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Factor Accumulation without Diminishing Returns: the Case of East Asia

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Author Info
Peter Debaere
Ufuk Demiroglu

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Abstract

We investigate the similarity of the country endowments of the newly industrialized East Asian countries (NICs) and their major developed trading partners since the 1960s. In particular, we analyze their factor endowments in the years 1965, 1977, and 1990, using the lens condition of Deardorff (1994). Because of the similarity of endowments of the NICs and their developed-country trading partners, we cannot reject the hypothesis that these countries are diversified economies, able to produce the same set of goods since the 1960s. This empirical evidence supports the theoretical analyses of the East Asian growth miracle of Mankiw (1995) and Ventura (1997) in an environment in which factor accumulation did not imply decreasing returns to capital. Copyright © 2006 The Authors; Journal compilation © Blackwell Publishing Ltd. 2006.

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Publisher Info
Article provided by Blackwell Publishing in its journal Review of International Economics.

Volume (Year): 14 (2006)
Issue (Month): 1 (02)
Pages: 16-29
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Handle: RePEc:bla:reviec:v:14:y:2006:i:1:p:16-29

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