Introduction – Social Impact Of Economic Change
The striking growth performance of the Asia’s economy has attracted interests from researchers and policy makers. For a long period of time, the whole region has experienced increased growth even particularly in the newly industrialized economies and China to be precise. The number of people living in abject poverty in Asia decreased drastically between 1981 and 2001 whereby in China alone, this number dropped by more than 400 million. Additionally, the presence of early and late developers has indicated that Asia as a region has displayed disparities in per capita income that ranges from $33,0000 in Singapore to $2,000 in Bangladesh (Chew 2015, Hale 2015). Social Impact Of Economic Change.
In the region, China has recorded a high growth rate and it is ranked as the second largest economy globally after the United States. This nature of economic growth was experienced by Japan in 1980s and 1990s to the extent that at this time period, Japan was ranked as the largest globally. However, the Japan’s economy went through a pattern of economic growth, bubble- burst, and deflation (Caballero, Takeo and Kashyap 2008, Hayashi and Prescott 2002). This means that the economy grew drastically during the time but later burst and deflated. Social Impact Of Economic Change.
There are arguments that the Chinese economy may take the same course whereby it will burst and deflate in future going by some analysis. However, other arguments counter this notion by asserting that the case of China is different from Japan and China has learnt a lesson from Japan and hence it cannot be affected like Japan. Therefore, the purpose of this study is to show that China’s economy will follow the pattern of Japan and will burst and deflate in future. This study offers reasons as to why China is going the case of Japan. Social Impact Of Economic Change.
Based on the analysis provided in this study regarding the nature of economic growth in China, it can be clearly deduced that China is going the Japan’s way and hence its economy will burst in future. The case of China is a concern to researchers and scholars because it has attracted many investors and hence it is important for investors to understand the dynamics of the economy as well as for the China’s government to learn from the lesson of Japan and make the necessary changes to avoid the mistakes made by Japan. Sustaining economic growth is not an easy task because of the external factors. Social Impact Of Economic Change.
Boltho, A. & Weber, M. 2009. “Did China follow the East Asian development model?” The European Journal of Comparative Economics 6(2): 267-286. http://eaces.liuc.it
Caballero, R., Takeo, H. and Kashyap, A. 2008. Zombie Lending and Depressed Restructuring in Japan. American Economic Review 98(5): 1943–77. http://economics.mit.edu/files/3770
Chamon, M., Kai, L. and Eswar, P. 2011. The Puzzle of China’s Rising Household Savings Rate. VOX, 1. http://voxeu.org/article/puzzle-china-s-rising-household-saving-rate
Chew, J. 2015. China Now Has More Billionaires Than the U.S. Fortune, 1. http://fortune.com/2015/10/15/china-billionaires/
Fukumoto, T. and Muto, I. 2011. “Rebalancing China’s economic growth: Some insights from Japan’s experience.” Bank of Japan Working Paper Series No. 11-E-5, 2-23. https://www.boj.or.jp/en/research/wps_rev/wps_2011/data/wp11e05.pdf.Social Impact Of Economic Change.
Hale, T. 2015. China Bond Sales Powered by Banks. Financial Times, 1. https://www.ft.com/content/550a68b0-7977-11e5-933d-efcdc3c11c89
Hayashi, F. and Prescott, E. 2002. The 1990s in Japan: A Lost Decade. Review of Economic Dynamics 5(1): 206–35. https://doi.org/10.1006/redy.2001.0149
Jin, K. 2016. No, China is not the next Japan. World Economic Forum, 1. https://www.weforum.org/agenda/2016/10/no-china-is-not-the-next-japan/
Lewis, L., Mitchell, T. & Yang, Y. 2017. Is China’s economy turning Japanese? Financial Times. https://www.ft.com/content/a3564812-363c-11e7-99bd-13beb0903fa3. Social Impact Of Economic Change.
Ma, D. and Adams, W. 2014. In line behind a billion people. Saddle River, N.J.: FT Press
Smith, R. 2016. Is China the next Japan? The Independent Review 21(2): 275-298. http://www.independent.org/pdf/tir/tir_21_02_08_smith.pdf
Wildau, G. 2015. China’s migrant miracle grinds to a halt. Financial Times, 1. https://www.ft.com/content/211df974-ee47-11e4-98f9-00144feab7de. Social Impact Of Economic Change.