China's rapid growth

Question 1

8 factors causing rapid growth

Answer 1

Convergence theory
Free rider effect
Technocratic authoritarian government 
Neighbouring models
Export focused manufacture
1979 "Socialism with Chinese characteristics"
Low interference
Equity

Question 2

Convergence

Answer 2

Due to diminishing returns there is more incentive for investors to contribute capital to underdeveloped economies due to greater profit margin (Dangote Cement in Nigeria makes 62% margins on sales)

Question 3

Free rider effect

Answer 3

China benefited from modern technologies during development and didn’t have to encourage people to replace infrastructure norms ( Phone ownership grew 0.2-1bn 2000-2010)

Question 4

Technocratic authoritarian government

Answer 4

Central planning and disregard for SR QOL ensure resources aren’t diverted from capital to consumer goods which assists LR growth, made intervention easy, remove red tape

Question 5

Neighbouring models

Answer 5

Follow the example of 4 Asian tigers

Question 6

Export focused manufacture

Answer 6

Plays to the comparative advantage of China as MEDC’s can’t compete with labour factors

Question 7

Low interference

Answer 7

Allowed free market ‘creative destruction’ to remove inefficient industries

Question 8

Equity

Answer 8

History of low inequality communism means less distortion of incentives, poverty traps and better integration of typically discriminated within labour force resulting in larger more skilled labour pool