Tim Worstall

The Hong Kong Lie Nailed

Via The New Economist:

"No
economy ever got rich without using tariffs to industrialise."

This
claim, generally used by developing countries to avoid cutting tariffs,
has a two-word refutation: Hong Kong. Some say Hong Kong’s postwar
success was as a port and financial centre for China. Not true. Being
the entrepot for a country under US and United Nations embargoes and
ruled by an autarkic Communist was not exactly a licence to print
money. Hong Kong did the same as the other Asian tigers – starting off
with clothing and other labour-intensive manufacturing and moving into
more sophisticated products and services later.

In

3 responses

  1. dearieme Avatar
    dearieme

    The problem with applied economics is that much of it is guff about correlations. What you need are controlled experiments. In the absence of same, an attractive thing to do is look at “natural experiments” e.g. compare HK with Red China, South with North Korea, West with East Germany. No doubt you can think of other pairings, Tim.
    Tim adds: Taiwan and the Mainland etc etc.

    Reply
  2. Natalie Solent Avatar
    Natalie Solent

    Great article, but where’s my Britblog roundup?
    Tim adds: Somewhere up above. The mountains were calling today so the early afternoon was spent pedalling a bike up them.

    Reply
  3. Matthew Avatar
    Matthew

    I thought it was well known that Hong Kong did have an entrepot role until 1951, but then it boomed on the back of a vast emigration of reasonably skilled Chinese labour and corporations (mainly from Shanghai). This is not necessarily easy to replicate.

    Reply

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