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Chapter 11 – The Asia Pacific Region
Discussion Questions
1. Define:
2. Explain why China’s economy languished for the last 500 years, but has now burgeoned in the last 20.
In the 15th Century China was the most advanced society on earth. Indeed, important technologies such as
3. Why has Japan’s economy faltered?
Japan’s fast growth in the 1970s and 1980s amazed the world. Came the early 1990s and Japan’s
economy came up with a stunning surprise. Almost abruptly it slowed, sputtered, and stalled. Stagnation
set in and tenaciously persisted. Four explanatory themes have emerged; each has a basis in observable
fact: 1) Japan’s faulty economic policies; 2) their inept political apparatus; 3) their disadvantages from
global circumstances; and 4) their cultural inhibitions.
Each of these four has their proponents, each their own rationale. So let’s examine each separately.
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© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not
authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated,
forwarded, distributed, or posted on a website, in whole or part.
Chapter 11 – The Asia Pacific Region
First, please notice that when you control for purchase price parity (PPP) in the per capita GDP
calculations Japanese growth simply wavered during the 1990s. That is, the PPP calculation takes into
account deflation and most simply illustrates the average wellbeing of the Japanese people. Yes, per
capita income fell, but so did prices. You can see that Japan pretty much avoided the Asian financial
2. The Political Explanation. Views of economists on Japan’s crisis have not been the only ones heard.
Political pundits also rose to the challenge. They found two major villains: Villain #1: The Country’s
Long Entrenched Liberal Democratic Political Party. Villain #2: The Hidebound Japanese Bureaucracy.
3. Global Circumstances Have Hurt. The third explanation for Japan’s end-of-the-century economic
problems has more to do with three circumstances beyond their control.
First, the Japanese population, like the western European is shrinking faster than the American. While
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© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not
authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated,
forwarded, distributed, or posted on a website, in whole or part.
Chapter 11 – The Asia Pacific Region
4. The Cultural Explanation. In the mid-nineties, we became aware of what might be called “The
4. What explains the fast growth of the four “Asian Tigers?”
The most rapidly growing economies in this region during the 1980s and 1990s were the group
sometimes referred to as the Four Tigers (or Four Dragons): Hong Kong, South Korea, Singapore, and
Taiwan. Often described as the “East Asian miracle,” they were the first countries in Asia, after Japan, to
move from a status of developing countries to newly industrialized countries. In addition, each has
1 Mariko Sanchanta, “High-Speed Rail Approaches Station,” Wall Street Journal, January 26, 2010, online.
2 David McNeill, “In Bleak Economy, Japanese Students Grow Frustrated with Endless Job Hunt,” Chronicle of Higher
Education, February 7, 2010, online.
3 Tomoyuki Tachikawa, “Exports Boost Japan’s GDP Growth,” Wall Street Journal, February 15, 2010, online.
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© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not
authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated,
forwarded, distributed, or posted on a website, in whole or part.
Chapter 11 – The Asia Pacific Region
S. Korea exports such high-tech goods as petrochemicals, electronics, machinery, and steel, all of
which are in direct competition with Japanese and U.S.-made products. In consumer products, Hyundai,
5. Compare the growth successes and potentials of India and China. List the advantages and
disadvantages of each.
Which factors will be problems for India? For China?
The factors that existed to some extent during the economic growth of NICs were:
Political stability in policies affecting its development
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© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not
authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated,
forwarded, distributed, or posted on a website, in whole or part.
Chapter 11 – The Asia Pacific Region
6. Discuss the problems a marketer might encounter when considering the Marxist-socialist countries
as markets.
In Asia both North Korea and China fit the description of a Marxist-socialist country. Of course,
China has been heading toward free-enterprise quickly during the last 20 years, but much of the old
7. What are the market opportunities and challenges in The Greater China?
In the long run the economic strength of China will not be as an exporting machine but as a vast market.
The economic strength of the United States comes from its resources, productivity and vast internal
8. What are the political issues swirling around the strong trade relationship between the U.S. and the
PRC?
9. Briefly describe three examples of strategies of MNCs in China and in India.
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© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not
authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated,
forwarded, distributed, or posted on a website, in whole or part.
Chapter 11 – The Asia Pacific Region
a. In China, General Motors maintains an important joint venture with Shanghai Auto, Yum! Brands is
b. Prominent among American strategies in India are IBM’s huge investments in the IT industry, Coca-
10. Should the United States fear China’s emergence? Why or why not?
No. The military threat so often used by politicians in this country is exaggerated. We should also mention
that Chinese leaders often exaggerate the military threat of the U.S. for their own policical purposes, as
well.
11. Do you expect that China, then India, will follow the growth paths of Japan and South Korea? What
factors are similar across the countries, and what is unique about each of these four?
12. Describe the opportunities and threats of entering the market in Bangladesh.
13. Describe the economic interaction of China and its northern neighbors.
In the old, planned economy, Northeast China used to be the most industrially and technologically
advanced part of the country. It had a petrochemical, steel, and heavy industry base with a large number
of state owned enterprises. Liaoning province was once the largest industrial center, after Shanghai.
Northeast China, however, remains an important sub-economy of the country although it is lagging
behind the dynamic economic growth of the other three sub-economies.
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© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not
authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated,
forwarded, distributed, or posted on a website, in whole or part.
Chapter 11 – The Asia Pacific Region
With just a four-hour flight from Japan and a large Japanese-speaking population – more than 70,000
people speak Japanese fluently in Liaoning province – it is no wonder that Japanese investors have been
flocking into the city of Dalian. Some Japanese managers explain that Dalian is to Japan what Mexico is
With more than 40% of the city space covered with grass and trees today, Dalian has transformed itself
into a green city from a seriously polluted heavy industry base. The growth of a software industry
partially contributed to this dramatic change. Dalian High-Tech Industrial Park has witnessed an output
value of $40 million in the software development businesses outsourced from the Japanese and South
Korean companies.
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© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not
authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated,
forwarded, distributed, or posted on a website, in whole or part.
Chapter 11 – The Asia Pacific Region
14. How are China’s marketing strategies abroad similar to and different from those of American firms?
American firms have most of the most valuable brand names in the world. Companies such as Apple and
Proctor & Gamble offer a wide set of branded products to high-income and low-income consumers
15. What can the United States, Europe, and China learn from the experiences of Japan during the last 20
years? The first lesson to be learned from Japan’s boom/bust history is about the dangers of fast growth.
4 Mariko Sanchanta, “High-Speed Rail Approaches Station,” Wall Street Journal, January 26, 2010, online.
5 David McNeill, “In Bleak Economy, Japanese Students Grow Frustrated with Endless Job Hunt,” Chronicle of Higher
Education, February 7, 2010, online.
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© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not
authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated,
forwarded, distributed, or posted on a website, in whole or part.
Chapter 11 – The Asia Pacific Region
the world are using Japan as a model for policy making as Japan has been the first to manage a big
recession and its fast-graying population by strategically growing government debt.6
6 Tomoyuki Tachikawa, “Exports Boost Japan’s GDP Growth,” Wall Street Journal, February 15, 2010, online.
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© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not
authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated,
forwarded, distributed, or posted on a website, in whole or part.
