Flying Geese Pattern of Industrial Development

 


A model that has often been used to describe the industrial growth in South Asian economies, the flying geese pattern, describes the shifting of industries from advanced economies to the developing ones. The dominance of an industrial sector in a region depends on the availability of required resources, including labour, capital and raw materials for the sector, at low costs in comparison to other regions.

This paradigm, proposed in 1960s by Kaname Akamatsu, suggests that an industry shifts from a developed economy to the developing economies as the nature of resources available in an economy changes over a period of time. This is referred to as dynamism in factor endowment. A trickle down effect is observed in terms of technological know-how from advanced economies to the less developed countries. The inverted V-shape of the flying geese pattern depicts a leading economy and others that gain from a trickle-down effect.

For instance, textile industry is a labour-intensive sector that requires unskilled labour. Decades back, Japan was a leader in the textile industry. With technological advancements, Japan gained strength in skilled labour intensive sectors apart from capital intensive sectors. As generations reaped the benefits of industrialization in the form of high wages, cheap unskilled labour was no longer available at a low cost. Such industries thus thrived in Korea, Taiwan and other South Asian economies which were at early stages of industrial development. This is because unskilled labour was available in plenty and at low wages. As these economies developed and diversified to capital intensive sectors, textile industry flourished in countries such as Bangladesh.