Private Investments in Human Capital Growth in Asian...

This essay will be explaining that why macroeconomics stability is one of the key success factor that contributes to the tremendous economic growth in the last forty years of development in asian countries like singapore, hong kong and south korea. The objective of a government economic policy is to achieve stability. A volatile business cycle is not ideal to the economy as the rapid growth of an economy with high demand and inflation will lead to a recession as the long term inflationary growth will not be sustainable. Macroeconomics stability ensures that the country minimizes its exposure to external shock and volatility against the global market which will in the end leading to sustainable economic growth. Some of the safety†¦show more content†¦The overall national economic output will increase when the employment rate is high. When employment rate is high, the wages of the worker increases then leads to a rise in price for consumer good which causes inflation to increases hence the employment rate has an inverse relationship to inflation. Singapore has been trying to balance between the inflation and unemployment rate because when there is a high volatile fluctuation between the employment rate and inflation, the business cycle span reduces making the economy vulnerable to recession most of the time. Low and stable inflation is a key factor in long term sustainable growth which will lead to a steady, healthy and predictable economy hence attracting foreign investors into singapore to set up business to boost the economy by allowing them to plan for long term strategy. One of the key factor to manage the inflation rate effectively is through monetary policy. Currency stability allow investors to develop long term strategy and minimize exchange rate risk. As Monetary Authority of Singapore(2014) states that adopting the management of exchange rate as it is ideal in terms of the small economy of singapore where it is easier to manage through direct intervention within the foreign market. It is seen as an effective mitigation to curb the high inflation rate for singapore economy However, having just human capital is not sufficient to sustainShow MoreRelatedWhy The East Asian Miracle Really Helped East Asia s Economical Growth1484 Words   |  6 Pageseconomic growth before, The East Asian Miracle, occurred. The East Asian miracle has really helped East Asia’s economical growth. During this semester we have come across The East Asian Miracle, and how it came about. I have read The Four Little Dragons, also the World Bank report and Balassa’s article. Each one of the readings have different and similar arguments in why The East Asian Miracle happened. While The Four Little Dragons has a bit of a different argument on how The East Asian MiracleRead MoreThe Relationship Between Public Capital and Economic Activity 1233 Words   |  5 Pagesinfrastructure as capital and labour as the other input. He established that military capital had insignificant association with productivity. Nevertheless, the ‘core’ infrastructure such as stree ts, highways, airports, mass transit, sewers, water systems, etc., had the majority explanatory power for productivity. The relationship between public capital and economic activity at the State level in the US was examined by Munnell (1990a, 1990b). In the initial analysis, public capital was found to haveRead MoreImpact Of Economic Governance On Total Investment Volatility1125 Words   |  5 PagesA sustained level of investment plays a critical role for the growth and development of an economy. However, the investment levels are subject to high degree of variability and fluctuations within and across countries. Volatility in investment triggers uncertainty and deters capital accumulation and thereby substantially reduces the growth potentials. Good governance is a critical stimulant for backward and forward linkages of sustained productive investment. In view of this, the present study analysesRead MoreRamos Administration : The Philippines Essay1550 Words   |  7 PagesAdministration, the Philippines experienced economic growth but also encountered many economic difficulties due to of the lack of foreign investors and coup attempts. In the 1992 elections, Defense Secretary Fidel Ramos, who was endorsed by Aquino, won the presidency with only 23.6 percent of the votes in a seven-way race. Even though Ramos assumed presidency, analysts still viewed the Philippines as a risky investment based off the fact that the per capita income growth in the Philippines was significantly lowerRead MoreEconomic Growth Theories and Models, A section of a Research Paper1524 Words   |  6 PagesClassical Theory of Economic Growth Harrod Domar Growth Model The Neoclassical growth Model Empirical literature 2.1 Theoretical Literature The long history of ideas on economic growth started from the classical economists like Adam Smith, Robert Malthus, Ricardo and Marx. For more than three decades the Neoclassical and the Endogenous Growth theories were arguing and forwarding economic reasons on trend of economic growth through investment as a general and private investment in particular. ThoughRead MoreThe Association of Southeast Asian Nations1836 Words   |  7 Pages1.0 INTRODUCTION Association of Southeast Asian Nations (ASEAN) is a political organization, culture and economy in Southeast Asia. ASEAN groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam. ASEAN should promote economic and political interests in the region when dealing with other areas of the world. ASEAN also promotes social and cultural development and regional stability. While ASEAN countries have different styles of government, ASEAN alsoRead MoreChina And The High Asian Economies3127 Words   |  13 Pagesquicker than any other region across the world. China and the High Performing Asian Economies (HPAE) have been the fastest growing economies ever, demonstrating phenomenal economic growth in the years between 1965 and 1990. Compared to large parts of Asia Sub-Saharan Africa and Latin America, the HPAE’s have been highly successful at achieving high growth rates. Most of this success can be attributed to the staggering growth in Jap an, the four tigers including Hong Kong, the Republic of Korea, SingaporeRead MoreSwot Analysis of Banking Industry1342 Words   |  6 Pageslending in emerging economies like India has been of recent origin. Asia Pacific’s vast population, combined with high savings rates, explosive economic growth, and underdeveloped retail banking services, provide the most significant growth opportunities for banks. Banks will have to serve the retail banking segment effectively in order to utilize the growth opportunity. Banking strategies are presently undergoing various transformations, as the overall scenario has changed over the last couple of yearsRead MoreThe rapid rise of economies in Asia over the past few decades has been phenomenal. According to1200 Words   |  5 PagesAccording to (Steven, Jeffrey and Jong-Wha, 1997), Asian countries such as Hong Kong, Singapore, Taiwan, Korea, China, Malaysia, Thailand and Indonesia grew at an average of over 5.5% per year in per capita terms between 1965 and 1990. The mentioned 08 Asian countries are also known as the eight high-performing Asian economies (HPAEs). With exception to some post-war European countries, such growth rates at this magnitude and duration are unprecedented in human history. During the mentioned timeline, 23Read MoreImpact of Globalization on Indian Economy1572 Words   |  7 Pagesthe market economy and renewed belief in the private capital and assets, a process of structural alteration encouraged by the studies and influenc es of the World Bank and other International organisations have started in many of countries. Also Globalisation has brought in new avenues to developing countries. Greater access to developed country markets and technology transfer hold out promise improved productivity and higher living standard. Countries around the world have closer over past few decades