Chapter 7 ECON 5430-001 Li minqi Group members:  Zeng Qi                                     Zou jianlang                    

Chapter 7 Japan South Korea Taiwan Singapore Hong Kong South-east Asia China

Outline The East Asian State and Production Picking the Winners Foreign Direct Investment Policies East Asian Companies Domestic Political Economy of Production Conclusion

Picking the Winners Japan: is the first East Asian nation to adopt industrial policy and set a successful example for others South Korea: take industrial policy to another level (early 1960s) Taiwan: encouraged industrial upgrading to heavy industries Singaporean

Picking the Winners Hong Kong: limited intervention in the economy while adopting measures to keep production cost low. Malaysian: emphasized manufacturing Thai: not engaged in industrial policy as actively as Northeast Asian countries Chinese: in 1950s-----promoted heavy industrialization

Foreign Direct Investment Policies Inward investment Japan & South Korea------largely discouraged FDI Other East Asian economies welcome foreign investment China enacted a joint venture law in 1979 provided major incentive for foreign investors since the 1980 Vietnamese: actively seeks FDI-----following the Chinese and ASEN models

East Asian Companies East Asian companies are the engines of East Asian economic growth and economic transformation (become more prominent globally) Japan-----led the way Brand name: Sony, Toshiba, Toyota, Honda, Nissan…

East Asian Companies South Korean: followed Japan’s example Brand name: Samsung, LG, SK… Large chaebol have powered South Korean economic growth

East Asian Companies Rank

Domestic Political Economy of Production Why production has been so important for East Asian? Strong economic base for national power The employment that manufacturing provides

Conclusion Two extreme The South Korean state has been the most detail-oriented interventionist (learning from Japan and moving to another level) The Hong Kong-----basically adopted a free-market approach

Conclusion East Asian advantages: production, proximity and skill

Thanks!