The Dynamic Newly Industrializing Countries
Wells, Nicola F.
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Twenty years ago the nations of Brazil, Hong Kong, Malaysia, Mexico, Singapore, South Korea and Yaiwan performed only a minor role on the international economic scene. Today, though, after a decade or so of amazing growth, these seven;countries form a unique economic group, referred to as the newly industrializing countries (the NIC's), which is challenging the control of the more developed countries over the world market. The rapid growth of these nations has brought forth many questions on how they have succeeded and in what commodities are they specializing. Moreover, this rapid growth causes rising concern in the MDC's as to whether this group is, in fact, taking over the world market, thereby jeopardizing some of their major businesses. These questions were also asked by the U.S. Department of Labor, which contracted Data Resources, Inc. to find the effect of the NIC's on the U.S. market. I had the opportunity of working at DRI to help set up and analyze the data in an effort to find some answers to these questions. Each of these countries changed from a typical colonial type economy, exporting only a few different types of standard primary products, to an industrialized nation whose economy is based on export production of more sophisticated commodities. Within this paper, the structural changes of and the growth patterns of the NIC's exports are analyzed using various econometric techniques. The data are all in matrix or array form that provides a perfect setting for statistical testings, especially pooled regressions, which enable one to test the homogeneity of the NIC's as a group. This, coupled with the growth rates of the exports with respect to constant dollars and market shares, gives a precise picture of the dynamic growth of these nations. The growth is basically due to consistently outward looking economic policies, with the major emphasis on expanding exports. The NIC's all share the same type of background and goal -- modernization -- which symbolizes industrialization, a broadening of their economy and a higher standard of living. With these similarities in mind, it is interesting to examine the differences in the growth paths of the NIC's as well as the differences in the importing countries.Missing pages 47 and 75.