Economic Growth in Asia: Determinants and Prospects

38 Pages Posted: 22 Oct 2010

See all articles by Jong-Wha Lee

Jong-Wha Lee

Korea University

Kiseok Hong

Ewha Womans University - Department of Economics

Date Written: September 1, 2010

Abstract

Using a growth accounting framework, we find that developing Asia grew rapidly over the past 3 decades mainly due to robust growth in capital accumulation. The contributions of education and total factor productivity in the region’s past economic growth remain relatively limited. Our baseline projections based on the model of conditional convergence show that the gross domestic product (GDP) growth rates of the 12 developing Asian economies covered by this paper will be consistently lower for the next 2 decades than their historical performance. However, policy reforms in education, property rights, and research and development can substantially raise GDP growth in the region and partly offset the slowdown in growth caused by the convergence phenomenon. By expanding at robust rates, developing Asia will account for close to two thirds of the world economy in 2030, almost doubling the current 34% share of the region in 2009.

Keywords: economic growth, growth accounting, capital accumulation, human capital, total factor productivity

JEL Classification: O11, O15, O32, O47, O53

Suggested Citation

Lee, Jong-Wha and Hong, Kiseok, Economic Growth in Asia: Determinants and Prospects (September 1, 2010). Asian Development Bank Economics Working Paper Series No. 220. Available at SSRN: https://ssrn.com/abstract=1688733 or http://dx.doi.org/10.2139/ssrn.1688733

Jong-Wha Lee (Contact Author)

Korea University ( email )

Anam-dong, Sungbuk-Ku
Dept. of Economics
Seoul, 136-701
82-2-3290-2216 (Phone)
82-2-928-4948 (Fax)

Kiseok Hong

Ewha Womans University - Department of Economics

11-1 Daehyun-dong
Seodaemun-gu
Seoul 120-750
Korea, Republic of (South Korea)

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