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Essay / BRICS: Pillars of Economic Growth - 1767
BRICS is the acronym for developing countries comprising Brazil, Russia, India, China and South Africa. These five countries, even if they are located in different geographical areas, have one thing in common: economic growth. One might wonder why these countries are growing so quickly than other developing countries. This question will be answered in the document. This article will examine the key factors of economic growth in the above countries. Second, it will explore the reasons for their faster growth than neighboring developing countries. Human CapitalOne of the main key factors in economic growth is human capital. Both BRICS countries have highly skilled workforces. The stock of knowledge accumulated by employees has led to an increase in GDP. Human capital can promote economic growth indirectly or directly because it is the only tool that can be combined with know-how to improve efficiency and innovation. This was explained in the endogenous growth model formulated by Romer (1986); that the accumulation of knowledge can be combined with physical capital to produce results. Ideas generate innovation that can improve economic growth and increase production. Second, technology is an invention created by human capital. These BRICS countries have improved significantly since the early 1990s. For example, China and Russia have both developed human capital equivalent to that of other Western countries. This well-skilled workforce is the driving force of the BRICS countries. Population growth is another factor causing accumulated human labor, as a huge population will consume more resources. With this pressure, more labor will be used for production. Capital Accumulation Capital accumulation is another factor of economic growth. Capital...... middle of paper ...... with »: The Quarterly Journal of Economics, VOL. 70, no. 1. (February 1956), pp. 65-94________________________________________________________________________________Kushil Kumar Haldar. “Economic Growth in India Revisited”: An Application of Cointegration and Error Correction Mechanism. South Asian Economic Review 2009 10:105________________________________________________________________________________________________Lind Yueh. “What’s Driving China’s Growth?” » National Institute of Economic Review 2013 223: R4________________________________________________________________________________www.imf.org http://www.idc.co.za/images/Content/IDC_research_report_BRICS_trade_performance_focusing_on_South_Africa.pdf http://www.bloomberg.com/news/2013-06-26 /emerging-markets-FDI-inflows-top-nations-advanced-for-the-first-time.htmlhttp://unctad.org/en/PublicationsLibrary/webdiaeia2013d6_en.pdf