The development of Latin America versus the Asian Tigers

The development of Latin America versus the Asian Tigers

For too long economics said the factors of production and therefore responsible for the development were: land, capital and labor, it was with what had Latin American countries so one supposes that these would be the future global economic powers, for their part, East Asia countries without these resources to the same extent but now they have the record of economic growth, high and sustained in recent decades. This was due to industrial development in eight countries: Japan, the four dragons and tigers: Hong Kong, Singapore, Taiwan and South Korea, named for its rapid economic development, and three newly industrializing countries: Malaysia, Thailand and Indonesia. Industrial development based on foreign capital investment and over-exploitation of cheap labor, abundant and poorly organized in unions.

The positive contributors to their development were its geographic location (for easy access to sea routes to export their products) and the relative closeness between them that favored capital flows. For example, Japanese manufacturers moved their factories to southern countries to benefit from lower wages.

Importantly, not only the speed of economic growth, but the improvement in human welfare due to greater equity in the distribution of profits. The per capita income growth rare was reflected in the reduction of poverty. For example, Thailand, the 1960 had 59% of its population living below the poverty line and in the decade of 1980 this ratio had fallen to 26%. Another example is Indonesia, in late 1970 had 58% of its population below the poverty line and ten years later this rate had fallen to 17%. In addition, other social indicators improved as the percentage of illiteracy.