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The example of the so-called Japanese miracle was of vital importance to Pacific Asia, not only for the wealth it brought to the region (and a new economic resentment evoking wartime memories), but for the creation of a new Asian approach to capitalism. Borrowing technology and some social institutions from the West, and taking a kick-start from the American Occupation, Japan rose from desperate poverty to incredible affluence in 25 years. It was an example which other Asiancountries—most notably Korea and the Newly Industrializing Economies (NIEs)–used in their attempts to duplicate Japan's spectacular success.
The ingredients of these economic miracles have been much discussed in pop-business primers and academic texts. The intent of this unit is not to dwell upon the business prowess of Asian entrepreneurs, but to focus on the emergence of a new socio-economic model in Asia which some argue has been significantly aided by cultural and historical factors. If Japan's economic miracle has become the new exemplar, its modified blueprints are spreading to other parts of Pacific Asia. The parallel rise of the Republic of Korea as one of the world's biggest manufacturers and exporters is the prime example. Modeled closely on Japan's successes (just as Japan used American models), Korea built up its industry seemingly overnight. Korean growth figures are the most spectacular in the world. Will Korean conglomerates like Hyundai overtake their Japanese competitors in some sectors? The possibility cannot be ruled out. Working from the same set of national incentives as the Japanese, Koreans made their country a graphic example of NIEdevelopment.
The video segment includes a look at Taiwan as a possible example of "Confucian Capitalism," and raises the general question as to the economic role of Confucian traditions in this and other parts of Asia. In fact, "Confucianism" is a modern concept for which there was no exact equivalent in pre-modern Asia. Even the name "Confucius" is a Latinized version of one of the founders of the tradition, Kong Fuzi. Its ideas and practices evolved differently as it spread through other East Asian societies; its usefulness as either as a secular philosophy or a political ideology to explain economic success and failure is clearly limited. The video includes interviews with some authorities who suggest that the pervasive influence in certain countries of Confucianprinciples (emphasis on education and familial ties; guidelines for proper and ethical behavior among individuals, placing them in hierarchical relationships; and stressing social harmony) have reinforced national efforts toward economic development.
It is wothwhile to consider the role of Confucian traditions in influencing the degree to which countries like Singapore prefer a relatively authoritarian single-party system. While the extent of Confucian influence is impossible to measure, there are intriguing indications of its impact in the evolution of family-based business into corporate empires in Japan, Korea, Taiwan and elsewhere. The effort in China to revive Confucian ideals, after their decline and temporary suppression earlier, exemplifies how some Asians themselves seem to accept a vague connection between a Confucian environment and the "economic miracles" in Hong Kong, Singapore and enclaves of the ethnic Chinese throughout the Pacific world. We hear counter-arguments from experts such as Chalmers Johnson, who stress that economic success has grown primarily from skilled bureaucracies which have used business-government relationships in creative ways that make them powerful competitors in the international arena. The question is left for the viewer to judge, albeit with a clearer understanding of its complexity.
Video: "Big Business and the Ghost of Confucius"
After viewing the video and reading Chapter 7, you should have a basic understanding of the following concepts.
1. The aggregate economic growth of Asian-Pacific countries in the past four decades is unsurpassed by any other world region.
2. By developing a strong export-market orientation, Japan and the NIEs have successfully utilized growing global economic interdependence.
3. The stress on economic development as a primary national goal has been a major factor in postwar Asian-Pacific successes.
4. Political stability and centrist or conservative domestic orientations seem to have been necessary prerequisites for Asian-Pacific high-growth economies.
5. Historical processes and traditional cultures have helped to shape the postwar political economies of the Asian-Pacific countries, both capitalist and socialist.
6. The distribution of economic achievement in the NIEs differs according to resource endowment, trade orientation, and political ideology.
7. Confucianist traditions appear to have exerted a positive influence on economic development in Pacific Asia in spite of the fact that Confucianism was also used to rationalize resistance to modernization, particularly in the nineteenth century. Then, as now, Confucianism can be interpreted by governments in ways that support their national political goals.
KEY TERMS AND NAMES
QUESTIONS FOR REVIEW
1. Describe the pattern of policy choices made by the each Asian capitalist economy.
2. What are the key elements of the Asian model of economic development? What factors are the same as those in the West? What factors are different?
3. What is import substitution? How has it been used in Pacific Asia?
4. What is the importance of ASEAN? What kind of an organization is it? What binds the countries together? What economic factorsseparate them in spite of their unity in ASEAN?
5. How are the "ASEAN-4" different from the other ASEAN states? How is Indonesia different from other ASEAN states?
6. Which countries have been classified as NIEs? What characterizes their development? What are their differences? Their similarities?
7. Why were the NIEs placed in a different economic category from Japan? To what extent is the difference significant today? Compare and contrast the so-called NIEs and Japan.
8. How, and to what extent, do the NIEs, ASEAN, and Japan depend on the global economy?
9. What is the significance of the US to the South Korean economy? How did international developments affect the ROK?
10. What is the relationship between natural resources and primary product economies? Compare resource-rich areas with Hong Kong and Singapore. What accounts for the difference in growth between Hong Kong and Singapore versus countries rich in natural resources?
The New Asian Capitalists
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