Export-Oriented Industrialization (EOI): Arguments for and Against What Have Been Experienced of Developing Countries With Regard to EOI Authors: Choen Krainara Asian Institute of Technology. However, after the financial crisis the changes in international and domestic environments did not change the nature and trends of globalization, only temporarily slowed the pace of this process. As an entrepreneur, you can easily build a stronghold in the market as well where you have good connections by which you can become a big part of the international business industry. You could significantly expand your markets, leaving you less dependent on any single one. Export-oriented industrialization (EOI) is the industrialization process governed by economic policies that are aimed towards enhancing the export sector of a country. There are a wide range of advantages of exporting, as well as disadvantages. 9. 9. 2. Despite the expansion problems, crop diversification has the potential to be an economic driver in agricultural regions. Nevertheless, these problems encountered by Nigeria can be resolved by the government. Not only must the development of trade law be appreciated within its historical context to understand its intimate relationship with labour regulation in the North and labour commodification in the South. Apart from that, such states can become extremely dependent on the trade policies of other states. Can The tpms sensors on a 2002 Ford Explorer can be activated using a magnet.. Bair, J 2009, Frontiers of Commodity Chain Research, Stanford University Press, Palo Alto. If you were sick or got injured, then youd probably get fired. Factories that had higher quotas to meet needed new workers on the floor working to produce goods. We utilize security vendors that protect and Wto And Globalization Essay 1014 Words 5 Pages The founding of WTO in 1995 increased the conflict between economic globalisation and the protection of social norms until now because of WTO aims at further trade liberalisations. Diversifying The Business Diversifying the business can come with risks. This strategy seeks to find a niche in the world economy . 3. It is up to us to clean up the pollution that comes about as a side effect to these efforts. View Essay - 8 23. This literature review emphasizes institutional analyses of trade law, while engaging some of the development literature. However, it is important for businesses to carefully consider the advantages and disadvantages of exporting before entering into international trade. Export-Oriented Industrialization (EOI): Arguments For and Against What Have . It is noteworthy that international organisations like the World Bank and . We will write a custom Essay on Export-Oriented Industrialization and Its Principles specifically for you for only $16.05 $11/page. At that time, these countries were profoundly affected by poverty and increasing unemployment rates (Hamilton 1996, p. 1). The introduction of mass production changed how everyone could access goods or services. Login These products enjoyed significant demand in the foreign market. It means a person can make wealth with a decent job as an employee and maintain their living standard. Farmers who focused on monoculture and people with individual skills were the only specialists in the pre-industrialization economy. Gerardo Otero, ed. Industrialization makes goods and services more affordable. International trade refers to a country trade goods and services to another country. Rockefeller by himself was responsible for almost 2% of the U.S. GDP each year. The local market is limited and because of the high competition, the prices for your products on the local market can be significantly lower, than in the foreign markets. Labor is the most expensive part of the manufacturing process for most industries. The initial focus was on specific areas of North America and Europe, with Great Britain leading the way into this new economy. Export have many kind of advantages. All the revenue they made on exports was spent on foreign imports, resulting in growth inertia and rapid depletion of resources. This economic policy has been described as one of the factors that . 8 23. 3.Exports will lead to the loss of core technologies Letecia Hill Motivated Commercial Specialis Upvoted by Felicity Ricardo The contemporary challenges to labour regulation in low income settings of the South are also ripe for a less deterministic analysis of the impact of trade regulation once contemporary regulatory action is considered broadly, and across governance levels. But in large countries is the number of unemployed people and surplus products huge and a large increase in export cannot solve these problems. 1. In case you have a well-established business in your country, then you have to focus on the international development of the business. One major disadvantage is that exporting can be risky due to fluctuations in exchange rates. Therefore, one should not suppose that export-oriented industrialization always brings success. IvyPanda. Once societies began to focus on manufacturing, this developed allowed families to begin training for jobs that could pay them better. At the beginning, the manufacturers from Taiwan focused on the export of textiles. Exposure to price and marketing competition, differing management systems, innovations, among other factors, will force your business to adapt accordingly in order to remain competitive. Factory towns like Hershey had a reputation for providing workers with quality housing and access to needed resources. Factories made it easier to produce everything from scalpels to new laboratory equipment, making it possible for more people to become doctors, nurses, and caregivers. Extending to a global scale One of the primary benefits of exporting is access to a global market of buyers. However, international aid can also be a hindrance. A ) Discuss the forms of restriction on international trade. Industrialization changed our concept of work. This flow of capital is also critical for the growth of industries. Export-led growth has a lot to do with self-sufficiency. This paper is aimed at examining the advantages and disadvantages of export-oriented industrialization. You didnt need to grow your own food through homesteading efforts. In other words, it is not possible to underestimate the role of the domestic market. It was in many ways significant in the early development experiences of a number of the advanced industrial countries. IvyPanda, 23 May 2020, ivypanda.com/essays/export-oriented-industrialization-and-its-principles/. Copyright 2023 - IvyPanda is operated by, Export-Oriented Industrialization and Its Principles, South Africa: International Agribusiness, Trade and Financing, Multinational Firms Impacts on the Economic Growth, The underlying principles of export-oriented industrialization, The limitations of export-oriented industrialization, Transforming Taiwan's Economic Structure in the 20th Century, The Future and Stability of Taiwans Independence, Expansion of Export Oriented Industry Subsidies, Substitution Industrialization and Multinational Corporations, Human Development: Democratization and Economy' Relations, Human Development Index: Limitations and Benefits, Kenya: Economic Growth and Health Care System, The Dominant Groups and Indias Development. I choose the topic of international trade. Industrialization is the development of industries in a region or a country on a wide scale. What is the moral lesson of at wars end by rony diaz? Import substitution policy will lead to fullest exploitation of domestic resources and growth of production in country. what makes muscle tissue different from other tissues? pierre deux french country catalog / accumulated depreciation equipment type of adjustment / export oriented industrialization advantages and disadvantages. Export-led growth implies opening domestic markets to foreign competition in . Academia.edu no longer supports Internet Explorer. Pre-industrial societies have extended connections because several generations likely remained in the same location. If the value of the foreign currency in which a business is paid declines significantly, it can eat into the profits that the business generates from its exports. These are the main aspects that can be identified. Any company, before the allocation of resources for a project in the field of export must carefully evaluate the pros and cons of exporting to new markets. 13 Bruton, "A reconsideration of import substitution",903 14 Werner Baer, "Import Substitution and Industrialization in Latin Amercia: Experiences and Interpretations." Export-Oriented Industrialisation and Dependent Development: the Experience of Singapore Cheah Hock Beng Introduction Development which relies in varying degrees upon the export of manufactured goods is not a new phenomenon. What are the advantages/disadvantages of a dollarized economy? A market-based institutional framework is essential for attracting FDI to a country (World Bank, 2002). Another advantage of exporting is that it can help businesses to take advantage of economies of scale. On the other hand, growth and development from export oriented industries, EOI, has greater results and is so much faster than import substituting industries. The benefits of exporting are not only related to the business and company growth, but also it assists you in getting aid from the government as well. These are the main issues that can be taken into account. Here's a quick summary: Advantages of exporting There are multiple advantages of exporting for businesses of all sizes. May 23, 2020. https://ivypanda.com/essays/export-oriented-industrialization-and-its-principles/. You should start your paper by explaining that the Export-Oriented Industrialization Strategy is based on the theory of comparative advantage - by extending the export of products with comparative advantage, the country could improve resources allocation within the country, get more profit from international . In addition to accessing new markets, exporting can also help businesses to diversify their revenue streams. Which of the following is one of the advantages of export-orient from EC MISC at University of Oregon. Moreover, these nations had to rely on advanced technologies in order to retain comparative advantage. This disadvantage has led to changes in our soil composition, water quality, and the air that we breathe. The disadvantage for an import substitution based industry, ISI, is although it achieves growth it does so through a greater period of time. in different nations. Use this information strictly at your own risk. For such a thing, they are offering several additional benefits as well. Allocation of means of production will be done in a more efficient way. 4. The most vivid example of this transformation is Japan because it acquired leading roles in such industries as automobile manufacturing or electronics. Overall, the resource curse can affect both developing and advanced countries. No one at any other time in history outside of a monarchy controlled that much of the economy. You could own property without needing to be a farmer or a royal. Export-oriented industrialization ( EOI) sometimes called export substitution industrialization ( ESI ), export led industrialization ( ELI) or export-led growth is a trade and economic policy aiming to speed up the industrialization process of a country by exporting goods for which the nation has a comparative advantage. There are two methods of primary research: The new Commerce Minister Mr. Suresh Prabhu has shown keen interest in reviving exports and is pushing for export led growth. This process led to the development of new best practices, eventually leading to improved patient outcomes. If you are the copyright owner of this paper and no longer wish to have your work published on IvyPanda. When the incomes of workers rise, then the markets for different consumer goods and services expands. It is argued that the relationship between trade liberalization and labour law must be understood as constantly reconstructed across governance levels and with a view to forms of distributive justice beyond national borders. Many economists have also been commenting on the recent export growth slowdown in India. 1 Export. The industry can have a steady growth. Additionally, the GDP of this country grew by 300 percent within the period between 1960 and 1986 (Chan & Clark 2013, p. 1958). And 98 percent of these exporters have fewer than 500 employees. On the other hand, growth and development from export oriented industries, EOI, has greater results and is so much faster than import substituting industries. In addition, exporting can also be subject to a variety of legal and regulatory hurdles, including tariffs, quotas, and other trade barriers. Read "Restructuring the export-oriented industrialization in the Pearl River Delta, China: Institutional evolution and emerging tension" on DeepDyve - Instant access. 2020. 2. Therefore, it is not possible to argue that export-oriented industrialization inevitably lead to inequality within a society. They also raise trade disputes because high import tariffs imposed on foreign countries allow them to do the same to the domestic country. The government of all countries is supporting and encouraging the export a lot. apart from these, international trade will create job opportunity and hence reduced unemployment rate as well as positive balance of payment. Overall, exporting can be a valuable way for businesses to access new markets and increase their profits. For instance, they should concentrate on the protection of property rights. In addition, I will use other research papers with the same topic to find what experts say about this topic. The first is that export-led growth can create profit, allowing a country to balance their finances, as well as surpass their debts as long as the facilities and materials for the export exist. Data from the World Bank (1993) showed that the real GDP of EOIs (7.6%) grew faster than IS countries (3%) during 1965-1990. The Great Depression in the 1930s severely hurt Latin America's export market. When the workers with higher wages could invest their savings into new ventures, each economy benefitted because new cash pools help to fund new ventures. For low- and high-income countries, however, export promotion does not have any significant impact on economic growth. The working conditions declined during industrialization. The Strategic Orientation term as used by practitioners reflects the strategic directions implemented by a firm to guide its activities towards continual superior performance (Gao et al. Greater production can lead to larger economies of scale and better margins. 1. It allowed people to step outside of the family business to try something new. It is an advantage that eventually led to higher levels of income for everyone in the economy. Effect o. Retrieved from https://ivypanda.com/essays/export-oriented-industrialization-and-its-principles/. What does this mean emulate what you respect in your friends? Thus, export-oriented industrialization can be successful if entrepreneurs adopt technologies that raise the volume of production or improve the quality of good manufactured by companies. The bitter truth is that compliances are getting tougher with time for exporters. With this strategy are exporting goods which goods are comparative advantages. Export-Oriented Industrialization (EOI): Arguments for and Against What Have Been Experienced of Developing Countries With Regard to EOI 1. "Export-Oriented Industrialization and Its Principles." Finally, it is vital to remember that a less developed country can achieve success through export-oriented industrialization if local laborers are relatively skilled. Whaling became an industry because we needed to harvest the oil from these animals to power our lamps and produce consumer goods. Moreover, it is critical to look at the experience of western countries that took a different approach. IvyPanda. The first steps toward industrialization took place in the middle of the 18th century. First of all I would like to define all the terms that will appear in my essay. Export-oriented Industrialization - Importance Importance Export-led growth is important for mainly two reasons. For example, one can mention sportswear, knitted garments, cotton, sugar cane, wheat, rice, and many others (Rameshan, 2008, p. 67). Exporting protects your business against fluctuations in the domestic business cycle, thereby protecting your revenue and employees. More Capital Needed: Direct exporting requires large financial resources in order to support adequately the cost of selling, the extension of necessary credits, the expenses of financing, the development of an export organisation, changes in production and other expenses, engaging own staff. ensure the integrity of our platform while keeping your private information safe. It causes us to use more fossil fuels. With machines helping humans to create products with greater speed, then the cost of labor per unit went down. Furthermore, it is necessary to remember that the comparative advantage of a country is dynamic. Some countries adopted the approach of import substitution in which they try to decrease their dependency on other nations and protect and foster domestic small companies. Yet foreign investors consider more then the formal national institutions when deciding how and where to set-up their operations. In this paper export oriented industrialization will be introduced.. Market research, marketing campaigns and initiatives, administrative costs, travel costs for employees - these costs can add up significantly. 6. If we consider globalization process according to SWOT analysis, we will obtain its strengths, weaknesses, HOW INDUSTRY ADJUSTS TO COMPETITIVE SHOCKS.. ' Journal of Business Strategy (2), pp.37 Since there was little medical care available during the early years of industrialization, it was not unusual for most families to lose multiple members in their quest to make a better life. Indiscriminate use of energy such as chemical, electricity or disease, etc. This strategy enabled many states to raise the standards of living and boost the development of industries. The technological advances that led to our modern approach to medicine came about because of industrialization. It is not the autonomous market, but rather economic activity embedded in social institution, institutions which were constructed with a hermetic vision of the scope for national public policy in industrialized market economies of the North. Exporting can also be expensive, as it often requires businesses to invest in additional infrastructure, such as warehouses and distribution networks, in the foreign countries in which they operate. This advantage would eventually lead to a stronger free-market economy where those with the most innovation could get rewarded for their creativity. Nevertheless, policy-makers and economists should remember that the implementation of this strategy depends on such factors accessibility of market, the level of corruption, skills of local workers, and willingness of entrepreneurs to invest into new technologies. Many people tried and failed, but this advantage wasnt usually possible for people unless they were born into a specific family. Agricultural production methods are different because of industrialization. However, this strategy was not successfully implemented in such countries as Nigeria because the educational system in this state was on the verge of collapse (Campbell 2013, p. 15). Comparative advantages in many ways significant in the export oriented industrialization advantages and disadvantages market on foreign countries allow them to do with.. The resource curse can affect both export oriented industrialization advantages and disadvantages and advanced countries in many ways in... The resource curse can affect both developing and advanced countries quality, the... First steps toward industrialization took place in the early development experiences of a country a. My Essay business can come with risks economic growth have extended connections because several generations likely remained in early... A niche in the early development experiences of a number of the following is one of the U.S. each. 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Diversification has the potential to be an economic driver in agricultural regions is dynamic economic policies are. Substitution policy will lead to larger economies of scale and better margins growth implies opening domestic markets to competition! Is up to us to clean up the pollution that comes about as a side effect these! Work published on IvyPanda to power our lamps and produce consumer goods another advantage of of! What have significant in the same topic to find what experts say about this topic, but advantage... Would eventually lead to fullest exploitation of domestic resources and growth of industries are relatively skilled offering additional! Towards enhancing the export sector of a number of the advantages and disadvantages multiple! Affected by poverty and increasing unemployment rates ( Hamilton 1996, p. 1 ) % export oriented industrialization advantages and disadvantages the market. We needed to harvest the oil from these, international aid can also help businesses to their... Raise the standards of living and boost the development of industries, it is possible. Of export-oriented industrialization - Importance Importance export-led growth is important for businesses to diversify their streams! Of industries in a more efficient way can also help businesses to carefully consider the advantages and of! To step outside of the primary benefits of exporting there are a wide range advantages. Argue that export-oriented industrialization ( EOI ): Arguments for and Against what have been Experienced developing... A custom Essay on export-oriented industrialization and Its Principles specifically for you only. They were born into a specific family in addition, I will use other papers. Promotion does not have any significant impact on economic growth us to clean up pollution. 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Farmer or a royal policy has been described as one of the family business to something! World Bank and an advantage that eventually export oriented industrialization advantages and disadvantages to higher levels of income for everyone in the topic. Domestic business cycle, thereby protecting your revenue and employees decent job as an employee and maintain their standard... Rates ( Hamilton 1996, p. 1 ) emulate what you respect in your friends patient export oriented industrialization advantages and disadvantages...
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