Asia Economic Systems of the World exam

A hydraulic empire

(also known as a hydraulic despotism, or water monopoly empire) is a social or government structure which maintains power and control through exclusive control over access to water. It arises through the need for flood control and irrigation, which requires central coordination and a specialized bureaucracy.[1]

Buddhism

1. Four Noble Truths: a. life is full of pain and suffering; b. causes of suffering are inappropriate desire and ignorance; c. to escape suffering, overcome desire and move to higher consciousness (nirvana); d. to pursue nirvana, follow disciplines of the Eightfold Path, seeking balance Found in: China, Mongolia, Burma, Thailand and Cambodia.

What are some of the factors holding back agricultural productivity in Africa?

1. Tribal communalism - insecure property rights with no legal title or protection. Continues to be a major system of tenure in many countries. 2. European private ownership 3. Gradual transition to African private ownership and to titling and protection of communal lands (see this chart) UPDATE: Many studies have demonstrated that effective land reforms can contribute to agricultural productivity and economic development. Unfortunately, in Zimbabwe and other African countries, land has been redistributed to political cronies, and has reduced access to skill and investment. See this article.

When did Japan experience its Bubble economy?

1985 -- Plaza Accord -- Japan accepts large appreciation of the yen, compensating for slow export growth with expansionary monetary policy. Easy money triggered speculative bubble economy, with rising real estate and stock prices.

Keiretsu

Created after WWII, these groups usually involve cross holdings of stock, interlocking directorates, presidents' clubs, and other cooperative arrangements.

Zaibatsu organization

Family-owned holding company controlled shares in a diversified group of industrial corporations, trading companies, and banks. After the war, American-written anti-trust legislation dissolved holding companies.

"For many years, Japanese society was organized in a hierarchy of family structures, with Japan, Inc. at the top." What purpose did these family structures serve?

Frequently, the familial relations in Japanese society are extended into the business world. The Japanese worker, for example, may become a member of a company "family"through a bond of lifetime employment. Furthermore, a company may engage in familial relationships with other companies by participating in a zaibatsu or keiretsu conglomerate. On an even broader level, the "Japan, Inc." thesis suggests that the entire economy is knit together under the leadership of a paternalistic government.

What happened to farming in 1978

Late 1978, return to reforms of early 1960s, and experimentation with system of contracting land and output quotas to individual households.

Hinduism

Lives full of suffering and pain. Accumulate record of spiritual understanding and action, or karma, to unite fully with Brahman. Requires more than a single lifetime, so reincarnation.Found Primarily in India and Nepal. But has spread throughout asia.

Who is included in the system of lifetime employment in Japan?

Male employees in larger corporations. About 25-30 percent of labor force. During the 1990s, the proportion of long-tenure (10-year plus) workers was 43% in Japan, compared to 26% in the U.S.

What ended the bubble economy?

May 1989 -- Bank of Japan shifts to more restrictive monetary stance, causing bubble to burst. During 1989-1996, real estate and stock prices both fell by about 50 percent.

What were the Meiji reforms? When did they happen?

Meiji reforms (1868) - Opened the door to foreign trade, equality of classes, eliminated feudal guilds, divided agricultural estates among the peasants, instituted monetary taxes, and established businesses and supported private industry through loans and subsidies. Growth continued until 1938 and World War II.

financial keiretsu

Mitsui, Mitsubishi, and Sumitomo, which were formed by regrouping former zaibatsus, plus Fuyo (or Fuji), Sanwa, and Dai-Ichi Kangyo—include manufacturing firms and also banks, insurance companies, and trading companies.

What is the #KuToo movement in Japan? What is the broader issue that this illustrates in Japanese culture?

The current controversy is the #KuToo movement, protesting rules that require women to wear high heels at work - even in some assembly-line jobs. Poor Status of Women- According to the 2020 World Economic Forum index, Japan currently ranks 121st in the world - behind China (106), India (112), and the United Arab Emirates (120) - in gender equality.

What was "The Great Divergence"?

When did Europe pull ahead of China and the rest of Asia in economic development? The "traditional" European view was that this happened quite early - maybe in the 1200s. A more recent "revisionist" view, promoted by scholars such as Kenneth Pomeranz, suggests that living standards were still similar in parts of China and the West until the 19th century. The most recent evidence suggests that the truth was somewhere in-between - China started falling behind in the 1300s-1400s, later than "traditionalists" and earlier than "revisionists."

production keiretsu

a large industrial concern and its subsidiaries and subcontractors, with tight, stable relationships, such as Toyota. Able to use just-in-time (kanban) system, shifting the inventory cost to subcontractors.

Agriculture first policy 1961-1965

a. Communes reduced in size to about 1,700 families. b. Incomes linked to performance of production teams and individuals according to work-point system. c. Families allowed to operate small private plots.

Results of colonialism in Africa

a. Focus on low-cost extraction of primary products. Each colony became dependent on exports of a small number of commodities. b. Transport routes were built for a single purpose—to move the products of mines and plantations to their external destinations. c. Dual pattern of export enclaves in the center, migrant labor in periphery. d. Political boundaries ignored African ethnicities; interrupted indigenous nation-building. e. Little attention devoted to education of Africans

advantages of the Lifetime employment system

a. Security and loyalty of workers who are covered. b. May contribute to adoption of technology because workers have little fear of technological unemployment and employers know their company will benefit from training.

Disadvantages to the lifetime employment system

a. To employers--redundant, incompetent, unmotivated workers retained, sometimes in meaningless jobs. b. To young employees--difficult to leave for a more attractive job. c. To older employees and workers not included in system-- greater job uncertainty. d. For these and other reasons, the conventional wisdom has suggested that the system was in decline, but recent (2015) research by Japanese authors suggests that it has changed very little while employment has grown more insecure in the U.S..

How does the share of intra-regional trade in Asia compare to that share for other regions of the world?

the share of intra-regional trade in Asia is now higher than in the Americas, and is far ahead of trade among African countries.

What was the major theme of our supplementary reading on Asia from Woetzel and Seong, and what is some of their evidence?

Asia is quickly becoming the World's largest market. By 2040 asia is likely to generate more than 50% of the world's GDP And could account for nearly 40% of the worlds consumption Today, the region has an increasing global share of trade, capital, people, knowledge, transport, culture, and resources.

What region of Africa has the lowest per-capita income?

Central Africa - dominated by D. R. Congo (former Zaire), has the lowest average income, but Gabon and Equatorial Guinea are relatively wealthy exceptions.

What challenge has the Gulf Cooperation faced in recent years?

Cooperation has been damaged since 2014 when Qatar was accused by the U.S. and other members of the GCC of allowing financers of the Muslim Brotherhood, Hamas, and other Islamist groups to live in its borders. In June 2017, Saudi Arabia (emboldened by its strong relationship with the Trump administration), Egypt, the UAE and Bahrain (but not Kuwait or Oman) claimed that Qatar was supporting terrorist groups, and cut diplomatic ties, closing borders and airspace, and imposing an economic blockade. In January 2021 (just as Trump was leaving office and just before a GCC summit), relations between the countries were restored - travel and trade resumed.

How has the population growth policy in China been changing?

Since 2015 - Two children allowed for all

How did the Slave Trade affect African Development?

Slavery (usually of conquered people/tribes) was practiced within several regions of Africa before the Europeans arrived, and was conducted with Europe and the Middle East for many years, but grew enormously after Americas were discovered in 1492, revealing a huge labor shortage in the Western Hemisphere. Native populations were decimated, creating labor shortages. Slaves first exported from Africa to the West Indies in 1510. Continued more than three centuries.

What region in Africa has the greatest access to electricity?

South Africa

What region in Africa has the highest income per-capita in Africa

Southern Africa - with mineral wealth and unique polity, this is the wealthiest region of Sub-Saharan Africa, led by Botswana, Republic of South Africa, and Namibia.

How does religious culture in Asia seem to differ from that in the Western world?

Asia is polythesitic and syncretism (merging or different religions) compared to western world.

Results of Slavery

Africa lost 23 million to the slave trade, including many of the healthiest, strongest, and most skilled workers and craftsmen. 3. The trade was abolished in England, the U.S., Holland, and France during the early 1800s. Sierra Leone and Liberia provided settlements for returning slaves. UPDATE: Nunn (2012) argues that the slave trade caused long-term and continuing harm to economic development, because it damaged trust within and between tribal groups, reducing cooperation and the effectiveness of local governments.

Why was deflation considered to be a problem in Japanese Context?

Along with deflation, the declining population in Japan (currently falling by 400,000 per year), caused by low fertility and marriage rates and unwillingness to accept foreign workers, have been considered major causes of declining economic growth.

How does language diversity in Africa compare to that in other regions of the world?

An enormous number of national, tribal, and colonial languages are spoken throughout Africa (see map). In Chad alone, 135 languages are spoken.

Leadership of Deng Xiaoping

Deng Xiaoping, who introduced moderate reforms in planning, agriculture, education, and other areas that foreshadowed the period after 1978. He visited the U.S., opened the country to trade, travel, and investment, and started the agricultural reforms.

How did the history of colonialism affect African Development?

During 1870s-1890s, all African territories except Ethiopia and Liberia divided into 23 colonial possessions, held by 7 European countries. Africans adopted languages and legal systems colonizers.

What is the "hydraulic theory of civilization"

Dynasties and Republics - Chinese civilization arose between 3000 and 2000 B.C. in Yellow River basin, and adherents to the "hydraulic theory of civilization" (following Karl Wittfogel) suggest that the need for large-scale irrigation required strong central institutions, leading to "oriental despotism."

What caused the bubble economy?

Early 1980s -- Japanese growth was discouraged by U.S. recession 1983-84 -U.S. recovers, Japan soars, but with trade imbalance.

What sub-regions within Asia have the highest and lowest levels of intra-regional trade?

Eastern Asia has the highest amount of intra-regional trade Central Asia has the lowest amount of Intra-regional trade

What are the major factors that led to china losing their advantage?

Excessive population growth Nature of Discovery Mongol domination Opium and Colonialism Bureaucracy Isolation

What demographic challenge is Japan facing, and what are its apparent causes

Growth in the quantity, working hours, and educational quality of labor were collectively the third largest source of growth. Much of this was the result of fortuitous demographic trends that cannot be duplicated.

Neoclassical analysis of the growth miracles

Neoclassical Washington Consensus view -- Asian growth supported by "market friendly" government policies, avoiding regulation of prices, interest rates, rents, and other payments, and by maintaining small budget deficits, stable monetary policies, low levels of foreign debt, and low barriers to internal and external trade.

Leadership of Xi Jinping

November 2012, while the U.S. was focused on the 2nd Obama election, Xi Jinping elected General Secretary of Communist Party and Chairman of Military Commission; March 2013, also elected President of the People's Republic. Started a consolidation of power and a renewed "cult of personality." November 2013, Xi claimed that "deepening reforms" would allow "market forces" to play a "decisive" role in allocating resources. However, as recently as 2018, industrial subsidies increased by 14% to $22 billion. That compares to a total of $3.2 billion during the four years from 2014-2017 in the U.S. These have been a major issue in continuing trade disputes, because subsidies were supposed to fall after Chinese entry into the WTO.

What is the nature of the "overseas Chinese" business network in Southeast Asia?

Overseas Chinese account for fewer than ten percent of S.E. Asians, but about 86 % of billionaires. Businesses earn about $450 billion annually—exceeded by national incomes of only ten countries in the world. Tend to be family owned, centrally controlled, individual firms typically are small- and medium-sized. Often based on ethnic clans. c. Importance grew during 1980s when China opened. Hong Kong and Taiwan account for 65 percent of China's total contracted investments. Much of investment going into regions of ancestral origin.

What is the "Belt and Road" initiative?What seems to be good about it, and what may be worrisome?

September 2013, During a visit to Kazakhstan, Xi announced the "Belt and Road" initiative, whereby China would engage in infrastructure development and investments in nearly 70 countries and international organizations in Asia, Europe, and Africa. Expanding economic and military power of China over a large area, but at high cost (loan defaults) and with charges of new colonialism.

What was the "Great Leap Forward"?

The Great Leap forward (1958-1965) A. Communes -- Large collective farms created under the Soviet model were merged into even larger People's Communes, which organized agriculture in teams and brigades and served as local government with schools, clinics. Private plots taken from families. B. Ambitious steel production targets -- Exported grain, needed for food, to buy equipment for small inefficient steel mills. C. Disastrous results -- Estimates of the number of "excess deaths" during this period range from 18 million to 56 million.

What were the Meiji Reforms significance?

The Meiji reforms drew Japan into the modern world and launched a period of rapid economic growth. The nation's emerging industrial and military power led to territorial gains in wars with China (1894-1895) and Russia (1904-1905) and in the First World War (1914-1918). An overvalued exchange rate caused Japanese economic growth to moderate during the 1920s despite an economic boom in the United States. On the other hand, the Japanese economy grew at a 6 percent annual rate between 1931 and 1938, despite a continuing depression in the West, because the government devalued the currency and pursued an expansionary program of military expenditures.

How can the mass diversity of languages be explained?

This may be explained, in part, by the geography of the continent and by historically limited transportation, but also by other tribal practices. Research by several scholars, looking across a broad cross-section of countries, has found a negative relationship between linguistic heterogeneity and economic development: "In our data, the 10% most diverse countries had an average per capita growth rate of a meager 0.54% over the period 1960-2004, whereas the 10% least diverse countries posted a much more sturdy figure of 2.59%." (Source: Klaus Desmet, Ignacio Ortuño-Ortín, and Romain Wacziarg, "The political economy of linguistic cleavages," Journal of Development Economics, 2012). Extreme linguistic diversity seems to stand in the way of cooperation, trade, and higher productivity.

What are some of the factors that may explain this "death by overwork" and what is being done about it?

Through the centuries, the Japanese people learned to compensate for their scarcity of natural resources: "We must work very hard" became their re frain, "we are a poor island nation." The Japanese work ethic grew ever more necessary after the carnage and destruction of World War II, and played a vital role in the postwar "miracle." The hero of the new era was the "corporate warrior." Recent efforts to moderate work ethic:Reduced the length of the standard legal workweek from 48 to 44, and then to 40 hours. Employees who work more hours are supposed to be paid overtime, and there's a legal cap on how many hours can be worked overtime. On the positive side, some firms are shifting to a 4-day work week to encourage employees to go home, and some are turning off their lights at night. In June 2018, the government passed a new labor law that limits overtime to 100 hours per month (a lot!), but included a loophole that allows white-collar workers to exempt themselves from that limit.

What does a Hydraulic theory of civilization suggest about Chinese culture.

Thus, it suggests that from the beginning, chinese culture has relied on a large central government who has lots of control.

Seniority pay

Wages are determined largely by the length of service of the employee. Reinforces employee interest in lifetime employment, but reduces employer interest. System is in decline. Less people want to apart of the system because the want the flexibility to change jobs

What countries are involved in the Gulf Cooperation Council, and what are its goals?

UAE Saudi Arabia Qatar Oman Kuwait Bahrain

According to Timur Kuran, what are some of the legal and institutional factors in the Middle East that slowed the rate of its economic development?

Under Islamic law, businesses were based on partnerships, which have no continuity, rather than corporations. So businesses had limited lives and didn't grow. Social services were/are provided by waqfs (trusts) with inflexible missions, set by their founders, perhaps centuries ago. Islamic laws of inheritance caused divisions of property, which probably was beneficial for social equality, but limited accumulations of wealth, compared to primogeniture in Europe, so Islamic businesses remained small. Islamic lending practices, with relatively strict limits on payment of interest, hindered the development of financial institutions.

How does the population growth policy of the present Chinese government differ from that of the Maoist regime?

Under Mao - 1949-1976 - large families encouraged, except that Liu Shaoqi encouraged 2-child families during the 1961-1965 pause. 1977-1980 - birth control campaigns aimed at 2-child families. 1980-2015 - The "One-Child Family" policy, which initially was enforced strictly and pretty horribly (forced abortions, etc, etc). There were loopholes for ethnic minorities, agricultural families, and pairs of only-children, so about half of households could eventually have 2-children.

Japanese Regional Network

While China is moving aggressively, Japan is still investing more heavily in infrastructure in Southeast Asia. Japan's infrastructure investment since the 2000s -- both completed and ongoing -- totaled about $230 billion, while that of China reached about $155 billion, according to BMI. Japan traditionally organized regional industrial policy according to flying geese formation.

What is of the Keiretsu system today?

While the old keiretsu system has yielded to foreign competition, other recent research suggests that a new, more flexible and competitive keiretsu system has arisen. "Over the past two decades Toyota's suppliers' association (kyohokai) has remained quite stable: From 1991 to 2011 fewer than 20 of about 200 companies withdrew. From 1991 to 2010 the average sales-dependence ratio (the revenue from Toyota-related business as a share of total revenue) of 44 of the company's suppliers has remained about 80%, even as Toyota has expanded its sourcing pool."

How is the lifetime employment system changing?

Women historically excluded--until recently, participation rate during early marriage dipped below 50%. It still dips, but not as deeply, and overall female participation has risen above U.S. levels:

Family responsibility or land contract system

actively promoted by government, beginning in 1981. Covered 98% of rural population within 3 years. a. Communal fields were divided into small family plots. Note: In some ways, this was a return to family farming that was practiced before 1949. b. Households contracted with production team to cultivate a tract of land in exchange for fixed quotas of certain agricultural products to the team at fixed prices. c. System modified in 1984-1985: communes abolished; land ownership transferred local villages and townships; allowable terms of the contractsextended to 15 years (30 years after 1995); household could transfer its contracted land to another household. d. System was big initial success, based on stronger incentives and more even distribution of labor effort over the land. e. By 1985, grain production returned to lower trend growth and then declined from 1998-2003. Largely caused by diversion of land from agriculture and from grain acreage to fruit and high-value crops (same happened in Japan and other heavily populated countries during industrialization). Since 2003, recovery of grain production explained largely by heavy investments in agriculture -- 6 trillion yuan ($930 billion) during 2003-2012, the highest level in China's history. f. Recent research by Chinese scholars at Zhejiang University and Stanford University suggests that inflexibilities in the Chinese system of land tenure have kept farm sizes very small (about 0.1 hectares or .25 acres), which limits their productivity and causes overuse of agricultural chemicals, causing "enormous damages to environmental quality and human health in China."

What region in Africa has the worst access to electricity?

central Africa

Have happened to farms in 1958

collectives merged into people's communes with 3,000-5,000 families, organized in production brigades and production teams. The commune served as the basic unit of local government, running schools, clinics, etc.

What is karo shi in Japan?

death by overwork

Christianity

dominant in Australia, New Zealand, Papua New Guinea, and the Philippines, and accounts for 29% of the population of South Korea. Found in: Australia, New Zealand, Papua New Guinea, and the philippines, and South Korea

distribution keiretsu

exclusive organization that moves products from manufacturers to consumers. Operating like networks of company-controlled auto dealerships in the United States, these are found in the automotive, cosmetic, electrical, and electronic sectors in Japan.

What were farms like in china 1953-1957?

small farms merged into Soviet-style collectives with average of 160 families.

What are the major goals of the Made in China 2025 Strategy?

government-supported development of technologies and production capabilities in high-priority sectors that include artificial intelligence, advanced robotics, electric cars and other new energy vehicles, 5G information technology, aerospace engineering, emerging bio-medicine, and others. That led to impressive advances, but also international concerns over: (1) compliance with international trade rules, (2) pressure on foreign companies to share their technologies, (3) international technological espionage (for example, Meng Wanzhou, the CFO of Huawei, China's largest private company, was arrested at in Canada in 2018 and accused of financial fraud and theft of trade secrets), (4) security concerns over including Chinese technology in telecommunications and other systems that are critical for national and global security.

Developmental states analysis of the growth "miracles"

industrial policies. World Bank, The East Asian Miracle: Economic Growth and Public Policy (1993), strong and intelligent bureaucracies contributed to growth. No broader evidence for industrial targeting.

What is "deflation" in the Japanese context?

is a general decline in prices for goods and services, typically associated with a contraction in the supply of money and credit in the economy. During deflation, the purchasing power of currency rises over time. Deflation started in 1999and has recurred during many years

Traditional Farming System in China

small-scale subsistence farming.