Example Of Research Paper On Economic Development Performances Of Egypt And Malaysia: A Comparison
Malaysia and Egypt are two developing countries with different dynamics and characteristics. The majority of the population in both countries is Muslims. Egypt has a higher population Muslim people than Malaysia does. There are important differences between two countries those make an essential distinction between the economic development performances of the two countries.
Malaysia could create a more balanced political system and social system. There are many minorities living in Malaysia, and the Malaysian system could fit all the minorities into itself. Depending on this success, the political system in Malaysia is relatively more stabilized. A stable political environment enables the government to implement its economic development policies. The Malaysian Economy is one of the strongest economies in its region because the infrastructure work of the Malaysian Economy is almost completed.
Egypt has a different characteristic, and there exists a chaotic environment in the country. There is an Islamic group called as the Muslim Brotherhood that spends effort to transform the country into a more religious country. This group is a large group; however, almost 50% of the population is against the Brotherhood. Consequently, Egypt is still facing an internal conflict in the country. Because of that, the economic development has been interrupted. Without developing the peace inside the country, managing economic development is not possible.
In this paper, I will show some basic macroeconomic statistics and explain the development differences between two countries. While comparing the two countries, I will use the Harrison Todaro model. The model compares the income generated from agricultural production and industrial production. As known, many developing countries try to transform its economy from agricultural production economy to industrial and service production economy. This development model will provide us a base to evaluate the economic development performances of the two countries.
The Economic Development Story in Egypt
Egypt has a complex social and political structure. The conflict inside the country has been continuing for long time. The conflict is due to the political fight between the secular group and the Muslim Brotherhood followers. This political and social conflict has created some barriers for the economic development. Egypt, as a developing country, exhibits a terrible economic development performance. The main proof for this is the graph given below.
Graph 1: Economic Growth Rates in Egypt (%)
Graph 2: GDP per Capita
The economic growth is an essential indicator for the economic development. Egypt is very unsuccessful in producing and generating more national income. As can easily be seen in the graph, the Egyptian Economy faces a large failure from 1980 to the current time. At average, the economic growth rate is around 3%, and this growth rate is not enough for a developing country. The GDP per capita statistics also indicates that the Egyptian Economy needs to be more productive. That indicates that the Egyptian Economy is facing some structural problems, and the economic infrastructure is incomplete.
Graph 3: Some macroeconomic indicators in Egypt
The Egyptian Economy also aims at transforming the economy from one concentrated on the agricultural production to one concentrated on industrial production. In the graph above, we observe that the concentration on the agricultural production is decreasing. The contribution of the agricultural production has dropped drastically. However, the number of people working in the agricultural production is not decreasing that fast. Also, observing the industrial production development is not succeeded in the country, there is an economic conflict in the country. For being successful, the Egyptian Economy should have been able to transform the workers from agricultural producers to industrial producers. The graph tells us that the workers could not be transformed successfully. Also, the contribution from the industrial production is not satisfactory.
Consequently, we might claim that the social and political conflict in Egypt has reflected the economy. The Egyptian Economy is exhibiting very unsatisfactory economic development performance. Thinking the Egyptian Economy from the Harris Todaro model’s perspective, it is not possible to say whether the Egyptian Economy is receiving more from the agricultural production or the industrial production. The Egyptian Economy, before developing economic development policies, needs to cope with the political and social conflict and the lack of economic infrastructure. After that, the Egyptian Economy can find a way for economic development.
The Economic Development Story in Malaysia
Malaysia has a mixed community that includes Christians, Muslims, and Chinese people. However, the Malaysian governments could manage to develop a social peace among the different groups. This situation provides a suitable environment for the Malaysian economic development.
The Malaysian Economy is capable of producing a high economic growth comparatively. Also, the social peace in the country helps the society develop new jobs and careers in the country.
Graph 4: Economic Growth Rate in Malaysia (%)
The economic growth rate in Malaysia is around 6% at average. Considering that the developed countries cannot manage to reach this level other than China, the Malaysian Economy performance is quite satisfactory.
Graph 5: GDP per Capita in Malaysia
The GDP per capita statistics indicates that the labor productivity in the Malaysian Economy is quite high compared to the Egyptian Economy. The increasing GDP per capita statistics in Malaysia is an essential indicator that the economic growth policy is working more efficiently comparatively.
Graph 6: Some Macroeconomic Indicators in Malaysia
The Malaysian governments have given more importance to three different economic policy areas: 1) relatively higher productivity in agricultural production, 2) promoting entrepreneurship through microfinance models, and 3) improving the capacity in the high technology industries. Many developing countries follow similar ways for promoting the economic development. The Malaysian Economy has developed some institutions to promote the economic development, and these institutions could develop some formal and informal ways to do their business. For instance, in Malaysia, these institutions are using the social media tools for contacting their stakeholders that are not seen even in many of the developed countries.
The industrial production is contributing more to the Malaysian Economy while the contribution of the agricultural production is at a desired level. The contribution of the service industry is not in the graph. Considering the service industry contribution, we might claim that the Malaysian Economy is a well-balanced and developing economy. Taking the successful reaction of the Malaysian Economy to the Asian economic crisis, the Malaysian Economy is performing well.
Conclusion and the Comparison of the Two Economies in terms of the Harris-Todaro Model
There is an essential difference between the two countries' economies. One has established a stable social, political, and economic environment while the other one has still been facing the conflict in the country. Both countries claim following similar economic development paths. The main aim in their economic growth policy is to transform their economies into a relatively more industrial production and service production concentrated economies.
The Harris-Todaro model simply expresses that a country needs to take incomes generated in different sectors of the economy. The basic logic depends on the comparison of incomes of different sectors. The Egyptian Economy has failed to transform its economy because of the political and social conflict in the country. Their economy is not balanced, and the economic growth performance is below the desired level. Therefore, it is difficult to claim whether the agricultural production or the industrial production is the leader industry in Egypt. The Malaysian economy is a well-balanced and developing economy. The concentration in the agricultural production is decreasing; however, the increase in the productivity of the agricultural production indicates that the Malaysian Economy will continue the agricultural production at a stabilized level. The industrial production and the service industry production are being the relatively better industries. Considering that the Malaysian Economy can generate high technology, we might consider that the Malaysian Economy has succeeded in transforming the economic structure. Continuing a balanced economy sounds like a relatively better idea. The contribution from the services and industrial production is increasing in Malaysia.
Abeyratne, S. 'Economic Development And Political Conflict: Comparative Study Of Sri Lanka And Malaysia'. South Asia Economic Journal 9.2 (2008): 393-417. Web.
Pessin, Al. 'Political Conflict Hurts Egyptian Economy.' VOA. N.p., 2015. Web. 23 Mar. 2015.
Russell, Mona L. Egypt. Santa Barbara, Calif.: ABC-CLIO, 2013. Print.
Snodgrass, Donald R. 'Successful Economic Development In A Multi-Ethnic Society: The Malaysian Case'. Colombia University, 2015. Web. 23 Mar. 2015.
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