 Physical capital accumulation in Asia 12: Past trends and future projectionsEtsuro Shioji and Tuan Khai Vu Japan and the World Economy, 2012, vol. 24, issue 2, 138-149 Abstract: The pace of capital accumulation in East Asia has simply been stunning. In this paper, we investigate sources of this fast accumulation and make projections for the future. We estimate a “convergence” equation for physical capital per capita, which is derived from an open economy growth model, using a pooled cross-country, across-decade sample of the entire world. We also conduct projections for the next two decades. We find that an economy with a low level of capital stock per capita tends to experience faster accumulation subsequently. Asian economies have certainly benefited from this “convergence effect”. But on the other hand, other factors such as a low rule of law score and high investment goods prices have worked against them. Our projection shows that, if those economies wish to maintain their current pace of fast capital accumulation, the keys would be to reduce distortions in the domestic market and to improve the quality of institutions. Keywords: Capital stock; Investment; Asia; Economic growth; Cross country regressions; Projections; Asian economies (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:japwor:v:24:y:2012:i:2:p:138-149 DOI: 10.1016/j.japwor.2012.01.011 Access Statistics for this article Japan and the World Economy is currently edited by Robert Dekle and Yasushi Hamao More articles in Japan and the World Economy from Elsevier |
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