Prepared By Prof Alvin So1 SOSC 188 Lecture 10 The New Dependency (II): The Case of Taiwan

Prepared By Prof Alvin So2 Colonial Dependency ( ) Bureaucratic-Authoritarian State (the 1950s-1970s)

Prepared By Prof Alvin So3 Colonial Dependency ( ) Classical colonial dependency - Japanese colonial government monopoly, extraction of raw materials, suppression of local culture and identity Colonial development- infrastructure building, agricultural associations to promote rural development industrialization in the 1930s

Prepared By Prof Alvin So4 Bureaucratic-Authoritarian State (the 1950s-1970s) The KMT state arrived from mainland China in outsiders with little local linkages militaristic, unchallenged political leadership, authoritarianism: martial law, no human rights, no labor protests Agricultural policies in the early 1950s - land reforms, high productivity, state extraction through taxes and fertilizer, stabilization through price controls and credits

Prepared By Prof Alvin So5 Industrial policies in the late 1950s - import substitution, protecting domestic industries through tariff large state sector: state enterprises of bank heavy industries Industrial policies since the 1960s - export-led industrialization: state provided incentives for exports state set up favorable investment climate: public education, low wages, infrastructure, tax incentives, set up special economic zones (SEZs) state planning: gradually upgrade light industries in the 1960s to heavy industries in the 1970s/1980s

Prepared By Prof Alvin So6 Why did the Tai wan state make the critical shift from import substitution to export industrialization in the 1960s? American pressure: Cutting off US aids if no export industrialization State had the capacity to provide incentives: Generous US aids prevent Taiwan from falling from falling into debts Favorable export environment: Expanding US market & global economic boom