Online Courses

Asia and the World in the Asian Century

A progressive renaissance began in Asia, with the recovery of Japan after World War 2, following by the rise of the Newly Industrialized Economies of Hong Kong, Korea, Singapore and Taiwan. A “flying geese” pattern of development has continued with the success of some other ASEAN economies, and China and India. However, Asia’s share of the global economy remains still around 30%, despite the region being home to 60% of the world’s population. Asia has the potential of continuing its convergence towards the levels of development of the advanced OECD economies, and perhaps during the 21st century regaining a share of the world economy equal to that of its share of the world population. This has led many observers to argue that this century will be the "Asian Century", following on from the preceding American and British Centuries. This course will explore issues related to the promise of an Asian Century, challenges for realising an Asian Century and how Asia's renaissance is changing relationships between Asian countries, as well as the region's relationship with the rest of the world.

1. Introduction to course


Overview of course.

Course Format:

This course is structured around a blend of lectures, Youtube videos, student presentations, and class discussions.

Grading:

Two four-page (1500 words) papers -- 33% each.

-- First paper -- how much progress has Asia made in its “development”? Due Monday 1 August.

-- Second paper -- choose one Asian country and discuss the main challenges it faces to realize the benefits of an Asian Century? Due Friday 12 August.

Class presentation (6 minutes), and participation in class discussions especially final class seminar -- 34% of grade.

Some presentations will be take place in the student seminar on Friday 29 July on "role of social media and/or the sharing economy in Asia's development".

There will be no final exam.

Topics covered will include:

1. Overview of Asian Century hypothesis.

2. What is development? Assessing Asia's development.

3. Economic catch-up or convergence.

4. Role of government.

5. Global value chains.

6. Urbanization.

7. Socially inclusive development.

8. Demography and migration.

9. Democracy.

10. Asian Community?

11. Asianization of the West.

12. Western responses to Asia's renaissance.


What do we mean by the "Asian Century hypothesis"?

Asia's GDP per capita is still very much lower than world leaders like the US and Germany, despite rapid growth these past decades. And its share of global GDP less than 40%, despite Asia having 60% of the world's population.

But the 21st century could arguably become an Asian Century if Asia continues being the fast growing region in the world economy. The region has enormous catchup potential.

The 21st century could also belong to Asia if, in some decades time, Asia manages to have the world's biggest economy. This is very possible, if Asia continues its rapid catchup economic growth.

However, there are many challenges that Asia faces in realizing an Asian Century:

-- can the region maintain its rapid economic catch-up?

-- can Asia translate economic weight into political power?

-- can Asians cooperate together as a team? Or will they remain divided, and continue to look to the US and other Western countries for global leadership?

REFERENCES:
- Asian Development Bank, “Asia 2050”, Executive Summary
- ACI, Asian Century on Film
- Hans Rosling: Asia's rise -- how and when? TED Talks.
- ACI, How likely is an Asian Century
- ACI, Fast facts on Asia's people and economy
- The Asian Century, Episode 5: Tokyo (Hosted by Brendon Fernandez)
- Asia rising -- Part 1, Youtube
- Asia rising -- Part 3, Youtube
- Kishore Mahbubani on The Asian Century: Changing Asia
- Hugh White on Asian Century

2. Assessing Asia's developmental progress


Asia is in the midst of a complex process of economic, social, political and human development.

Economic development involves catchup to world leaders in terms of GDP per capita, transformation from agricultural-based economies to industrial- and service-oriented economies, and progress from low-tech to high-tech economies. Singapore and Hong Kong have made the most progress, and now have GDP per capita higher than world leaders like the US and Germany. While Japan and Korea have also made much progress, it seems unlikely they will achieve full catchup to world leaders. Most other Asian countries are still progressing more slowly in the economic development stakes.

There are many aspects of social development. East Asia is leading the world in education, according to OECD indicators, while Southeast and South Asia are performing much less well. When it comes to life expectancy, all Asian countries are doing pretty well. The gaps between advanced and poorer countries for life expectancy are much less than for GDP per capita. Asia still has enormous gender gaps, especially for Japan and Korea. The Philippines is the only Asian country to be highly ranked on this score.

According to some estimates, Japan and Korea are the only Asian countries to be "full democracies". Asia has many fragile democracies, and hybrid and authoritarian regimes. Along with these full democracies, pro-business Singapore and Hong Kong rank very well for the rule of law and low corruption.

Asia's "human development" has been exceptional, with dramatic reductions in poverty, especially in China.

Nobel-prize winning economist Amartya Sen provides another take on the development challenge, with his view that development boils down to the expansion of human freedoms. His insights can help governments and aid donors design pro-development policies. Such policies should seek to tackle the "deprivations" from which many poor people suffer, and improve their "capabilities" so that they can take control of their own lives.

Ultimately, good and strong leadership, like that of Singapore's Lee Kuan Yew, is necessary to pursue an effective pro-development agenda. But not all countries have such leadership. The leadership of North Korea, for example, is more concerned with maintaining its grip on power, and controlling dissenting voices by repressing its citizens.

REFERENCES:
- Asia's development renaissance. ACI
- ACI. Amartya Sen on development on Youtube
- Leaning house of Jakarta
- Hans Rosling: Asia's rise -- how and when? TED Talks.
- Why male Japanese wage-earners have only 'pocket money'. BBC. Youtube.
- Mrs Watanabe -- An Unlikely Combo: Japanese Housewife and Superstar Forex Trader
- Japan seeks alternatives to its pay system. BBC, 22 March 2016.
- Cultural Patterns of East Asia -- respect older people -- until 1.20.
- Aviation Experts Question Whether Culture Had Role in Asiana Crash
- Majority of Korean companies still use seniority wage system

3. Human well-being and human security in Asia


Developing countries in Asia have achieved remarkable reductions in poverty these past few decades. Poverty reduction has been most notable for China, with Southeast and South Asia managing somewhat lower poverty reductions.

Despite the progress made, large shares of Developing Asia's population still live in near poverty, with incomes in the $2-5 a day range. These people face many challenges:

-- daily income can be irregular, since large shares of the population work in the informal sector. This means that financial management is a challenge, as people must provide food for their family on a daily basis, cope with emergencies, and save up for major expenditures like houses or marriages.

-- people living just above the poverty line are also highly vulnerable to various shocks such as economic downturns, food price hikes, war/conflict and natural disasters. Asia is in fact the continent the most afflicted by natural disasters, which are likely to increase in frequency, as the effects of global warming take the toll.

While Asia's developing countries are enjoying substantial reductions in poverty, the region's advanced countries like Japan and Korea are being afflicted by rising inequality and relative poverty, as is the case in the US and most other advanced countries.

REFERENCES:
- Fareed Zakaria GPS - What in the World? Global poverty paradox
- Living on $2 a day
- Asia's low quality jobs
- China and India lead Asia's middle class growth. BBC, 17 October 2012.
- Asia's middle class
- Sanitation crisis looms over India - stark reality
- Natural disasters in Asia
- World Bank poverty data
- By the Numbers: Natural Disasters In Asia
- Inside Story - Asia and the economics of natural disasters

4. Student seminar on social media and Asia's development


Students made presentations on China's "WeChat", Hong Kong's "umbrella movement", political activism, ecommerce in Thailand, LinkedIn in China, the risk of false information, Japan's social media scene, the challenges of using kanji online, and the role of the media in shaping modern role models (like Japan's grass-eaters").

These presentations highlighted the important role that social media is playing in Asia's economic, social, political and human development.

REFERENCES:
- Asia's social media landscape -- Youtube video
- Leveraging on the social and mobile nature of Asian consumers to reach your audience -- Youtube video.
- eMarketer. Social networking reaches nearly one in four around the world.
- The State of Social in Asia (March 2013)
- Asia Foundation. Global trends in social media: an interview with blogger Beth Kanter.
- 5 social media trends that are changing Asia
- New App Promises to Tell Indian Farmers When to Sow Crops
- Hong Kong protest: Tensions on the front line - BBC News
- How Social Media Is Changing Disaster Response
- Gram Vaani: Social Networks for the Global Poor

5. Asia’s economic catchup


Asia's economic development is driven by a process of economic convergence or catchup to world leaders.

In the early stages of development, economies can make great progress by absorbing knowledge and technology from the rest of the world ("copycat development"), although India has shown the value of "frugal innovation".

As economies converge toward world leaders, it is necessary to become an "innovation nation". In general, Asian economies have proved more adept at "incremental innovation", rather than "disruptive Innovation". For example, while Asian companies now make smart phones and iPads, these were invented America's Apple.

Despite being the first Asian economy to catchup towards world leaders, Japan never actually made it. Its GDP per capita and productivity are still 30% below world leaders.

Following three decades of rapid economic growth, China's GDP per capita is about one-quarter of world leaders. China faces an enormous challenge in continuing to climb the development ladder.

There is a risk that it could fall into a "middle income trap", and not break through into high income status. One factor hindering China's progress might be the Communist Party's repression of highly creative people like Ai Weiwei who challenge aspects of the Party's rule.

REFERENCES:
- Asia's economy -- no miracle
- Economic growth prospects in Asia
- India : Universe of frugal innovation - #DownToEarth Youtube.
- Will China overtake the US?
- Innovation Asia
- Middle income trap -- Youtube
- Avoiding the middle-income trap -- Youtube
- Alibaba Counters the Myth that China Can’t Innovate
- China can innovate not just copy
- Ai Weiwei: Never Sorry OFFICIAL TRAILER

6. Asia's global value chains -- Part 1


Asia's global value chains offer new opportunities for fast track development. These value chains were born in the 1980s when Japan began offshoring large parts of its manufacturing sector to other Asian countries. Other countries followed suit and today value chains criss-cross the whole region.

While many countries like China and Bangladesh have benefited greatly from value chains, there have also been many instances of human and labor rights abuses.

REFERENCES:
- Asia's global value chains -- Part 1
- Rana Plaza Collapse Documentary: The Deadly Cost of Fashion | Op-Docs | The New York Times -- Youtube
- Philip Jennings. Rana Plaza -- 12 months on. Youtube.
- Dark Secrets: "Poorly Made In China"
- Foxconn: An Exclusive Inside Look. Youtube.
- Watchdog Alleges Child Labor at Samsung Plant. Youtube.
- Deng Xiaoping在日本新幹線Japanese Shinkansen
- US Experts See Growing Desire to Curb Outsourcing to China
- Re-Shoring and Revitalizing American Jobs

7. Asia's global value chains -- Part 2


While global value chains (GVCs) offer new opportunities for development, they also involve many challenges and risks.

Countries undertaking low value added activities in GVCs must endeavor to move up the GVC by doing higher value added activities, otherwise they risk getting caught in a middle income trap. Trade and investment liberalization such as through the Trans Pacific Partnership can facilitate the development of GVCs.

The 2008 Lehman shock and the euro crisis, which adversely affected the demand for Asia's GVC production, highlighted the risk of over-reliance on GVC-based development. Asia must now "rebalance" its development strategy, by strengthening its domestic economy.

Rising wages in China and elsewhere, along with technological change, has eroded the low cost advantage of many Asian countries in GVCs. This has led to a new trend of "reshoring" manufacturing back to the US.

GVCs have also developed for business services, with India and the Philippines becoming destinations for business process outsourcing like call centers, and accounting, legal, software and other business services.

REFERENCES:
- Asia's global value chains -- Part 2
- US Experts See Growing Desire to Curb Outsourcing to China
- Re-Shoring and Revitalizing American Jobs
- Elderly Rice Farmers.in Japan. Youtube.
- Desperately Needs Call Center Industry, Philippines on BBC News. Youtube
- Asia's lopsided trade and investment
- Asia's global value chains -- Part 3

8. Urbanization in Asia


Asia is in the midst of a dramatic wave of urbanization.

The movement of people from rural to urban areas can provide a big boost to development, especially since people usually also move from low value added agricultural work to higher value added manufacturing and services work.

Lewis model, and surplus labor. China has reached the "Lewis turning point", where surplus rural labor is exhausted and wages increase substantially.

China's hukou system prevents rural migrants benefiting from social services in big cities like Shanghai.

Urbanization is not however all peaches and cream. One-third of Asia's urban population lives in slums with poor infrastructure and high poverty.

Slums are often located in areas exposed to natural disasters, because they are low cost. Urban centers are often the site of civil unrest of discontented populations, and can be driver of democratization.

Many of Asia's cities suffer from terrible air and other pollution.

In some cases, new Chinese urban settlements are created on land expropriated from peasants with little compensation. And these same peasants may be "forciby urbanized" as they are moved to urban locations.

One consequence of Asia's rapid urbanization is the growing number of "ghost towns", occupied by dwindling numbers of senior citizens.

For Asia to realize the quest for innovation-driven development, it requires "innovation cities", the most dynamic centers of the world economy. They are the human hubs where most innovation takes place.

Boston, New York and several other American and European cities are top of the world's innovation cities league table. Asian cities are further down the list. There is much that Asia can do to foster the necessary "ecosystems" to drive innovation.

REFERENCES:
- ACI. Urbanization and slums in Asia
- Videographic. The largest migration in history
- Chinese labour relations: Worker militancy spreads
- Singapore Budget 2016: Jurong Innovation District
- Kevin McCloud: Slumming It (2010) - Ep1 -- 6 minutes.
- End of the Migrant Miracle: China at the Lewis Turning Point
- China's 13 Million Undocumented: What is 'Hukou'?
- Delhi Ranked World's Most Air-Polluted City
- Hong Kong's pollution problem hits health and businesses
- China's hukou system

9. Socially inclusive development


Certain social groups in Asia have not been able to participate fully in development, notably women and indigenous peoples.

Better participation by women in Japan's labor market could greatly boost GDP and relieve some of the tensions from the country's ageing and declining population. In Asia's developing countries, there are many "missing women" due to the desire to have male children. And due to discrimination, two-thirds of all Asia's poor people are women.

Asia also has some 260 million indigenous people, many of whom suffer from discriomination and poverty.

REFERENCES:
- Womenomics 4.0: Time to Walk the Talk. Goldman Sachs. Youtube and Report.
- The Global Gender Gap Report 2014. World Economic Forum.
- Japan needs more women at work
- China's one-child policy creates massive gender imbalance
- India: The Missing Girls
- Youtube. Is India's Caste System Still Alive?
- Malnutrition and gender equality in India
- Indigenous peoples in Asia. International Work Group for Indigenous Affairs.
- Advancing the rights of indigenous peoples. Youtube.
- Discrimination against Muslims in India

10. Democracy in Asia


The world's richest countries tend to be democracies, while the world's poorest countries tend to have authoritarian regimes. And yet, despite its rapid development, democracy only has shallow roots in Asia.

According to "modernization theory", as countries industrialize and urbanize, and their populations become more educated and prosperous, emerging middle classes will push for democracy, as happened in the cases of Korea and Taiwan.

Indeed, democracy is one of the fundamental freedoms which is at the heart of development.

Countries like China, Singapore and Hong Kong face growing demands for democracy from their populations. However, rather than opening the door to democracy, governments are trying to become more responsive to public opinion, and governing on the basis of a social contract.

When looking at the successful development of China and Vietnam, some commentators argue that authoritarian government is more effective than democracy of the style of India or even the US.

It is true that China's authoritarian government has been successful since 1978, and as has Vietnam's in more recent decades. But neither was not at all successful in previous times. And it is not clear how effective it will be in the future. Non-democratic governments can have difficulty changing course.

The reality is that most authoritarian governments are not benevolent dictators, as in the cases of North Korea, Cambodia, Burma/Myanmar, and much of Africa and the Middle East.

Over the longer term, democracy is key to development. As economies climb the development ladder, democracy and open societies are essential for fostering new ideas, innovation and creativity.

REFERENCES:
- Asia's democracy deficit
- China's democratic future?
- Democracy Index 2013. Economist Intelligence Unit
- The Economist, Special Report: China and the Internet
- Youtube. Factors Contributing to CCP's Inevitable Downfall.
- Youtube. Kishore Mahbubani: Human Rights in Asia.
- Youtube. China's anti-corruption campaign. Kevin Rudd
- Youtube. Burma marks 1988 pro-democracy uprising anniversary
- CLINTON WANTS NORMAL TRADE WITH CHINA
- Youtube. China and the Internet.

11. Asianization of the West


Western countries like Australia, Canada, New Zealand, and the US (and also Japan) are now becoming important destinations for migrants and students from Asian countries. Asian countries, notably China, are also important investors in these Western countries.

Asian tourists are now a growing force, with China now topping the world for outbound tourists. And Asian culture now features much more in art exhibitions, design aesthetic, and food in Western countries.

Are these Western countries slowly becoming "Asianized"? What could this mean for our futures?

REFERENCES:
- The power of Asian Americans
- Asian migration to the West
- Asianizing Australia
- Art and the Asianization of Canada
- Asian migration to Australia
- Canada's Asian migrants
- Asian Americans key for Democrats in 2016
- China's international students
- High Tech: The Next Wave of Chinese Investment in America
- FDI in Canada -- mixed messages

12. Asian case studies -- 1


Japan and Korea are two of Asia's great success stories.

But Japan has never fully recovered from the bursting of its bubble economy over two decades ago. Today it is burdened by large public debt, disastrous demographics, and weak productivity.

Korea developed on the back of big business conglomerates, the "chaebol", which today are holding back the economy.

REFERENCES:
- ACI. Japan's economy -- from miracle to mystery to pious hopes
- ACI. Japan almost made it
- ACI. Japan struggles into Asian Century
- ACI. Korea, the chaebol republic

13. Asian case studies -- 2


Following three decades of stunning economy development, and poverty reduction, China's economy is now at a turning point. It's a case of "now for the hard part".

REFERENCES:
- China's development -- now for the hard part.
- The Great Rebalancing – How China’s Slowdown Will Affect the Globe: An Interview With Michael Pettis
- China’s Economy Is Not in Very Good Health: Man
- World Bank: China's rebalancing act is challenging

14. Asian case studies -- 3


India is a country that has suffered from chronic poor performance. It does however have great potential, but to realize this potential will require drastic policy reforms.

REFERENCES:
- Indian economy on a knife edge
- Colorful India
- Slums of Mumbai
- Bangalore -- high tech industry
- Education in India
- India's crowded trains
- India's toilet problem -- 1
- India's toilet problem -- 2
- Obesity and starvation in India
- India vs. China: The battle for global manufacturing

15. Towards an Asian Community


Successful regional cooperation and integration in Asia would make an important contribution to peace, prosperity, security and stability.

In this context, youth appreciation of Asian pop culture can improve cross cultural understanding in the region, become of vector for soft power, and contribute to regional cooperation and integration. Indeed, Asia's youth may be more capable of achieving political reconciliation than their parents.

REFERENCES:
- Is Asia a region?
- Building an Asian community
- Free trade agreements in Asia
- Asian Development Bank Institute, ASEAN 2030: Towards a borderless economic community
- Joseph Nye, Asian nationalism at sea. Project Syndicate
- A Conversation on Nationalism in Northeast Asia. Youtube.

16. Codependency -- US and China


The US and China are now in a relationship of "codependency", where they are each highly dependent on the other, despite being "frenemies". In fact, following a few decades of Asia's rapid development, Asia and the rest of the world are arguably in a state of codependency.

This has been most vividly illustrated by the reactions of the rest of the world to China's recent devaluation, and the volatility on the Shanghai stock exchange.

REFERENCES:
- The US and China: a Fragile and Dangerous Codependency Relationship - Professor Richard D Wolff. Youtube.
- Unbalanced: The Codependency of America and China. Stephen Roach. Youtube.
- Video: China Devalues the Yuan — Who Wins And Loses? Youtube.
- How will the yuan devaluation affect other countries? BBC
- China's yuan currency devalues for a second day. BBC Youtube
- Presidential candidate Trump: China devaluation will devastate US. Youtube.

17. Asia's demographic dilemmas


Asia is facing a host of demographic dilemmas.

In countries like Japan, Korea, China, Hong Kong, Taiwan and Singapore, birth rates have fallen well below the "replacement rate" of 2.1 per woman, populations are aging rapidly, and in Japan's case, the population has even begun declining.

Government, business and society need to do more to address the factors discouraging childbirth, and to implement more family-friendly policies in the work place.

There is also much more that can be done to alleviate the effects of aging populations -- such as by providing more opportunity to women and youth, raising the retirement age and cutting back on retirement benefits, implementing more open immigration policies, and improving productivity. National demography strategies are necessary.

Countries like India, Indonesia and the Philippines still have relatively high birth rates, and have the potential to benefit from a "demographic dividend" thanks to their large youthful populations. But to exploit this demographic sweet-spot requires providing education and job opportunities. Otherwise, a large, frustrated youthful population could become a demographic time-bomb, leading to social and political instability.

The "demographic diversity" between these two groups of countries provides the opportunity for mutually beneficial migration. Regrettably however, there remain many restrictions on such migration, and many migrants suffer from human rights abuses.

REFERENCES:
- Asia' looming demographic dilemmas
- Asia's wasted migration opportunities
- Marriage migration in East Asia
- ADB. Preparing for Demographic Transition. Youtube
- Japan's experiment in ethnic immigration
- Singapore's migration dilemmas