East Asian Experience Research Articles

Sources of state discipline: lessons from Israel’s developmental state, 1948–1973

AbstractBoth the classic literature on the developmental state and more recent accounts of rapid-innovation-based (RIB) development highlight the importance of the state's capacity to discipline underperforming firms. Although long acknowledged, the sources of this capacity remain relatively understudied, and existing knowledge draws almost exclusively on the East Asian experience. To address this lacuna, I examine the successful industrialization experience of Israel in the two and a half decades following its independence (1948–1973). Drawing on archival materials and other original sources, I identify a novel path to state discipline. Whereas East Asian developmental states became disciplinarian through their engagement with export competition, in Israel, state elites generated discipline by leveraging their embedded relations with collectively owned enterprises to foster a competitive domestic market. In the conclusion, I explore the relevance of this model for more contemporary cases of RIB development in both developed and late-developing economies.

Rethinking Land Reform in East Asia: Egalitarian or Inegalitarian?

:Taking a historical and comparative view, we explore the long debated cause of the spectacular economic successes of East Asia using land reforms in China and Japan during the 1940-50s. Examining the approach to land reform embodied by technocrats such as Liu Shaoqi in China and Wada Hiroo in Japan in addition to the implementation mechanisms of the policies they adopted, we show that the land reforms developed characteristics of dynamic factor endowment according to the Engerman-Sokoloff hypothesis. Fairly equal land redistribution led to political power equality and improved agricultural productivity and income equality, which is conducive to long-term economic development and the prevention of the Kuznets effect ex ante. Nevertheless, factors such as initial exogenous shocks, insufficient scale of family farming, persistent government support and consequential interest groups obstruct sustainable development of the agricultural sector as well as the generalization of East Asian experiences. Equality or inequality is essentially a policy choice in addition to being a long-term ex post evaluation of the reforms.

China’s Image from the Perspective of the Developmental State: What Kind of “Developmental State” is China?

The developmental state has become a popular definition used to discuss the “China Model”. Based on the developmental state, various definitions have originated. Concepts such as new developmental states and neo-developmentalism are widely applied to describe Chinese development. This paper summarizes representative opinions in examining China from the perspective of the developmental state, and reevaluates the specificity and characteristics of the Chinese developmental state in terms of structural dynamism. We believe that the developmental state as a concept is not precisely defined. Instead, its application and extension must incorporate considerations of historical specificity and subject continuity. Considering such initial constraints as politics, economics, and military conditions, China differs significantly from other classic examples of East Asian developmental states. Consequently, China would also face different developmental paths, directions, corresponding policies, and measures from those of other developmental states. The East Asian experiences of developmental states only offer limited scope for reference. Still, in terms of effective integration between markets, governments, and societies, their experiences and lessons prove worthy for consideration and reflection.

East Asia International Relations and International Relations Theory: Where Does a Poor Fit Exist, and What to Do about It

This article seeks to critically assess the relevance of International Relations Theory (IRT) for East Asia International Relations (IR). After identifying the shortcomings of IRT in explaining East Asia IR, the article provides several ways to modify it with a goal to make it more suitable for East Asia IR. Its central claim is that the IRT’s bias toward European experiences and great power politics generates unsatisfactory accounts for and inaccurate predictions about East Asia IR. This does not mean, however, that we should treat IRT as completely irrelevant and develop an indigenous theory of East Asia IR. Given that no single theory is complete and perfectly relevant across time and space and that many core concepts and key variables of IRT are also pertinent for East Asia IR, our efforts should instead be made to refine the existing IRT and make it more suitable for East Asia IR by problematising its major assumptions and central claims on the basis of East Asian experiences. This will save IRT from being a region-specific and a country-specific theory of IR.

Technology perspectives from 1950 to 2100 and policy implications for the global nuclear power industry

There have been two completed phases of developments in nuclear reactor technologies. The first phase is the demonstration of exploratory Generation I reactors. The second phase is the rapid scale-up of Generation II reactors in North America and Western Europe followed by East Asia. We are in the third phase, which is the construction of evolutionary Generation III/III+ reactors. Driven by the need for safer and more affordable nuclear reactors post-Fukushima, the nuclear industry has, in parallel, entered the fourth phase, which is the development of innovative Generation IV reactors. Through a comprehensive review of the historical reactor technology developments in major nuclear states, namely, USA, Russia, France, Japan, South Korea, and China, this study presents a projection on the future potentials of advanced reactor technologies, with particular focus on pressurized water reactors, high temperature reactors, and fast reactors, by 2100. The projected potentials provide alternative scenarios to develop insights that complement the established technology roadmaps. Findings suggest that there is no clear winner among these technologies, but fast reactors could demonstrate a new and important decision factor for emerging markets. Findings also suggest small modular reactors, especially those belonging to Generation IV, as a transitional technology for developing domestic market and indigenous technology competence for emerging nuclear states. With reference to the East Asian experience in developing nuclear competence, participation with international cooperation in the research and development of Generation IV and nuclear fusion reactor systems could demonstrate strategic entry points for countries with a long-term plan to derive indigenous nuclear reactor technologies.

Individualization in China under Compressed and Contradictory Modernity

Because of its unprecedented speed and scale, urbanization in China during the 1990s is one of the most representative fields in which to explore compressed modernity considering East Asian experiences. This article focuses on a collective litigation including 10,357 people suing the local government for the infringements on their property rights and citizenship during that period of urbanization. To make this massive movement possible under an authoritarian state, a new type of state-individual relationship was created, and a selection mechanism applied to the traditional, subordinate state-individual relationship and the modern, egalitarian state-individual relationship was constructed by the activists. The grassroots development of a strategic use of the law is the key to understanding how this selection mechanism was created. Activists distinguished multiple facets of “law”—literal law, symbolic law and practical law–to conceptualize the new egalitarian relationship through self-empowerment, in order to set the necessary preconditions for protesting, by segmenting the traditional state and to mobilize the network of participation by drawing upon the socialist memory of the “movement to popularize legal knowledge”. The selection mechanism described in this article could be considered as the response from individuals to the state during a time of transformation and shows the implication of temporality in the push and pull between individual rights and government overall control connected to the new and old systems. Tensions exist in this selection mechanism, and a paradox lies in the fact that the struggle for this egalitarian relationship should be based on the precondition that the subordinate relationship be internalized. By analyzing this complex process, this article points to China’s special social-historical process as it heads into modernity in an incremental and continuous way within such a short and compressed period of time, and also tackles the theoretical discussion of individualization from an East Asian perspective.

Massification of higher education and challenges for graduate employment and social mobility: East Asian experiences and sociological reflections

In the last few decades, we have witnessed a rapid expansion of higher education in Asia, resulting in the massification and marketization of higher education. Nonetheless, previous comparative research has indicated that the rapid expansion of higher education may not necessarily enhance upward social mobility but rather intensify inequality in education, especially when higher education is becoming increasingly privatized. This article critically examines how the massification of higher education has affected graduate employment and social mobility in East Asia. More specifically, this article uses sociological perspectives to discuss the major challenges resulting from the massification of higher education in East Asia, particularly reflects upon issues related to the mismatch between university education and the labour market, as well as stagnant social mobility.

The Chinese developmental state in transition: in light of the East Asian experiences

Current debates over China’s industrial policy are the responses to the growing concerns over China’s economic slowdown since late-2000s. After earlier efforts pursuing industrial upgrading, the country now starts to reassess its state-led development strategy. Going forward, the question arises: Why is it necessary to shift from state-led approach to market-enhancing strategy? Grounded on the similarities between the Chinese case and its East Asian neighbors, the paper first reviews the developmental experiences of those East Asian development states and then proposes a hypothesis that heavy state intervention works only for late-developers but less so for economically leading counties. The findings of the paper will not only just shed new light on the general associations between development stages and development strategies but also offer additional references for the countries bidding farewell to economic backwardness.

Developmental States and Sustainability Transitions: Prospects of a Just Transition in South Africa

Since the onset of the global economic crisis in 2007/2008 two key trends have made it necessary to reconceptualize the relationship between development and sustainability: the rapid rise of the so-called ‘BRICS’ and the emergence of the green economy discourse and now since 2015 the adoption of the Sustainable Development Goals. To address this challenge with respect to developing economies in the global South, this paper endeavours to fuse the core conceptual concerns of the developmental state and sustainability transition literatures. It is argued that a just transition would consist of a dual commitment to human well-being (with respect to income, education and health) and sustainability (with respect to decarbonization, resource efficiency and ecosystem restoration). However, to understand these processes we need a better understanding of political dynamics, and for this purpose the notion of a socio-political regime is introduced. A case study of South Africa's dual developmental and environmental trajectories is presented, revealing how different it is to the East Asian experience. Although a just transition in South Africa is currently unlikely, the rapid emergence of the renewable energy niche signals what may be possible if political and environmental shocks are experienced by key actors within the socio-political regime.

Reconsidering the Housing Asset-Based Welfare Approach: Reflection from East Asian Experiences

Housing is a platform of wealth accumulation in many home-owning societies. Ownership of assets often contributes to help people build social capital, influence their social participation and helps them access increasingly privatised goods and services. Such ‘asset-based welfare’ has been fashionable in Western academic circles, considering the ways in which housing could become a real or potential welfare resource. It may not, however, be such a novel idea from an East Asian perspective since the promotion of home ownership has always been embedded in the wider context of welfare provision in many parts of the region. Despite the argument that an increasing level of home ownership could potentially compensate for the erosion of family support, the sustainability of a home-ownership-based welfare approach has been questioned. At the forefront of ‘post-growth’ societies with societal ageing, recession, housing price volatility and neoliberal policy reforms, using Japan as a case study, this article examines the reasons and conditions behind the lack of success in commonly identified strategies of asset-based welfare in a regional context. The policy-driven market failures which supersede the cultural obstacles require re-examination.

Foreign Direct Investment and Technological Capabilities: The Relevance of the East Asian Experience for Pakistan

This paper makes the case for a vigorous policy thrust to support investment-led growth. Pakistan’s economy has not maintained a sufficient level of capital formation to sustain growth over the long term. Two thirds of current growth is driven by consumption and not investment: this needs to be turned around. The government needs to put in place an investment regime that motivates and induces industry to invest, innovate, and reinvest. Foreign direct investment can play an important role in strengthening the country’s investment rates. There is also need for deliberate polices to boost technological capabilities in the enterprise sector. In this context, East Asia – which successfully created a dynamic process of capital formation and technological learning that upgraded its productive capacity and underpinned export success – holds important lessons for Pakistan.

The New Developmentalism and the Challenges to Long-Term Stability in Brazil

A new developmentalism is said to have taken hold in Brazil over the past decade. Incorporating multiple policy strategies, it has three main pillars: promoting inclusive growth in the home economy, engaging the international economy to underpin national development and to sustain long-term growth, and pursuing internal and external objectives through the collaboration of a strong state and a strong market. In spite of several major accomplishments, this approach has disproportionately used industrial policy tools to privilege firms in traditional sectors and foster increased reliance on commodities, tendencies that have been enabled by bureaucratic incoherence and weak oversight of public financing. This makes it unlikely that deep productive transformation, a key developmentalist objective as defined by the East Asian experience, will materialize.Dizem que nesta última década, um novo desenvolvimentalismo tomou posse no Brasil. Incorpora muitas estratégias, as quais tem três suportes principais: a promoção dum crescimento globalmente compreensivo no mercado nacional, o aumento das relações com a economia internacional para apoiar o desenvolvimento interno e sustentar o crescimento a longo prazo, e a alcance de objetivos pela colaboração entre um Estado e um mercado fortes. A pesar de várias realizações importantes, este política há empregado, desproporcionalmente, instrumentos de política industrial no sentido de favorecer as empresas dos setores tradicionais e aumentar dependência nas materias primas: uma tendência possibilidada pela incoerência nos procedimentos burocráticos e pela fiscalização fraca dos gastos públicos. Por isso é pouco provável que se realizar qualquer transformação da produção, a que deve ser um objetivo chave desenvolvimentista segundo as padrões da experiências recentes da Ásia oriental.

Dynamics of structural transformation in South Asia

This paper contains an analysis of the pattern of growth and the structure of employment in various sectors of six South Asian economies (Bangladesh, Bhutan, India, Nepal, Pakistan and Sri Lanka); the trends in the technological capabilities of these countries are also examined, by characterizing the structure of their exports. It shows that although the level of sophistication is lower compared with East Asian economies, the distribution of exports in South Asian countries has shifted towards products that have a higher productivity index and are located “centrally” in product space, enabling production of several nearby goods. In terms of the summary measure of the proximity of the export basket to all currently unexploited products, highvalue ones in particular, the potential for future export sophistication is seen to be the highest for India among the South Asian countries and lowest for Bhutan followed by Bangladesh. Going by the East Asian experience, the South Asian governments have an important role to play in transforming their industrial structures.

Financial Integration and Financial Development in East Asia

This article analyzes differences in patterns of financial development across the major East Asian economies, particularly for the three largest economies of the region (China, Japan and South Korea), in the context of the possibilities for greater regional financial integration. It argues that these differences in patterns of financial development present an economic challenge to regional financial integration efforts, in addition to differences in levels of financial development and possible political barriers. The article reviews arguments for and against financial openness, the East Asian experience with financial integration, how economies in the region have responded to shocks and what they may do to continue to thrive in the future. It also discusses policy options for the future, including regulatory reform and coordination, and various possible risk management policies and institutions.

CHINA, INDIA, AND INDUSTRIAL POLICY FOR INCLUSIVE GROWTH

This paper discusses a possible case for industrial policy with special reference to the two emerging global giants, China and India. It begins with a clarification of the meaning of industrial policy, since not only does the term mean different things to different people, but the traditional and narrow definitions leads to significantly different conclusions than more recent, broader definitions. In the context of definition of the term, the paper also reviews the arguments for and against industrial policy, and discusses industrial policy in the context of globalization, including the evolution of multilateral trading rules. The main arguments of the paper discuss the Chinese and Indian economies, exploring in particular their past experience with variants of industrial policies. The similarities of the "China model" to past East Asian experience are explored, while the contrasts of India's development, and the distinction between liberalization and reform are examined. These two major country cases form the basis for a consolidation of recent conceptual ideas, where effective and successful industrial policy is viewed as part of a social contract, creating a pathway to inclusive growth.

Measuring the elements of knowledge regimes and their links to technological catch-up: a synthesis based on the East Asian experience

This paper provides a review of the roles of knowledge access and learning as determinants of technological catch-up and focuses on the relationship between the quantifiable measures of elements of the knowledge regimes of sectors and the possibility of catch-up. Catching-up implications of the various elements of knowledge regimes are discussed, after grouping them into two categories: those related to accessibility to the foreign knowledge base (degree of embodied technology transfer and modularity) and those related to the learning possibilities (tacitness of knowledge and cycle time of technologies). We find that catch-up possibilities are positively linked to the accessibility to foreign knowledge base, the degree of embodied technology transfer, and modularity and that a higher degree of knowledge tacitness tends to interfere with learning possibility while the impact of cycle time of technologies would be dubious depending upon the absorption capacity of the latecomers. It is also pointed out that the impact of the knowledge regimes would be different on different types of firms. Policy implications and remaining issues are discussed.

Financial Integration in East Asia: Past, Present and Possible Futures

This paper reviews the East Asian experience with financial integration, how economies in the region have responded to shocks, and what they may do to continue to thrive in the future. It discusses openness to capital flows as a key aspect of financial integration, briefly considering the theoretical underpinnings and empirical evidence for the benefits of openness. It then examines the East Asian experience with the two financial crises that have affected the region, and how the two episodes have differed. It concludes by considering policy options for the future, including regulatory reform and coordination, and various possible risk management policies and institutions. The analysis illustrates differences in patterns of financial development for the three largest economies of the region (China, Japan and South Korea) and discusses implications for financial integration efforts.

China, India and Industrial Policy for Inclusive Growth

This paper discusses a possible case for industrial policy, with special reference to the two emerging global giants, China and India. It begins with a clarification of the meaning of industrial policy, since not only does the term mean different things to different people, but the traditional and narrow definitions leads to significantly different conclusions than more recent, broader definitions. In the context of definition of the term, the paper also reviews the arguments for and against industrial policy, and discusses industrial policy in the context of globalization, including the evolution of multilateral trading rules. The main arguments of the paper discuss the Chinese and Indian economies, exploring in particular their past experience with variants of industrial policies. The similarities of the “China model” to past East Asian experience are explored, while the contrasts of India’s development, and the distinction between liberalization and reform are examined. These two major country cases form the basis for a consolidation of recent conceptual ideas, where effective and successful industrial policy is viewed as part of a social contract, creating a pathway to inclusive growth.

Good growth and governance in Africa: rethinking development strategies

PART I: INTRODUCTION AND OVERVIEW 1. Strategies for African Development PART II: GOVERNANCE, INSTITUTIONS AND THE STATE 2. Governance and Growth: History, Ideology and Methods of Proof 3. Institutional Monocroping and Monotasking in Africa 4. Governance and Growth Challenges for Africa 5. States and Markets: Neoliberal Limitations and the Case for a Developmental State 6. The African Economic Growth Record, and the Roles of Policy Syndromes and Governance PART III: TECHNOLOGY, INDUSTRIAL AND TRADE POLICIES 7. Dynamic Capacity Development: What Africa Can Learn from Industrial Policy Formulation in East Asia 8. How can Low-Income Countries Accelerate their Catch-up with High-Income Countries? The Case for Open-Economy Industrial Policy 9. Institutional Capacity and Policy Choices for Latecomer Technology Development 10. State-Business Relations, Investment Climate Reform and Economic Growth in Sub-Saharan Africa 11. Africa, Industrial Policy and Export Processing Zones: Lessons from Asia 12. South African Post-Apartheid Policies Towards Industrialization: Tentative Implications for Other African Countries 13. Issues in Africa's Industrial Policy Process 14. Tiger, Tiger Burning Bright? Industrial Policy Lessons from Ireland for Small African Economies PART IV: EMPLOYMENT AND HUMAN CAPITAL 15. Employment in Sub-Saharan Africa: Lessons to be Learnt from the East Asian Experience 16. Skills Development for Economic Growth in Sub-Saharan Africa: A Pragmatic Perspective PART V: INTERNATIONAL CONTEXT 17. Economic Liberalization and Constraints to Development in Sub-Saharan Africa 18. The Emerging Asian Giants and Economic Development in Africa

Testing Home Ownership as the Cornerstone of Welfare: Lessons from East Asia for the West

In recent years, one driver behind the promotion of home ownership in Western countries has been the belief that owner-occupied housing assets provide a means to build up individual welfare security, potentially offsetting pension shortfalls in retirement. In contrast, many developed East Asian societies have both long focussed on advancing ‘asset’ or ‘property-based welfare’ systems as well as experienced the late-1990s Asian Financial Crisis which forced changes in housing and welfare practices. This paper examines how home ownership and asset-based welfare fared in these contexts and the lessons to be learned. It begins by considering the role of owner-occupied housing assets in different welfare regimes before empirically examining how asset-based welfare systems have been realized. It then considers how East Asian home ownership and asset-based welfare systems have stood-up to economic crises. The final section considers what the East Asian experiences contribute to an understanding of the housing assets–welfare relationship.