Long-run protection: Determining key features of growth and sustainability in Northeast Asia

Abstract

This chapter attempts to advance understanding of the crucial links among growth, technological change, human capital accumulation, and openness and their impact on greenhouse gas (GHG)-related research and development (R&D) output in East Asia, specifically China, Japan, Korea, and Taiwan. Looking at the 1952-2004 period, I test not only for the impacts of a science and technology (S&T) and innovation set of GHG-output related inputs, but also test for the presence of the Environmental Kuznets Curve (EKC) in terms of the GDP-CO2 emissions relationship. This research builds upon the works of various important growth theorists, including Solow (1956, 1957), Nelson and Phelps (1966), Mankiw et al. (1992) and especially Benhabib and Spiegel (1994, 2002). The latter demonstrated the role of human capital on technological development (or more specifically technology catch-up) between 72 and 86 nations over extended periods of time, 1965-1985 and 1960-1995, respectively. In all of these studies, however, there is a limited role for openness to trade, capital, or technology in explaining variations in growth rates across countries. Nevertheless, and although certainly still controversial, many of the studies that have been done on East Asia and its so-called economic miracle" argue that it is greater openness to trade, capital flows, and technology that have distinguished the East Asian experience from that of Latin America, Africa or other regions of developing countries.