Developing countries are growing faster than mature ones, causing Western nations to reexamine their economic growth
As nations continue to emerge from global recession, developing economies have grown more rapidly than the mature economies of Europe and the United States.
This “two-speed” recovery is expected to even somewhat in 2011, but economists say mature economies must develop innovative business models to maintain robust growth.
A mature country is one with a stable or declining population, and slowing economic growth. A decline in consumer demand, job creation and productivity can all occur in a maturing economy. Growth in such an environment requires innovative business models that address the unique features of mature economies, said Jean Berg, vice president of Estin & Co., an international consulting firm.
“Consumer needs in mature economies are evolving towards greater segmentation, in terns of price, nature of product within a given category, origin of product, and other factors,” Berg said. “To capture hidden growth, a business model must be developed that fully responds to niche demand in an economically feasible manner.”
Mature economies test the feasibility of economic models based entirely on growth,
said John Beck, a senior research fellow at the University of Southern California’s Annenberg Center for the Digital Future, who argues that growth may not be the only path to prosperity.
“Small nations like Bhutan and Costa Rica have already managed to shift their emphasis from economic growth to measures of overall well-being,” Beck said.