Tag Archives: developing nations

02.07.2013 | Do Brazilians or Russians Work Shorter Hours?

Brazil or Russia?

Who tends to work shorter hours?
Who takes longer lunch hours?
Who watches more TV?
Who is more likely to sleep 8 hours or more each night?

Brazil was the correct answer to every question.

My source of data was a Jana emerging markets survey. Gathering information during 2011 and 2012 from 11,687 respondents, their goal was to demonstrate how different cultures define “The Good Life.”

For me, though, the information illustrated just how much developing economies differ. Far from “one-size-fits-all,” the world economy has cultures that work harder and those that lunch more. In some places, 4 hours are an average night of sleep while elsewhere 8 are more typical. Also, where you vacation and how often you watch TV vary. It all depends on what you call home.

I wonder how much the information in Jana’s infographics (below) correspond to these World Bank growth projections for the developing world. Compared to the higher income nations, you can see that emerging markets could be fueling the world economy during the next several years. But might our specific data provide clues about which nations will lead?

Sources and Resources: I suggest looking at more of the Jana infographics here and here. For a more academic perspective, the World Bank report has the details and was the source of my growth table.

Posted by: adminEcon
Tags: Brazil, businesses, consumers, developing nations, emerging markets, India, Jana, lunch hour, night's sleep, Philippines, Russia, TV watching, vacation trips, work hours
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11.16.2012 | Pooches and Prosperity

Chloe and Gus, my daughter’s miniature Pomeranians, consume organic dog food and use wee-wee pads, they visit the vet, the groomer, and enjoy their treats and toys. Because of Chloe and Gus, my cats, and the dogs in 1 out of every 4 households in the US, we have a growing pet industry.

I started listing the discretionary spending that supports Chloe and Gus after reading about the Euromonitor Dog Index for 53 countries. Here are some facts that connect pooch spending to prosperity:

Averaging one dog in every 4 households, the US has the world’s largest pooch population. But Norway does the most per capita pup spending at $639 while Switzerland and Australia ranked 2 and 3.

In the developing world, Brazil, with a more affluent urban population, has the most small dogs per capita. But the biggest proportional increase in dog ownership was led by India, and then the Philippines, Venezuela, Russia, and Argentina. Still though, while dog ownership in India rose 58% during the past 5 years, they have only 4 dogs per thousand people. By contrast, dog ownership in the Middle-East is much less popular. In Saudi Arabia and Egypt, with only 2 dogs for every thousand people, dog ownership is rare and typically relates to big dogs and security.

Finally, the financial woes in the euro-zone appear to have affected dog ownership. France, with a sagging economy and Greece, on the brink of economic cataclysm, have fewer dogs than 5 years ago.

Our bottom line: Chloe and Gus are much more than family dogs. Dog ownership can be an indicator of a country’s economic growth and decline.

Sources and Resources: My facts on dogs are primarily from the Atlantic article and from a marketplace.org report. You might also enjoy this Bloomberg article on a NJ legislative proposal for mandating doggy seat belts and Governor Christie’s response. Finally, these econlife links look at aspirational purchases in the developing world.

This chart is from the Atlantic article cited above.

Please note that this post’s conclusion was edited after it appeared.

Posted by: adminEcon
Tags: Brazil, developed nations, developing nations, Dog population, dogs per household, economic growth, emerging markets, euro zone, Euromonitor, France, Greece, large dogs, pet food industry, pomeranians, small dogs, urbanization
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11.14.2012 | Laotian Investing

Laos has a new stock market.

Launched during January 2011, on its opening day, the Laotian Securities Exchange listed 2 state-owned businesses, a bank and a power company. News reports indicated that investor interest in their securities was considerable and the IPOs (Initial Public Offerings, the process through which shares in privately held or state-owned firms are sold to the public) were oversubscribed. However, last April, average daily trading sunk to $941.

Actually, there are many new stock markets. Traditionally located in wealthy nations and British colonies, during the past 30 years, stock markets began popping up everywhere from Mongolia (1992) to Fiji(1980) to Iceland(1985) and Saudi Arabia(1984) and close to 50 other countries. During the 1990s, Eastern Europe was the place where many appeared.

Why?

This takes me back to 1792 and a button wood tree on Wall Street where traders used to gather each day to buy and sell securities. Whether in a developing nation 220 years ago or now, stock markets help growth because they pair businesses with investors.

Sources and Resources: Here, you can see the home page of the Laos Securities Exchange and their ticker tape (I think just 2 firms cycling) while The Guardian and WSJ had articles about its launch. For more current news about Laos’s World Trade Organization membership, this WTO announcement might be helpful. And finally, on the proliferation of stock markets in emerging economies, this research paper, “Policy as Myth and Ceremony? The Global Spread of Stock Markets,” was excellent.

Posted by: adminEcon
Tags: buttonwood tree, developing nations, emerging economies, foreign investors, Laos, Laotian Securities Exchange, NYSE, Southeast Asia, speculative investments, stock markets, Vietnam, World Trade Organization
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11.08.2012 | Beer Economics

In China, 1/2 liter of beer costs 9 minutes of work.

To calculate how many minutes of work it takes to buy beer in 150 countries, Swiss bank UBS researchers divided the median wage in that country by the price of 1/2 liter from a retailer. Their results? Beer drinking is most costly for workers in India (55 min.), Philippines (48 min.), Colombia (47 min.) and Nigeria (29 min.). At the other end of the list is the US (5 min.), Czech Republic (7 min.), Germany (8 min.), the Netherlands (9 min), and China (9 min.)

The UBS report reminded me that national beer consumption relates to affluence. According to the American Association of Wine Economists (yes, really) the connection between beer and per capita income is an upside down “U.” As individual incomes increase up to $22,000, so too does beer consumption. Then though, when wine and spirits become affordable, people move from beer to pricier liquor. Currently, nations with emerging markets represent two-thirds of the world’s beer consumption. (The ascent of China’s beer drinking curve in the graph below is striking.)

So, when anyone mentions beer, we can think about of purchasing power, economic growth and demand from the developing world.

A Final Fact: Beer has also been in the news as a source of government revenue. President Hollande just said France’s beer tax will rise by 160% to fund programs for young people and the elderly. Meanwhile, 2 years ago, after Russia spiked its beer tax by 200%, beer purchases declined.

Sources and Resources: This BBC article on the impact of the impending French beer tax was a good read as was the Economist’s details on the UBS beer cost study. More academic, the AAWE paper was the source of my beer drinking information about developing nations. Please note that all information from UBS and The Economist is current while data and the graph from the AAWE is from 2010 and before.

World Beer Consumption, 1961-2007

Posted by: adminEcon
Tags: American Association of Wine Economists, beer consumption, beer taxes, China, developing nations, economic growth, emerging markets, France, India, per capita income, purchasing power, Russia, The Economist, UBS, US
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06.10.2012 | What If More People Wore Eyeglasses?

We could say that eyeglasses are like bookends when they relate to economic growth.

Our story starts during the 13th century. Before the spread of eyeglasses, the work life of skilled craftsmen usually ended when they could no longer see close objects clearly–usually at 40 or so. Scribes, metalworkers, toolmakers, all could have worked another 20 years if they could just see better. According to economic historian David Landes, in Italy, when lens making became sufficiently proficient during the mid-15th century, the work life of craftsmen expanded and new techniques that required eyeglasses were invented.

Our story continues during 2004 with a free eyeglass program in rural northwestern China. When elementary school children whose families could not afford glasses got them for the first time, their grades improved. One third of the families in the study, though, refused the glasses.

This finally takes us to a story in The Economist about new eyeglass technology. Requiring no examination, people in developing nations will soon have access to $20 eyeglasses made with a silicone fluid that corrects the wearer’s vision with a self-adjusting lens.

And that returns us to eyeglasses and bookends. If more children in developing nations wear the new eyeglasses and more workers do also, at the beginning of one’s work life when human capital is developed and at the end when eyesight diminishes, eyeglasses will support economic growth.

I especially enjoyed reading about the invention and spread of eyeglasses and other early inventions that today we take for granted in The Wealth and Poverty of Nations (Chapter 4) and hearing about the free eyeglass program in this Freakonomics podcast. More academic but interesting, this article specifically presents the design and impact of the eyeglass study.

Posted by: adminEcon
Tags: China, developing nations, economic growth, eyeglasses, human capital, impaired vision, India, rural poverty
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