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Japans High Speed Growth Model - Essay Example
It is a known fact that Japan today boasts as one of the most powerful nations in the world and that Japanese economy is the second largest economy in the world. So we need to understand the factors which took place to overturn the fortunes of a country which was shattered to pieces five decades ago…
the then government of the Meiji took some modernized measures which propelled the economy of Japan later in the 19th and early part of 20th century and by the year 1945 Japan was considered one of the most powerful nations both economically and militarily, and this led to the basic foundation structure of the post war high speed growth. To understand the post war economic miracle in economic terminology we will bring the concept of neo-classical theory of economic convergence. This economic model concept brings out the reality of the Japan's post war economic miracle.
The basis of such model which constituted the high speed growth in Japan was actually brought by two people - Solow and Swan in 1956.Later many people developed the model as per the timeline they lived in. The model provides interesting results. They are termed as follows. Every economy has its own steady state that is to say a kind of growth ceiling to its own possibilities of sustained per capita income growth. This is usually determined by the company's structure of technology and its economic level, rate of savings, rate of population growth and rate of human capital depreciation. The whole scenario can be turned into a mathematical format and can be formalized in the following manner. ...