Why do economies develop differently? Economics, politics, and culture can all play a role. For this assessment, you’ll create a presentation to compare the development of 2 different countries or economies since 1992.
Step 1: Select 2 Economies
Review the pairs of economies listed below. Except for NAFTA/EU, each pair has 1 highly successful country and 1 less successful country.
NAFTA vs. European Union (the world’s two largest economic entities)
China vs. India (the world’s two most populous countries)
South Korea vs. North Korea (two polar economic opposites, one people)
Venezuela vs. Saudi Arabia (the world’s two largest sources of oil reserves)
Nigeria vs. Democratic Republic of the Congo (functioning government and civil order vs. struggling government and violent clashes among factions; note: the Republic of the Congo is not the same country as the Democratic Republic of the Congo)
Research the economies of your chosen pair.
Compare similarities and differences between the economies.
Step 2: Create a Presentation
Create a 12- to 16-slide presentation about the two economies. Explain how their economic, political, and cultural development since 1992 has influenced their economic growth and trade competitiveness.
Include tables and graphs in your presentation. Use these visual elements to support your analysis of the following economic statistics/indicators for your 2 chosen economies. Show data from 2009 through the most recent year available (the trough of the last economic cycle). Whenever possible, plot the metric for both economies on the same chart.
GDP per capita growth over time
Inflation rate over time
Unemployment rate over time
Exports as a percentage of GDP over time
National government debt as a percentage of GDP
Evaluate the reasons why the economic growth of the 2 economies/countries differed. Discuss how international trade influenced the strength of each economy. Discuss the role of value chains and value-added production.
Analyze how the failure to use value-added trade measures distorts trade statistics.
Examine at least 2 industries that have given each economy a comparative advantage in world trade.
Full Answer Section
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- Exports as a percentage of GDP
- National government debt
- Trade competitiveness
- Role of value chains and value-added production
- Impact of economic, political, and cultural factors
Slide 3: Economic Overview: China
- Key Economic Reforms: Market-oriented reforms initiated in late 1970s, including:
- Decentralization: Shifting economic decision-making from the central government to local authorities.
- Privatization: Gradual privatization of state-owned enterprises.
- Open-door policy: Encouraging foreign investment and trade liberalization.
- Political System: Authoritarian one-party rule, providing stability and facilitating rapid economic reforms.
- Cultural Factors: Strong emphasis on education, hard work, and collective responsibility.
Slide 4: Economic Overview: India
- Key Economic Reforms: Liberalization policies initiated in 1991, including:
- Deregulation: Reducing government intervention in the economy.
- Privatization: Opening up sectors to private investment.
- Trade liberalization: Reducing trade barriers.
- Political System: Democratic system with multiple political parties, leading to policy debates and potential for slower decision-making.
- Cultural Factors: Diverse population with varying cultural and linguistic backgrounds, potentially leading to regional disparities and challenges in policy implementation.
Slide 5: GDP per Capita Growth (1992-Present)
- Chart: Line graph comparing GDP per capita growth rates of China and India from 1992 to the most recent available year.
- Analysis:
- China consistently experienced higher GDP per capita growth rates compared to India.
- Analyze potential reasons for this difference, such as:
- Faster pace of economic reforms in China.
- More centralized decision-making in China.
- Greater emphasis on export-oriented manufacturing in China.
Slide 6: Inflation Rates (1992-Present)
- Chart: Line graph comparing inflation rates of China and India from 1992 to the most recent available year.
- Analysis:
- Analyze trends in inflation rates for both countries.
- Discuss potential factors influencing inflation, such as monetary policy, global commodity prices, and domestic demand.
- Compare the effectiveness of inflation control measures in both countries.
Slide 7: Unemployment Rates (1992-Present)
- Chart: Line graph comparing unemployment rates of China and India from 1992 to the most recent available year.
- Analysis:
- Analyze trends in unemployment rates for both countries.
- Discuss potential factors influencing unemployment, such as economic growth, labor market regulations, and structural changes in the economy.
- Consider the impact of informal employment on unemployment statistics.
Slide 8: Exports as a Percentage of GDP (1992-Present)
- Chart: Line graph comparing exports as a percentage of GDP for China and India from 1992 to the most recent available year.
- Analysis:
- Analyze the role of exports in driving economic growth in both countries.
- Discuss the impact of globalization and trade liberalization on export growth.
- Identify key export sectors for each country.
Slide 9: National Government Debt as a Percentage of GDP
- Chart: Line graph comparing national government debt as a percentage of GDP for China and India from 1992 to the most recent available year.
- Analysis:
- Analyze trends in government debt levels for both countries.
- Discuss the implications of high levels of government debt for economic growth and stability.
- Compare the fiscal policies and debt management strategies of both countries.
Slide 10: Trade Competitiveness
- Discussion: Analyze the factors contributing to the trade competitiveness of each country.
- Cost competitiveness: Labor costs, energy costs, and access to raw materials.
- Innovation and technology: Development of new technologies, research and development, and intellectual property protection.
- Infrastructure: Quality of transportation, communication, and energy infrastructure.
- Human capital: Education and skills of the workforce.
- Government policies: Trade policies, investment incentives, and regulatory environment.
Slide 11: Value Chains and Value-Added Production
- Explanation:
- Define value chains and explain their importance in global trade.
- Discuss the concept of value-added production and its significance for economic development.
- Analysis:
- Analyze the role of value chains in the economic development of China and India.
- Discuss how each country participates in global value chains (e.g., as a manufacturer, assembler, or supplier of raw materials).
- Examine the extent to which each country has moved up the value chain and increased its share of value-added production.
Slide 12: Limitations of Traditional Trade Statistics
- Discussion:
- Explain how traditional trade statistics (based on export and import values) can distort the true picture of a country's trade performance.
- Discuss the limitations of using traditional trade statistics to measure economic competitiveness and development.
- Emphasize the importance of using value-added trade measures to obtain a more accurate understanding of a country's contribution to global value chains.
Slide 13: Comparative Advantage: China
- Industry 1: Manufacturing (e.g., electronics, textiles, automobiles)
- Factors: Low labor costs, large and skilled workforce, strong manufacturing infrastructure, government support for export-oriented industries.
- Industry 2: Renewable energy (e.g., solar panels, wind turbines)
- Factors: Government investment in renewable energy technologies, strong research and development capabilities in certain areas, cost competitiveness in manufacturing components.
Slide 14: Comparative Advantage: India
- Industry 1: Information Technology (IT) and Business Process Outsourcing (BPO)
- Factors: Large pool of skilled English-speaking professionals, competitive labor costs, strong focus on education in science and technology.
- Industry 2: Pharmaceuticals
- Factors: Large generic drug manufacturing industry, low-cost production, strong research and development capabilities in certain areas.
Slide 15: Conclusion
- Key Findings: Summarize the main findings of the analysis, highlighting the key differences in the economic development trajectories of China and India.
- Policy Implications: Discuss potential policy recommendations for each country to further enhance their economic growth and competitiveness.
Slide 16: Q&A
- Open the floor for questions and discussion.
Note: This is a basic framework. You will need to:
- Gather data: Collect data on the economic indicators mentioned for China and India from reliable sources (e.g., World Bank, International Monetary Fund, national statistical agencies).
- Create charts and graphs: Use appropriate software (e.g., Excel, Google Sheets) to create the visualizations.
- Conduct in-depth research: Explore the specific economic, political, and cultural factors that have influenced the development of each country.
- Refine the analysis: Tailor the analysis and presentation to your specific interests and the depth of your research.
This framework should provide a solid foundation for your presentation on the economic development of China and India. Remember to cite all your sources properly.