learning from the japanese economic miracle: what factors lead to economic growth?

Learning From the Japanese Economic Miracle: What Factors

Lead to Economic Growth?

Japan After World War II

• Most of Japan’s major cities were severely damaged.

• About 3 million Japanese died.

• Many industrial factories were severely damaged or destroyed.

Japan’s Miracle Economic

• Post WWII, Japan soon became an economic power.

• No nation, up until the time, had seen their income and production rise faster than Japan between 1950-1975.

• Why? • What leads to

Economic Growth?

Note the Economic Growth in Japan from 1950 – 1975.

Japan

United States

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Factors that Lead to Economic Growth and increased productivity

1. Investment in capital goods, research and technology.

2. Investment in human capital: education and skills.

3. Saving and investment4. Public policy: free trade and competition

INVESTMENT IN CAPITAL GOODS: RESEARCH AND TECHNOLOGY

TECHNOLOGICAL PROGRESS

Shinkansen: High Speed Rail Line: 186 mph

Investment in Human Capital: Education

The Japanese are among the world’s best educated population.

Public Policy: Promoting competition, property rights, and free trade.

Toyota Honda

Japan Today

BIBLIOGRAPHY

Murphey, Rhoads. East Asia: A New History (4th Edition). New York: Longman, 2006.

Mankiw, Greg. Principles of Economics. (4th Edition) USA: Thompson South-Western, 2007.