How do you define emerging markets? What are some of the common characteristics?

Question

What will be an ideal response?

Answer 1

Emerging markets are those markets in a transition phase from developing to developed markets due to rapid growth and industrialization. Hence, markets which have (a)?started an economic reform process aimed at alleviating problems, for example, of poverty, poor infrastructure and overpopulation; (b)?achieved a steady growth in gross national product (GNP) per capita; (c) increased integration in the global economy; may truly be called emerging economies.

In defining emerging markets, large populations, rapid growth in GDP as well as increased contribution to world trade can be identified. Increased contribution to the world economy can be observed in increased exports, imports, inward and outward foreign investments. Such markets are often associated by rapidly growing populations and younger populations.

Such markets are also identified by progressive economic reforms and expectations of accelerated economic expansion. High growth rates and industrialization also lead to urbanization in such markets. In parallel, income levels are often increasing rapidly.

Even though emerging markets are very different from each other in terms of culture, political and economic characteristics, market structures and demographic structures, some general trends can be identified in order to understand the rise of such markets, as well as opportunities and challenges presented by these markets.