Explain to me each of the ff in simple words and easy to understand. I don't need long explanation tutor its okay if the explanation is concise but the thought must be on it. I know this is long but i hope someone could help me. We have recitation and reporting tomorrow.

Aspects of Industrial Development

*CHOICE OF TECHNOLOGY - In the early stages of industrialization, countries have limited capital and plentiful labor.

-Labor intensive technologies may be appropriate in a poor country with plenty of low skilled and cheap labor but because of factor market distortions (such as those created by tax breaks for capital equipment), the choice of technology may be more capital intensive.

*ECONOMIES OF SCALE - It come into play when a country is exporting or when production is taking place on a large scale for the domestic market.

-A proportionate saving in cost gained by an increased level of production.

- It come into play when a country is exporting or when production is taking place on a large scale for the domestic market.

-The standard for measuring the efficiency of an industry is to use the price of imports.

EFFICIENCY ISSUES

*Economic Efficiency and Scale of Production - Efficiency depends upon a number of special factors .

-It may be that all firms can be efficient if they have reached a viable size of production that takes full advantage of economies of scale.

-Better transport and communication also make it possible to have a nationwide production, marketing and distribution strategy.

Do Protected Industries Become Efficient Over time?

*Evidence suggests that there are numerous pitfalls to a strategy of protecting infant industries.

*These industries and firms will eventually be forced to compete in external markets.

*In order to become competitive, they should be in an industry where the country has a comparative advantage or else they will be inefficient.

Are There Advantages to Small Scale Industrial Development?

*Scale-scale enterprise (or small and medium enterprises-SMEs) are generally more labor intensive.

*Small scale firms can be very successful when they concentrate in particular locations where they can shared a skilled labor force base and where they can produce differentiated products of high quality.

FOREIGN TRADE

*Export are critical in explaining productivity gains in the Asian economies. Internal competition does not seem to be sufficient to bring about high rates of productivity increase.

*Example, large country with low industrial concentration ratios, efficiency rates are still low.

OTHER TRANSITION ISSUES

*From the mid-1960s to the late 1990s, the growth rate of the East Asian economies of Hong Kong, Korea, and Taiwan together with Singapore in

Southeast Asia - sometimes called the Asian Tigers, or the newly industrialized economies (NIEs) - grew at a faster rate than any other economy or group of economies had in history (World Bank, 1993; and Quibria, 2002).

1.A FURTHER LOOK AT TOTAL FACTOR PRODUCTIVITY (TFP) - The reason for the rapid growth was brute force application of a simple Harrod -

Domar growth model augmented by the growth of the population.

-In order to sustain a rapidly growing industrial sector in a quickly evolving global environment, much more is required than just a high rate of

investment and appropriate pricing of inputs and incentive for export.

2.HISTORICAL TRANSFORMATION OF THE INDUSTRIAL SECTOR - To give you an idea of how the structure of industries within these economies has changed over time consider a snapshot of their industrial sector in the early 1960s, 1975 and 1990.

Five Components:

1.Resource -based industries that include aluminum, food and oil refining as examples.

2.Labor - intensive industries, including garments, footwear and toys.

3.Scale -intensive industries, including steel, automobiles, paper, and chemicals.

4.Differential industrial products, including TVs, power equipment, and advanced machinery.

5.Science -based industries, including electronics, pharmaceuticals and biotechnology.

3. THE ELECTRONIC SECTOR - In order to examine the structure transformation in the industrial sectors of the NIEs and to look more closely at

the role of technology, it is useful to focus on the electronics industry.

4.DIFFERENT PATTERNS OF TECHNOLOGICAL TRANSFER - The methods varied from economy to economy.

There were four basic factors underpinning their success:

1.Firms benefited from low rates of interest, low inflation, and high rates of saving within the economies.

2.They all respond to the open and outward-looking export-led strategies that were generally followed.

3.All the NIEs developed an appropriate human resource development strategy that complemented and provided trained workers for the growing industrial sector.

4.Government intervention was undertaken whenever it was needed.

5. Country Experiences - Hence over the years, the Asian countries have actively developed their electronic sector although there are differences in their field of specialization owing to differences in the labor force and technological advances.

COMPARATIVE ADVANTAGE AND ASIAN INDUSTRIALIZATION

*Balassa (1965) - According to this line of reasoning, products that are being exported more intensively are those that a country has comparative advantage in producing and exporting.

*Amsden (2001) - He recommended that the mix of industries in Japan and the United States be taken as a benchmark for comparative advantage.

*NIEs have a dynamic comparative advantage in electrical and non-electrical equipment as well as transport equipment

*Dowling and Ray (2000) - Have constructed an index of export growth for the Asian economies that is, by design, heavily influenced by the changing structure of exports.

Electronics, Computers, Pharmaceuticals - These three industries rank as the top-three when the average annual growth of world exports is calculated for the 1980-1995 period.

THE ROLE OF INNOVATION

*INNOVATION - requires a creative process by abandoning old ways of doing things and the adoption of new methods and processes.

-requires the ability of the economic system to facilitate the exit of inefficient companies and the entry of new and more productive ones.

-Innovation in Southeast Asia has primarily been the result of spending by MNCs. In East Asia, innovation has been developed through licensing agreements rather than MNC participation.

-Innovation has also taken place in marketing and distribution as ICT and transportation efficiencies have cut costs.

THE ROLE OF THE GOVERNMENT

*Generally speaking, government policy in the industrial sector has adopted a hands-off attitude in terms of providing direct incentives for individual industries. This is particularly true in the case of Taiwan, where there are no specific industries supported by the government. In the case of Korea, strong industrial policies were advocated and the emphasis has shifted over time. Nevertheless, a bias toward particular large industries has been maintained.

*In Southeast Asia, a more balanced attitude has prevailed with few subsidies or promotional advantages offered. Nevertheless, the industry has

been nurtured in a number of ways.