Globalisation, Technology, And Asian Economic Growth (Global Independence) (Report‪)‬

The recent economic turmoil in East Asian economies has raised questions regarding the robustness and replicability of their experience. The paper discusses the impact of globalisation on technological change--the main factor contributing to rapid economic growth and the current crisis in the East Asian economies. Technological development contributed to rapid economic growth, and incommensurate technological development triggered the present crisis. Thus, continuous technological upgrading along with wider restructuring of the economy are the major prerequisites for the growth process to continue. Based on the analysis of the growth experience of East Asian economies, the following lessons are drawn: (1) technological development is the key to export expansion; (2) active state and set of institutions, incentives, and policies are needed to mobilise resources to catching up; (3) accumulation of physical and knowledge capital is important for efficient and effective utilisation of technology; (4) financial and technological capabilities of the SMEs should be strengthened; and (5) there is a need to redefine the link between local capability formation and international linkages. I. INTRODUCTION