Late industrialization and its consequences

What was happening elsewhere in Asia? What lessons may India glean from her Asian sisters’ industrialization experiences? These are important questions, relating to the phenomenon of late industrialization in Asia, as India proceeds on her own industrialization trajectory. Industrialization results from a complex collection of cumulative forces acting on each other in transforming an economy from an agrarian and rural character to an urban and industrial character. A key feature of the process of industrialization is the changing composition of output and employment, away from land and agricultural pursuits. The term industrial revolution refers to a series of major quantitative shifts in the trajectories of industrialization based on harnessing the fruits of certain fundamental innovations. The late industrializing countries may not have innovated themselves, at least initially. At a later stage, they may well have created new innovations that might help engender another industrial revolution.

Does late industrialization pay? A clear indication of whether it does or not comes from the evaluation of two sets of data. The late Angus Maddison, in a later work, documented the incomes of different countries stretching back to the year ad 0. The resulting aggregate statistics, of the total gross domestic product generated by each country, are of useful value in understanding where India was placed in the global rankings and where she is placed now, and in comparing her economic performance to that of other countries. The data are in Table A6. Based on these data, I developed two charts comparing, first, India to Japan, and, second, India to the United States. I commence my analysis by comparing Indian and Japanese economic performance from ad 0 to 1998, as computed in 1990 US$ values. The year 1998 was the last one for which the data were computed. These data are plotted on figure 5.1.