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When is a 'model' relevant?



On Tue, 25 Aug 1998, Kush Khatri wrote:

> > I am not saying that we follow the HK model; but let us never rule
> it >out without a very strong justification, particularly since that
> model >has created huge amount of wealth for that nation.
> 
> You may see Honkong as a nation, for me it was a city-colony. And
> hence there is no comparison between a city-colony and a huge federal
> state.

Some interesting facts: (approximate)
			Hong Kong	India

Population		58 lakhs	9800 lakhs
	(so far you are right in dismissing this 'peanut' called HK)

GNP per capita		11,490		350	(in USD, 1990)
GDP			60 billion USD	255 billion USD
Value of manufacturing	11 billion USD   45 billion USD
Exports			29 billion USD	 17 billion USD (1990)
Imports			82 billion USD	 23 billion USD (1990)

These are all from World Development Report, 1992 (sorry, this is the one
that I own and am usiing these statistics as illustrative; others, newer
editions, I borrow from libraries whenver required) 

My point: these figures are not corrected for PPP, but even then you get
the feeling, by now, I guess, that HK may be small in area, but in terms
of the clout it carries in the economic world, it can stand up as a major
nation anytime. Its merger with China is only incidental to the argument.
When HK sneezes, the world catches a cold. When India sneezes, the world
barely notices, since the wealth of India is so tiny for a nation its
size, and most people are living at a subsistence level. In the real
world, physical size DOES NOT matter. India is "huge" only in name; it is
tiny in terms of its economic significance. 

Coming back: HK is not central to any argument that we are making, and
this matter can be safely dropped w.l.o.g. (without loss of generality) if
you like. The topic arose incidentally, and is basically irrelevant.

But please let us not dismiss those who are tens, even hundreds of times
more successful than us. That is a tendency we as Indians will have to
outgrow if we are to learn from the clearly visible and obvious 'lessons'
lying all around us. Mancur Olson wrote a paper expressing dismay and
surprise at the 'big bills lying on the sidewalk,' i.e., poor nations not
willing to look around and see the lessons and gain from these lessons. 
Let us, on IP, not follow the footsteps of our ministers who are either
dismissive of small East Asian states, or scared! (remember singapore
airlines!). 

We have been truly humbled by all these tiny ants everywhere around us.

Let us become humble, open our eyes, and find out from these folks what is
going on in their nation that makes them succeed. Neither should we
belittle any person (ph.d/prof) who spends a lifetime studying these
issues. We might learn something from these folks, you know!

SS


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