure sailors to their destruction† (Homer 705). In the cases of the Cyclops, underworld, and Sirens Odysseus showed great bravery therefore he is a hero. Another of Odysseus’s heroic traits is his cleverness. Proof of his wit is seen when he tells the Polythemus â€Å"My name is Nohbdy: mother, father, and friends, everyone calls me Nohbdy. (Homer 692). This shows that he has the ability to think ahead in difficult situations and not let his head get clouded. Yet another example is when he â€Å"slung a man under the middle one [sheep] to ride there safely† (Homer 694). This demonstrates his knowledge o f whom he is around. Odysseus knew that the Cyclops was a shepherd and he had to let his sheep out everyday. One final example of Odysseus’s cleverness is shown when he â€Å"laid it [beeswax] thick on their [shipmates] ears† (Homer 706).This is clever because his men can't hear the melodious voices of the Sirens. This indicates that his wit makes him a hero. A final, but not only other, heroic trait Odysseus wields is his care. Proof of this is shown while on the island of the Lotus-Eaters when he fought to bring his men back to the ship. In this episode Homer writes as Odysseus, â€Å"I drove them, all three wailing, to the ships, tied them down under their rowing benches† (Homer 685).This is caring because some captains would just say, â€Å"forget it†, and leave them. More proof is shown when he has his men tie him to the mast of the ship and listen to the sirens. â€Å"yet she urged that I alone should listen to their [the Sirens] song† (Homer 705). The care in this is the fact that he sacrificed part of his sanity so that his men would be able to get past the Sirens. One more act of his care is shown when he grieves for the loss of his men, time and time again.An example of this is when he sees Elpenor in the Hades realm, â€Å"Now when I saw him there I wept for pity† (Homer 701). This shows he is not completely selfish and that he actually feels bad every time a man dies on his watch. Henceforth, Odysseus's care proves he is a hero. To end, the heroic traits Odysseus has are courage, wit, and care. And these traits prove what a true hero Odysseus truely is. Yes, he may be selfish like Jack Sparrow, but he is still a hero. So, with this how many of today's so called â€Å"heros† actually are?

Frankenstein and Bladerunner Essay

How do Frankenstein and Bladerunner reflect their Composers context? Mary Shelley’s Gothic Romantic novel Frankenstein and Ridley Scott’s Science Fictions Noir film Blade Runner both explore similar ideas however relative to the context in which they were both made. Both Scott and Shelley use their texts as a cautionary tale, warning humanity of their inevitable downfall through greed and the exploitation of nature, and the influence science is slowly obtaining over the role of religion. Through the use of visual and auditory techniques, Scott demonstrates how nature and religion are absent in a world overrun by consumerism and technology while Shelley similarly uses imagery and allusions to hint at the consequences humanity will suffer if they try to better God through the misuse of science and the exploitation and nature. Humanity’s rejection of the natural world in favour of the unnatural pursuit of technology to prolong life is a major concern in both Shelley’s Frankenstein and Scott’s Blade Runner. In the world of Frankenstein, nature is an important aspect of a person’s life and beliefs. Shelley conveys Victor’s desire to conquer nature through the use of his narration such as â€Å"new species would bless me as its creator†¦many happy and excellent natures would owe their being to me. † The monster is then used as a metaphor for the inevitable consequences of the exploitations of nature. She therefore uses Frankenstein as a warning against the rising industrial revolution. Similarly Scott uses Blade Runner to warn society against the exploitation or nature through the rise of consumerism in the 1980s. The long shot of a dark dystopian Los Angeles after the opening credits juxtaposed with jets of fire from oil refinery towers warns the viewer of the consequences of consumerism through the exploitation of nature. There is also a lack of natural imagery such as plants and animals seen in Blade Runner and the use of chiaroscuro lighting gives the world a very artificial tone indicating to the audience that nature has been destroyed.

Network Environment Management Essay Example | Topics and Well Written Essays - 5000 words

Network Environment Management - Essay Example For instance, finance data must be protected and only be accessible to the finance staff. For this purpose, an authentication mechanism i.e. Microsoft Active Directory is implemented. Microsoft Active directory will enable West Products to centralize data in one location and facilitate in audit functions. Moreover, for protecting unauthorized access, audit trails, user account logs are generated. For security aspect, active directory restricts the user from windows components, data sources, and the Internet. To add extra layer for protecting unauthorized access by the internal as well as external employees, Virtual LAN is implemented. The VLAN will divide the departments logically by separate addresses. For instance, Finance department data will not be intermixed with Sales data. For redundant Internet connections, Service Level Agreement (SLA) is established with Internet Service Provider. 2 Introduction The computer networks involved thousands of elements, a variety of devices and protocols, including interactions and relationships between components therefore enhanced network management for large scale systems has developed. In addition, the network has to fully informative and must contain effective management tools in order to make sure efficient and trouble free operations. Now days, non-integrated tools are used for the usual enterprise wide network management. These tools provides incomplete and limited outlook of the network and the management necessities. For this reason, significant problems arise that effect the management techniques. There is a requirement for a Network Management, Analysis and Testing Environment for achieving unified and inclusive software environment that helps to supervise and orchestrate the operations of the devices and protocols within the network management systems. The network management environment management represents the tools that provide knowledge regarding the management techniques. Moreover, effective deployment of the model resolves various network difficulties. The functional behavior of the network objects are confined and distributed equally. For instance, the distribution process and maintenance of data structures via multiple switches and network controls are involved in a virtual-circuit X.25 network. These distributed objects are significantly examined by the individual devices. Therefore, essential data must be handled by this model facility. Likewise, in a multi layered protocol, the behaviors of the network objects and the behavior of an individual layer are extremely correlated. For instance, a telnet session highly depends on the transport-layer (TCP) and network-layer (IP) functions in TCP/IP protocol suite. As a result, the network level connections failure may lead to the failure in the upper layers. This is represented by the network model as the interpretation of correlated behaviors. On the contrary, the statically configurations do not capture all the correlated behavior c hanges as, much correlation are the result of the vibrant interactions between the objects. 3 Proposed Solution for West Products The proposed solution for West products requires a synchronized active directory services along with all the 3 branches including the head office. As shown in fig 1.1, the branches are equipped with an active directory site that is synchronized with all the other sites and the domain