ECONOMIC DEVELOPMENT IN NIGERIA USING CHINA AS CASE STUDY- quick article

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ECONOMIC DEVELOPMENT IN NIGERIA USING CHINA AS CASE STUDY- quick article

 

In 1978 after years of state control of all productive assets, the government of china embarked on a major productive program of economic reform. In an effort to awaken the dormant economic giant,

  1. It encouraged the formation of rural enterprise and private businesses
  2. Liberalized foreign trades and investment
  3. Relaxed state control over some prices
  4. Invested in industrial production
  5. Educated its workforce

These decision birthed just two things which eventually lead to china’s economic boom

  • Capital Accumulation (growth in the countries stock of capital assets which include factories, manufacturing machineries and communication systems  accounted for 65% of pre 1978 growth while labour accounted for 11%. But during the post 1978 growth, capital accumulation and labour all together accounted for 58% a slide of almost 25% points as increased worker efficiency made up the rest)
  • Increases Worker efficiency (a sharp and sustain increased in productivity)

It turns out that it is higher productivity that has performed this economic miracle in Asia. Between 1979 and 1994 the Chinese economy increased at 3.9% compared with 1.1% during 1953-1978. By early 1990’s productivity share of output growth exceeded 50% while the share contributed by capital formation fell by 33%

 

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