LDCS VS DCs Flashcards
LDCS posed a threat
Process of convergence
Diffusion of technology
DCs losing larger markets
Asian countries developing faster in terms of R&D
Introduction
Globalization has impacted the economic growth of various developing countries in the recent years when industries moved to the LDCS
As a result many economists opined that the rise if china and India as emerging economies posed a threat to DCs while others said that DCs have more to gain from this global change
Process of convergence in new global economy saw a transfer of technology and investments to LDCS especially in low tech manufacturing
This convergence led to a loss of jobs in DCs when factories of low tech closed down.
The high cost of labour Is one factor that led to this change other thane DCS restricting their economies to tertiary aka deindustrialisation
Fear of many job losses will take place in the future, more factories moved to developed countries .
Apparent fear that technology diffusion to developing countries will increase production and competitiveness of low waging developing economies
This impels that products from DCs will face competition from the developing countries as the latter will improve quality of products and hence will flood western markets
To prove a case in mind would be Korean car manufacturers were able to increase car performance thru use of western technology (turbo engine), hence showing that European car manufactures faced great challenged with Asian car producers and car prices would fall
DCs are losing are losing a large market in the Asian pacific and even European region when large Asian corporations produce goods that were once the monopoly of advancements
Due to comparative advantages the emerging economies of China and India and market them successfully in the global economies
For instance Chinese and Indian manufactures cheap labour as well as producing cheap and yet good quality products in textiles that cause European manufactures to face fierce competition
The Asian counties are fast developing their R&D
Innovations and creative ideas in machine technology and interactive tech gained much recog from the west. India for instance has developed IT sector in Bangladesh
Subsequently most of the world’s IT companies are moving to India to participate in joint venture in IT services with local companies
Furthermore a recent report discussed that Chinese scientists are able to desgn trains much more faster and efficient than those In the states
