Gunnar Myrdal published his magnum opus, Asian Drama: An Inquiry into the Poverty of Nations, in 1968. He was deeply pessimistic about development prospects in Asia. The fifty years since then have witnessed a remarkable social and economic transformation in Asia - even if it has been uneven across countries and unequal between people - that would have been difficult to imagine, let alone predict at the time. Asian Transformations: An Inquiry into the Development of Nations analyses the fascinating story of economic development in Asia spanning half a century.
Asian Transformations sets the stage by discussing the contribution of Gunnar Myrdal to the debate on development then and now and providing a long-term historical perspective on Asia in the world. It then uses cross-country thematic studies on governments, economic openness, agricultural transformation, industrialization, macroeconomics, poverty and inequality, education and health, employment and unemployment, institutions, and nationalisms to analyse processes of change while recognizing the diversity in paths and outcomes. Specific country studies on China, India, Indonesia and Vietnam, and sub-region studies on East Asia, Southeast Asia, and South Asia, further highlight turning points in economic performance and demonstrate factors underlying success or failure.
Including in-depth studies by eminent economists and social scientists, Asian Transformations comprehensively examines the phenomenal changes that are transforming economies in Asia and shifting the balance of economic power in the world and reflects on the future prospects for this continent over the next twenty-five years. It is a cohesive and multi-disciplinary study of a rapidly changing economic landscape, and makes an important contribution to understanding the complexities and processes of development from different perspectives.
Author(s): Deepak Nayyar (eds.)
Series: WIDER Studies in Development Economics
Edition: 1st
Publisher: Oxford University Press
Year: 2019
Language: English
Pages: 602
City: Oxford
Cover......Page 1
Asian Transformations: An Inquiry into the Development of Nations......Page 4
Copyright......Page 5
Foreword......Page 6
Preface......Page 8
Table of Contents......Page 12
List of Figures......Page 14
List of Tables......Page 16
List of Abbreviations......Page 18
Notes on Contributors......Page 22
PART I: SETTING THE STAGE......Page 26
2. Gunnar Myrdal and Asian Drama......Page 28
3. Rationale and Objective......Page 32
4.1 Diversity in Development......Page 37
4.2 History, Context, and Conjuncture......Page 38
4.4 Well-being of People......Page 39
4.5 States, Markets, and Governments......Page 40
4.6 Economic Openness......Page 42
4.7 Institutions and Policies......Page 43
5. Structure and Contents......Page 45
Acknowledgement......Page 51
References......Page 52
1. Introduction......Page 54
2. Gunnar Myrdal Before Asian Drama......Page 55
3. The Development Terrain in Mid-twentieth Century......Page 60
4. Asian Drama and After......Page 66
5. Conclusion: Asian Drama and the Development Discourse in the Twenty-first Century......Page 72
References......Page 74
1. Introduction......Page 77
2. The Main Elements of Myrdal’s Methodological Approach......Page 78
2.2 The Political Element......Page 79
2.3.1 Choice of Values......Page 80
2.4 The Social System and its Five Major Categories......Page 81
2.6 The Inappropriateness of Western Economic Concepts......Page 83
3.1 Political Motivation and Ideology......Page 84
3.2 The Selection of Values......Page 86
3.3 The Nature of Development......Page 88
3.4 The Five Elements of the Social System......Page 89
3.5 Multi- and Interdisciplinarity......Page 91
3.6 The Inapplicability of Western Economic Concepts......Page 92
4.1 The Acceptance of Myrdal’s Ideas......Page 94
4.3 Moving On . . .......Page 95
4.3.3 Recognition of the Contribution of Local Social Scientists......Page 96
4.3.4 The Inappropriateness of ‘Western’ Economic Concepts to the West Itself......Page 97
5. Conclusion......Page 98
References......Page 99
1. Introduction......Page 105
2. Malthus, Muslims, and Mongols, 1000–1500......Page 106
3. Silk Roads and Sea Lanes: International Trade, 1000–1500......Page 110
4. The European Intrusion and the Creation of Global Trade, 1500–1650......Page 113
5. Land Power versus Sea Power, 1650–1860......Page 116
6. Imperialism to Independence, 1860–1968......Page 120
7. Will this be the Asian Century?......Page 123
References......Page 127
PART II: CROSS-COUNTRY THEMATIC STUDIES......Page 132
1. Introduction......Page 134
2. The Northeast Asian Developmental State: Origins and Transformation......Page 135
3. China: A Theoretical Challenge to the Analysis of the Asian State......Page 138
4. Southeast Asian Counterpoints......Page 142
5. The Contradictory Configuration of the Indian State......Page 145
6. What Lessons from the Transformations of the Asian State?......Page 153
References......Page 156
1. Introduction: Economic Openness and Asian Divergence......Page 161
2. The Abiding Legacy of Myrdal’s Asian Drama......Page 162
3. Trade and Investment Patterns in the Asian Divergence......Page 166
3.1 Trade and Technology Flows in the Era of Hyperglobalization......Page 170
3.2 Foreign and Domestic Resource Mobilization......Page 175
4. Concluding Remarks......Page 179
References......Page 181
1. Introduction......Page 185
2.1 Agricultural Exit and Structural Change......Page 186
3. Agriculture and Food System Changes as Conditioners of Inclusive and Exclusive Structural Transformation......Page 189
3.1 Shifting Demographics, Shifting Diets......Page 190
3.2 Agricultural Technology Change and Farm Size......Page 193
3.3 Labour Markets and Rural and Agri-Food System Transformations......Page 198
4. The Role of Policies......Page 200
5. The End of the ‘Asian Drama’?......Page 205
References......Page 207
1. Introduction......Page 211
2.1 The Extent of Industrialization in Developing Asia......Page 212
2.2 The Trajectory of Industrialization Among the Asian Economies......Page 216
2.3 Upgrading and Diversification of Industrial Production......Page 220
3.1 The Purpose of Industrial Policy in the Framework of Circular and Cumulative Causation......Page 226
3.2.1 Republic of Korea......Page 227
3.2.2 Malaysia......Page 228
3.2.3 China......Page 229
3.2.4 India......Page 231
3.3.1 The Choice of Policies......Page 232
3.3.2 Pragmatism and Adaptability......Page 233
3.3.3 Enabling Conditions......Page 235
4. Conclusion......Page 236
References......Page 237
1. Introduction......Page 241
2. Initial Conditions......Page 243
3. Labour Utilization and Extensive Growth......Page 246
4. Macroeconomic Constraints on Labour Use......Page 248
5. Domestic versus Foreign Markets......Page 249
6. Import Substitution versus Export Promotion......Page 251
7. Technological Capability and Capital Account Openness......Page 253
8. The Role of Decentralization in the State versus Market Debate......Page 256
9. Economic and Social Inequality......Page 258
10. Concluding Observations......Page 260
References......Page 262
1. Introduction......Page 265
2.1 Growth Profile......Page 267
2.2 Inequality Profile......Page 268
2.3 Poverty Profile......Page 272
3. Sources of Poverty Reduction......Page 273
4.1 Drivers of Inequality......Page 280
4.2 Costs of Inequality......Page 283
5. Summary and Conclusions......Page 284
References......Page 289
1. Introduction......Page 292
2.1 The Observed Trends Across Countries......Page 294
2.2 Key Experiences of Selected Countries......Page 300
2.2.3 The Largest Countries: China, India, and Indonesia......Page 301
2.3 The Spread of Education: Stylized Facts and Major Challenges......Page 302
3.1 The Observed Trends Across Countries......Page 303
3.2.1 The Best Performers: Singapore, Korea, and Thailand......Page 307
3.2.3 The Largest Countries: China, India, and Indonesia......Page 308
3.3 The Development of Healthcare: Challenges and Responses......Page 310
4. Social Development, Disparity, and the State......Page 311
Acknowledgements......Page 318
References......Page 319
2.1 Concepts of Employment and Labour Markets at the Time of Asian Drama......Page 322
2.2 Evolution of Thinking on Labour Markets and Employment......Page 324
2.3 Analytical Approach......Page 325
3.1 Asian Regions Compared with other Developing Regions......Page 326
3.2.1 Growth Regimes......Page 328
3.2.2 Labour Market Regimes......Page 330
3.2.4 Female Employment and Labour Force Participation......Page 332
4. Policies, Institutions, and Outcomes......Page 333
5. Future Prospects......Page 337
5.2 Migration......Page 338
5.3 Technology, Industrialization, and Labour Replacement......Page 339
5.5 Social Development, Education, and Health......Page 340
5.6 Income and Wealth Inequalities......Page 341
References......Page 342
1. Introduction......Page 346
2. Myrdal and Institutional Analysis......Page 348
3. Political Settlements and Institutional Evolution......Page 352
4. Comparative Institutional Experiences......Page 358
5. Incremental versus Radical Reform and Prospects for the Future......Page 365
References......Page 367
1. Introduction......Page 371
2. The Legacy of European Nationalism......Page 372
3. Post-war Asian Nationalisms......Page 375
4. Colonial Legacies in Asia......Page 376
5. The Cold War Framework......Page 379
6. Nationalism in China and India......Page 383
7. The Asian Financial Crisis and the Question of National Autonomy......Page 388
8. Nationalism and Development in the Twenty-first Century......Page 390
9. Conclusion......Page 392
References......Page 394
PART III: COUNTRY AND SUB-REGION STUDIES......Page 398
COUNTRY STUDIES......Page 400
1. Introduction......Page 402
2. Why was China Trapped in Poverty before 1978?......Page 405
3. Why could China have an Extraordinary Performanceafter the Transition in 1978?......Page 408
4. Why did other Transition Economies not Perform Equally Well?......Page 411
5. What Price did China Pay for its Success?......Page 414
6. Can China Maintain Dynamic Growth and become a High-Income Country in the Years Ahead?......Page 416
7. Final Remarks......Page 419
References......Page 423
1. Myrdal and India......Page 426
2. Politics First......Page 427
3. India’s Economic Trajectory Since Independence......Page 432
4. Contemporary Challenges......Page 438
4.1 Bureaucratic Costs......Page 439
4.2 Corruption Control......Page 440
4.3 Norms and Institutions......Page 442
4.4 Technology and Labour......Page 443
5. The Next Twenty-five Years......Page 444
Acknowledgements......Page 445
References......Page 446
1. Introduction......Page 449
2.1 The Dynamics of Structural Transformation......Page 450
2.2 Initial Conditions: Where does the Path Begin?......Page 452
3. The Evolution of the Indonesian Economy......Page 453
3.2 Pro-poor Growth in Historical Perspective......Page 454
3.3 The ‘New Order’ Government of Suharto: Why was Growth so ‘Pro-poor’?......Page 457
3.4 The ‘Democratic Era’ (1999–)......Page 461
4. Political Economy and Governance......Page 463
4.1 The Political Economy of Pro-poor Growth......Page 464
4.2 Trends in Governance at the National Level......Page 468
5. Looking Forward to 2045: Optimism or Pessimism?......Page 469
Acknowledgements......Page 471
References......Page 472
1. Introduction......Page 475
2.1 Pre-reunification......Page 476
2.2 Post-reunification, 1976–1985......Page 477
3. Economic Growth, Structural Transformation, and Rural Change from 1986......Page 479
4. From Planning to Markets: Increasing SOE Autonomy and Fostering Entrepreneurship......Page 481
5. Openness: Aid, Trade, and FDI......Page 483
6. Human Development......Page 487
7. Conclusions and Reflections......Page 488
References......Page 493
SUB-REGION STUDIES......Page 500
1. Introduction......Page 502
2. Exceptional Economic Performance in Northeast Asia......Page 503
3. Northeast Asia’s Rise in the Neo-liberal Paradigm......Page 504
4. The Rise of the Developmental State......Page 505
4.1 The ‘Luck’ of Location, Endowments, and Timing......Page 506
4.2 The US Role in Northeast and Southeast Asia......Page 510
5. Characteristics of the Northeast Asian Developmental State......Page 514
5.1 The Developmental Mindset......Page 515
5.2 State Capacity and Bureaucracy–Business Institutions......Page 517
5.3 The Policy Level......Page 518
6. Singapore and Hong Kong......Page 521
7. Conclusion......Page 522
References......Page 526
1. Introduction......Page 529
2.1 Institutional Reforms......Page 531
2.1.2 The Market Economy Three......Page 532
2.2.2 Impact on Society......Page 533
3. Industrial Development, the State, and the Private Sector......Page 534
3.1.1 Developing while Import-Substituting......Page 536
3.1.2 Contrasting Approaches to External Liberalization......Page 537
3.3.1 Relational Contracting......Page 538
3.3.2 Business Dominance by a Minority of a Minority......Page 539
4. Openness, Trade, and Foreign Investments......Page 540
4.1 Performance and Diversification in External Trade......Page 541
4.2 Policies towards Foreign Investment......Page 542
4.3 Balance-of-Payments Financing and the Asian Financial Crisis of 1997–1998......Page 543
5. Employment, Inequality, and Social Development......Page 544
5.1 Employment Absorption and Poverty Reduction......Page 545
5.2 Social and Political (In)equity......Page 546
5.3.1 Health: Limited Progress towards Universal Coverage......Page 547
6. Southeast Asian Development Narratives......Page 548
References......Page 551
1. Introduction......Page 556
2. Historical Context and Initial Conditions......Page 557
3. Growth and Structural Transformation......Page 560
4. Growth Reversal of the 1970s......Page 563
5. Attempted Transition to a Higher Growth Path......Page 565
5.1 The Reform Process......Page 566
5.2 Post-reform Growth Trajectories......Page 567
5.3 The Story of Bhutan......Page 570
6. Poverty Reduction and Human Development......Page 571
7. Challenges Lying Ahead......Page 575
References......Page 578
Index......Page 582
