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Typo posted:Therefore China had the option of rapidly importing technology, investments and expertise far in advance of its own (either from the Soviets or the west) to fuel growth. asdf32 posted:So for example while textile productivity growth rates may be low and stagnated internationally they still might be far higher than your country's current productivity average. So installing boring t-shirt machines can be a boon. The point is I agree that productivity and productivity growth rates are critical, but so long as productivity is growing it doesn't matter whether it's coming from a cutting edge industry or not. This narrative isn't what happens in real life, and I'm shocked that people still think this way despite the opposite being heavily documented in mainstream media. There's tons of liberal tearjerkers about sweatshops and cheap labor in Asia and Africa, and you don't hear about developing countries adopting the latest fully automated assembly systems. There's a reason for that - developing countries are competing on the cost of labor and if you have high productivity systems, the cost of labor goes down and so does that advantage. Without a strong state to say 'adopt this less profitable but technologically advanced venture,' there is no incentive for firms in a developing country to adopt the latest productive technologies if it's more profitable to stick with labor-intensive ones. That's why very basic poo poo is still made by humans in poor countries when they can be made by robots, and it's hampering the growth of productivity. On topic anecdote: I'm from Wenzhou, and yup it's the richest city you've never heard of. I currently live in the US but when I went back a few years ago (after the shadow banking crisis hit) I hung out with a financial advisor family friend and he was peddling the same old poo poo. Everyone knows about the crisis, it's like a mini-GFC in the city, but things seemed to have been all right. Maybe I didn't talk to the right people or the government bailed everyone out, but everything seemed normal in the aftermath. That's either good, or my worst fear which is that the crisis happened but no lessons were learned. Edit: anecdote is just anecdote, I'm no expert on shadow banking or what's going on in China. I just hang out with friends and family. flatbus fucked around with this message at 03:58 on Mar 21, 2014 |
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Mar 21, 2014 03:54
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asdf32 posted:If a country has an abundance of workers doing low productivity tasks then it's likely to be more profitable to distribute cheap capital widely than expensive capital to just a few of them (and given a certain dollar amount, that's the choice). Profit here isn't capitalist profit, but general surplus (and remember, subsidies are money taken from somewhere). This goes directly against the claim that countries can benefit from the path (or technology) taken by previously industrializing countries. China has a very strong state so I'm not counting it here (and this is going to veer off topic so I'll watch myself), but if you're saying that it's obvious that a developing country can't make use of the latest productive tech and should climb up the productivity chain all by its own, how in the world is convergence ever going to happen unless the developed countries stop innovating?
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Mar 21, 2014 05:40
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