The transition from relation-based to rule-based governance in East Asia

Abstract

PurposeThe purpose of this paper is to use the framework of rule-based and relation-based governance to examine the evolution of governance environment in the East Asian region including China, South Korea and Taiwan.Design/methodology/approachBoth qualitative and quantitative evidences are presented to demonstrate the paths these East Asian countries take in their transitions from relation-based governance to rule-based governance. Based on the framework, this analysis sheds light on the debate on whether East Asian economies will eventually move away from relation-based governance to rule-based societies.FindingsThe authors find that relation-based governance has helped East Asian countries achieve rapid economic growth in the early stages of their development. However, as the scale and scope of East Asian economies expand, continuing to rely on it may hinder their further development and therefore these countries should adopt a rule-based governance system in order to be efficient and competitive in the world market. While South Korea and Taiwan have made substantial progress in this transition, China has just embarked on the process.Originality/valueThis paper is among the first to systematically review the theories and evidence of the transition and the challenges East Asian countries face during the process.