Economies of AsiaChina, India, Japan, & North Korea

China—Overview

World’s largest exporter GDP per capita = $9,800 Primary exports: electrical and other

machinery, clothing, textiles Top export partners: Hong Kong, U.S.,

Japan Primary imports: electrical and other

machinery, oil/fuel, medical equipment, cars Top import partners: South Korea, Japan,

Taiwan, U.S.

China—How do they decide…

What to produce?

How to produce?

For Whom to

Produce?•40% based on state-run industries

•Inefficiencies (agriculture) limit China’s growth

•Food production must meet self-sufficiency level; extra is exported

•60% based on private sector (production decisions made by producers & consumers)

•Rapid economic growth• Difficult to

monitor pollution and consumer safety

•Large amounts of manufactured goods exported

India—Overview

Diverse economy English-speaking population major exporter in

various technology-based fields GDP per capita = $4,000 (rising gradually) GDP breakdown—services (66%), industry

(17%), agriculture (~17%) Primary exports: petroleum products, precious

stones, machinery, iron & steel Top export partners: UAE, US, China

Primary imports: oil, precious stones, machinery Top import partners: China, UAE, Saudi Arabia

India—How do they decide…

What to Produce?

How to Produce?

For Whom to Produce?

•Moving toward market economy since 1991 (private sector and foreign businesses)

•Legal challenges and heavy tax system make operating a business difficult. Working to improve this.

•Food production—mostly domestic; citizens produce for family consumption

•Lots of corruption in business world

•Increasingly educated workforce (engineering and computer science)

•Export markets rapidly expanding for private Indian companies

Japan—Overview

Economy top priority of Shinzo Abe & the Diet after several economic recessions

GDP per capita: $37,100 Primary exports: vehicles (& parts), plastic

materials, power generating/conducting materials Top export partners: China, U.S., South Korea

Primary imports: petroleum, natural gas, clothing, semiconductors, coal, audio/visual equip. Top import partners: China (21.3%), U.S. (8.8 %),

Australia

Japan—How do they decide…

What to Produce?

How to Produce?

For Whom to Produce?

•Primarily market-driven• Supply and

demand determine production

•Private businesses determine production processes

•High standard of living = strong domestic market for goods and services

•Government-controlled = lower productivity rates• Agriculture

•Major exporter because of efficiency and reputation for quality goods/services

North Korea—Overview

Military spending reduces availability of resources for civilians

GDP per capita: $1,800 Primary exports: minerals, metal

products, manufactured goods (weapons), textiles, agriculture & fish products Top export partners: China & South Korea

Primary imports: petroleum, coal, machinery & equipment, textiles, grain Top import partners: China & South Korea

North Korea—How do they decide…

What to Produce?

How to Produce?

For Whom to

Produce?•Some small market reforms, but majority of economy controlled by gov’t.

•Production decisions and methods determined by government

•¼ of output devoted to military—limits goods/services for rest of population

•Large recipient of food and aid from foreign nations

•Natural resources and manufactured goods exported

•Large underground economy (market-based)

Where are they on the continuum?

CommandEconomy

MarketEconomy

52.5—

China

55.75—

India

72.4—

Japan

1—North Korea

Asian Economies—Quick Quiz

1. Market2. Command3. China4. Japan5. India6. North Korea

A. Economic system w/ almost full government control

B. Economic system driven by supply and demand

C. Country that is closest to full market

D. Country with the most government control

E. Country that is considered the world’s leading exporter

F. Country with a diverse economy, becoming more market-based