Hong Kong And Venezuela
Hong Kong and Venezuela
Hong Kong has built economic strength from an impoverished economic infrastructure, since the 1950's, at the same time as Venezuela's economic health has declined despite its relatively strong economic structure. Figure 1 shows that in 1950, Hong Kong's income per person was approximately half of Venezuela. During that period, Hong Kong came under tremendous economic and social pressure due to an arrival of immigrants from China and a lack of natural resources to support growth. In the interim, Venezuela was resource-rich and had a relatively stable population. Comparisons in the 1990s showed Venezuela's income per person was much lower than 1950 in real terms while Hong Kong's was noticeably greater http://www.hku.hk/hkcer/articles/v57/walker
While Venezuela's economic decline may be attributed to its high population growth negatively impacting economic growth, it can be proved that Hong Kong also experienced tremendous population growth over the past few decades (Figure 2). In addition, Hong Kong lacked the natural resources to support its population growth and resorted to importing all its basic needs to support the economy.
The variation in economic performance can be attributed to the differential economic freedom between the two countries. Figure 3 shows that during the 1970s and through the 1990s, Hong Kong continued to achieve higher levels of economic freedom than Venezuela. More importantly, economic freedom in Venezuela deteriorated during the same period. By 1997, Hong Kong had over 50% more economic freedom than Venezuela (Figure 4). However, such comparisons are not rare when viewing global economies as stories of economic asymmetries abound around the globe.
http://www.hku.hk/hkcer/articles/v57/walker.
Although some economists believe economic freedom cannot be measured, physicist Enrico Fermi pointed various comparisons. What Fermi emphasizes is that when we make a...
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