the logic of developmental state

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Review: The Logic of the Developmental State

Author(s): Ziya niSource: Comparative Politics, Vol. 24, No. 1 (Oct., 1991), pp. 109-126Published by: Ph.D. Program in Political Science of the City University of New YorkStable URL: http://www.jstor.org/stable/422204Accessed: 26/08/2010 21:22

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Review ArticleThe Logic of the Developmental State

Ziya Oni?

Alice H. Amsden, Asia's Next Giant: SouthKorea and Late Industrialization,New York,OxfordUniversityPress, 1989.Frederic C. Deyo, ed., The Political Economy of the New Asian Industrialism,Ithaca,CornellUniversityPress, 1987.ChalmersJohnson,MITIand the Japanese Miracle, Stanford,StanfordUniversityPress,1982.RobertWade, Governing he Market:EconomicTheoryand the Role of Governmentn EastAsian Industrialization,Princeton,PrincetonUniversityPress, 1990.

Development theoryand policy duringthe last decade have been thoroughlydominatedbythe neoclassicalparadigmand the neoliberaleconomic measuresclosely identified with thisparadigm. Structuralist evelopment heoryhad been the prevailingorthodoxy duringthe1950s and early 1960s. A central idea associated with structuralismwas the belief thatmarket ailure is a pervasivefeatureof the underdeveloped conomy with the corollarythatthe state has an important ole to play in correcting t. The neoclassical resurgence,whichcan be tracedback to the late 1960s andearly 1970s, attacked tructuralism n threeseparategrounds.First, extensive state intervention o promote import-substitutingndustrializationhadgenerated nefficientindustries,requiringpermanent ubsidization ortheir survivalwithlittle prospect of achieving internationalcompetitiveness. Second, extensive governmentintervention ended to generate rentseeking on a substantialscale, which detracted heattention of economic agents from productive activities into lobbying for increasedallocations of government subsidies and protection. Third, and most significant in thepresentcontext, empiricalevidence on the experienceof the most successful countries toemergefrom the ThirdWorld, namelythe four East Asian countries,Taiwan,SouthKorea,Hong Kong, and Singapore, showed that these countries achieved extraordinary ates ofeconomic growth, which moreover had been consistent with a relatively egalitariandistributionof income. The unique performanceof these economies hadbeen generatedbyusing an outward-orientedmodel drivenby market ncentives and a strong privatesector.'What we are now witnessing is the emergence of a countercritique f the neoclassical

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paradigmbased on a reinterpretationf the East Asian developmentexperience. The fourbooks underreview in this essay are outstandingexamples of a growing literaturewhichseeks to refute the neoliberalvision of East Asian growthin terms of the economic benefitsof trade liberalization,private enterprise,and a restricted role for the state.2 The centralthesis associated with the newly emerging countercritique,which we might classify asbroadly institutionalist, is that the phenomenon of late development should beunderstoodas a process in which states have played a strategicrole in tamingdomestic andinternationalmarket orces andharnessing hemto nationalends. Fundamental o East Asiandevelopmenthas been the focus on industrialization s opposedto considerations nvolvingmaximizing profitabilityon the basis of currentcomparativeadvantage. In other words,marketrationalityhas been constrainedby the prioritiesof industrialization.Key to rapidindustrialization s a strong and autonomous state, providing directional thrust to theoperationof the market mechanism.The market is guided by a conception of long-termnationalrationalityof investmentformulatedby governmentofficials. It is the synergybetween the state and the marketwhich provides the basis for outstandingdevelopmentexperience.The institutionalist perspective attempts to transcend the structuralistdevelopmenteconomics which downplayed the key role of markets in the industrializationprocess.Similarly, it attemptsto transcend the subsequentneoclassical resurgencewhich rapidlymoved to theoppositeextreme andinterpreted ll successful industrializationpisodes as theoutcomeof free markets,with the necessarycorollarythatthe domain of state interventionin the economy had to be restrictedas far as possible. The broad institutionalistperspectiveelaborated,albeit with somewhatdifferentemphases, in the four studies underconsiderationaims to move beyond what appearsto be an increasinglysterile neoclassical-structuralistcontroversy in a number of fundamentalrespects. At a very crude level, to proposemarket-orientedand state-led development as alternatives is simply ahistorical andmisleading. All successful cases of late industrialization have been associated with asignificant degree of state intervention.The problem, therefore, is to find the appropriatemixture of market orientation and government intervention consistent with rapid andefficient industrialization.Equally central is the issue of which set of institutional andpolitical arrangements s compatible with the appropriatemix of state intervention andmarket orientation in the economy. Hence what we observe in the context of theinstitutionalist countercritique is a fundamental shift of the problem from thestate-versus-marketdichotomy towards differences in the ways that market-orientedorcapitalist economies are organized and towards how these organizational differencescontributeto the contrasts in both policies implemented and the subsequenteconomicperformance.3In the presentessay, the focal pointof our interest s on the institutionalandsociopoliticalbases underlying he capacityof the East Asian states to implementeffective and coherentdevelopmentstrategies.In particular,we identifyand synthesizethe contributionsmadebythe four volumes in the following set of issues. Is therea prototype development tate, orare therefundamentallydifferentvariantsof the developmental tate, even in the East Asiancontext?Is the East Asian developmentalstate a productof specific cultural and historicalcircumstances? Does the developmental state require a particular regime type? Is thedevelopmentalstatefundamentally ncompatiblewith pluralistic orms of democracy?What110


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international ompetition n foreignmarkets,thoughnot in domestic markets.These are theproximatecauses. At a more fundamentalevel, theseoutcomes themselves arethecauses ofa specific set of policies which enable the government o guide or govern the processof resourceallocation so as to producea differentproductionand investmentprofile thanwould result undera free marketsystem. The set of incentives, controls,and mechanisms ospreadrisk, which may all be gatheredunderthe bannerof strategic ndustrialpolicy, are inturnsupportedby specific political, institutional,andorganizational rrangements ertainingto both the state apparatus ndprivatebusinessas well as their mutual interaction.Amsden's account of South Korea provides an outstanding illustration of thedevelopmentalstate in action. The picturewhich emerges from Amsden's analysis of theKorean case contains a number of strong parallels with Johnson's account of MITI andJapaneseindustrialpolicy and to a lesser extent with Wade's account of the Taiwaneseexperience.The essence of Amsden'sargumentmaybe elaboratedas follows: Koreamaybecharacterizedas a prototypecase of a guided marketeconomy in which marketrationalityhas been constrainedby the prioritiesof industrialization.The governmenthas performedastrategicrole in tamingdomestic and internationalorces and harnessingthem to nationaleconomic interests.Rapid industrialization er se has been the overridingconsideration,asopposedto maximizingprofitabilityon the basis of current omparativeadvantage.The statehas heavily subsidizedanddirecteda selected groupof industriesand subsequentlyexposedthemto international ompetition.What is interesting,however, is that the industriesapartfrom the priority sectors experienced policy interventiononly intermittently,while theremaining ndustrieshave been exposed unaidedto the rigorsof marketcompetition.Hencea high degree of selectivity has been the centerpieceof industrialpolicy. The state hasretainedsufficient instrumentsof control so that, whatever happenedin the rest of theeconomy, sufficient investment would be forthcomingin the strategicsectors. Thus, themarketwas guidedby a conceptionof the longer-termrationalityof investmentformulatedby the stateelites. Furthermore,he state has provideda stableandpredictable nvironmentwithin which the corporationscould undertake ong-termrisks. The basic criteria for thechoice of strategic ndustries nvolvedhigh incomes elasticities of demand n world marketsplus the potentialfor rapidtechnologicalprogressand laborproductivitygrowth.State intervention nvolved the creationof pricedistortionsso that economic activitywasdirected towardsgreater nvestment.Hence, in strikingcontrast o the logic of neoclassicaldevelopment theory, a high degree of government interventionhas occurred to distortrelative prices so that the desired levels of investment could materializein the strategicsectors. Yet the discipline imposed by the governmenton business behaviorconstitutedacrucial component of the industrial strategy. The government has specified stringentperformancerequirements n returnfor the subsidies it has provided. As a result of thediscipline exercised over the performanceof firms located in strategic sectors, pricedistortionssuch as heavily subsidized rates of intereston long-termcredits did not lead to awaste of resources as in the case of manyother middleincome economies. The disciplineexercised over privatefirms involved both rewardinggood ones as well as penalizingpoorperformers.The governmenthas deliberatelyrefrained rom bailing out firms which werebadlymanaged n otherwiseprofitable ndustries.Hence the way in which industrialpolicyhas been implementeddiffereddecisively from the negative forms of industrialpolicy that112


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Ziya Oni4are characteristic of a number of West European countries, which have involvedsubsidizationof decliningfirms or industriesexperiencing inancial difficulties.

The disciplineexercisedover privatebusinesshasassumeda multitudeof forms.Throughits industrialicensing policies the statehas managed o limitthe numberof firmsallowedtoenteran industry.The policy has facilitatedthe realizationof economies of scale but at thesame time encouraged ntensecompetition or marketsharesamongthe existingfirms in theindustry.Hence the mixtureof competitionand cooperationwas central to the success ofindustrial policy. The state has deliberately accelerated the process of industrialconcentrationas a basis for successful competition in internationalmarkets. It is clear,therefore,thatEast Asian style industrialpolicy does not make sense withoutthe associatedEast Asian style competitionpolicy. The largediversified businessgroups,Chaebols,havedeveloped under direct state influence and guidance. Nonetheless, the state has attemptedexplicitly to preventthe abuse of monopoly power by imposing stringentprice controls,negotiatedon an annualbasis. Furthermore, xtensive restrictionshave been placed on thecapitalaccount. Investorshave been subjected o controlson capital flight andremittanceofliquid capital overseas. Regulationof the financial system representeda centralpillar ofKorea's industrialpolicy. Until very recently all commercial banks were owned andcontrolledby the government.The government'sstrict control over the financialsystemhashelped to divert the attentionof Chaebols towardscapitalaccumulationby closing off theoptions available for rent seeking. A well-defined technology policy has been an integralcomponentof the government'sbroader ndustrialstrategy.Technologyhas been acquiredthrough nvesting in foreign licensing and technical assistance. Massive importsof foreignlicenses have been conceived of as the principal means of attaining technologicalindependence.Directforeigninvestmenthas playeda comparativelyimitedrole as avenuesof capitalinflow andtechnologytransfer n the Koreaneconomy. Finally, the government'sfiscal policies have complemented ts highly interventionist ndustrialpolicies. Expendituresfrom the budgethave been directed almost exclusively to long-terminvestment. The statehas invested heavily in education and human capital formation. Yet the welfare statefunction has been virtuallyabsent. The state has assumed no responsibilitiesoutside thedomainsof productionandcapitalaccumulation.The central insight to emerge from Amsden's study is that the governmentnot onlysubsidized industries to stimulate growth, but also set stringent performancecriteria inexchange for these subsidies. Hence governmentdisciplineover businesswas crucial, andthis dual policy of supportand discipline constitutesthe core componentof a JapaneseorKoreanstyle industrialpolicy. Herewe have a strongcontrastbetween East Asia andmanymiddleincomeeconomies which have madeextensive use of subsidiesto industry.Preciselybecause of the latter's failure to integrate subsidization with discipline over businessperformance, hese subsidieshave provedto be counterproductivend emergedas a majoravenue for rent seeking.

Institutional and Political Bases of the Developmental StateThe formulationand implementation f strategicindustrialpolicy have been facilitatedbyspecific political and institutionalarrangements. nterestingcontributionsby Deyo and by

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Koo and Johnsonin the same volume make important ontributions owardsunderstandingthe two differentfacets of the developmental tate.5A key distinction s introducedbetweenthe politicalbasis for strong,autonomousdevelopmentalist tatesandthe institutionalbasisfor state intervention nd effective policy implementation.The formeraspectdrawsattentionto the broadersociopolitical context which facilitated strategyformulation. The strategicpower of the East Asian developmentalstate has dependedon the formation of politicalcoalitions with domestic industryand on the destructionof the left and curtailmentof thepowerof organized aborplusotherpopulargroups.Stateintervention, n turn,has relied onorganizationaland institutional inks betweenpolitically insulatedstate agencies andmajorprivatesector firms. The effectiveness of state interventionhas been amplified through hefosteringof state-linkedprivatesectorconglomerates,banks,andgeneraltradingcompaniesthatdominatestrategicsectors of theeconomy.The distinctionbetween the coalitionbasis ofstrategychoice and the institutionsand structures hroughwhich policies are implementedrefers to the two separate,yet fundamental,aspectsof developmentcapacity.Underlying hese politicalandinstitutional equirementsor effective state intervention nthe form of strategic industrialpolicy are the two central features associated with thedevelopmental state, namely, the unusual degrees of bureaucratic autonomy andpublic-private ooperation.The coexistence of these two conditions allows the state andthebureaucratic lites to develop independentnationalgoals and, in the subsequentstate, totranslate hese broadnationalgoals into effective policy action. The coexistenceof these twoconditions is critical. In fact, in the absence of bureaucraticautonomy public-privatecooperationeasily degenerates nto situations n which state goals are directlyreducible toprivate interests. Countries such as Mexico and some of the other bureaucratic-authoritarian tates in Latin America arestrikingexamplesof such politicaleconomies, inwhich close government-business ooperationhas materialized in the context of weakstates which lack autonomyfrom powerful groupsin society.Froma comparativeperspective,among the most puzzling and intriguingaspects of theEast Asian developmentalstate are how bureaucraticautonomywas acquiredin the firstplace and why it was subsequentlydirected to developmentalgoals as opposed to theself-maximizingor predatoryorms of behaviorso commonin othercontexts. An extremelymeritocratic form of recruitment constitutes the starting point in understandingtheextraordinarydegree of bureaucraticautonomyassociated with the developmentalstates.The system was designed in such a way as to attract he best managerial alentavailable tothe ranksof the bureaucraticlite, which in numerical ermswas quitesmallby internationalstandards.Rigorous standardsof entry not only ensured a high degree of bureaucraticcapability,but also generateda sense of unity and common identity on the part of thebureaucratic lite. Hence the bureaucratswere imbuedwith a sense of mission andidentifiedthemselveswith nationalgoals which derivedfrom a position of leadership n society. Theearlyretirement f the elite bureaucrats nd theirsubsequentmove to toppositionsin politicsand business also helpedto enhance theirpower and legitimacy. The common educationalbackgroundsplus the highdegreeof intraelitecirculationwere instrumentaln generatinganunusualdegreeof cooperationamongthebureaucrats,heexecutive, and the entrepreneurialelites.

All bureaucraticystems are confrontedwith an inherent ension betweenautonomyandaccountability.Autonomy from both societal interestgroups and other layers within the114


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Ziya Oni?state is a necessarycondition for effective action.Yet the powersgranted o the bureaucraticelites may easily be misused in the absence of externalchecks and balances on bureaucraticpower. In the context of the developmentalstate, several mechanismswere institutedwiththe purposeof resolving the tension between bureaucraticautonomyand accountability.First, the size of the bureaucraticapparatuswas kept extremely small by internationalstandards.The limitedsize of the bureaucracy elped to consolidatethe elite positionof thebureaucrats n society and also to contain the problems involving lack of control andaccountabilityassociated with massive bureaucracies.The second element designed toachieve an equilibriumbetweenautonomyandaccountability oncernedthe powers grantedto pilot agencies such as MITIin JapanandEPB in Korea, which emergedas the principalinstitutionsresponsible or the implementation f industrialpolicy. The problemherewas tofind the mix of powers neededby the pilot agency withoutgiving it control over so manysectors as to make it all-powerfulor so few as to make it ineffective. The dilemma wasresolvedby confiningthepowersof MITIto a limited numberof selectedstrategicsectors ofthe economy. Hence the patternof MITI's (or its Korean and Taiwanese counterparts')involvement in the economy was consistent with both the economic logic of selectiveindustrialpolicy, basedon infant ndustryprotection,and the logic of findingan equilibriumbetween bureaucratic utonomyandeffectiveness, on the one hand, and bureaucratic owerandaccountability,on the other. The thirdmechanismwherebyautonomyandaccountabilitywere reconciled involved the unusual division of labor within the state, among theexecutive, bureaucrats,and military. The relationship between the executive and thebureaucracy s particularly nteresting. Johnson draws attention to a striking structuralcharacteristicof the developmentalstate, the implicit division of labor within the politybetween the tasks of ruling and the tasks of reigning. Politiciansreign while bureaucratsrule. The politicians provide the space for the bureaucrats o rule by holding off specialinterestclaimantswho mightdeflect the statefrom its maindevelopmentalpriorityand alsolegitimateandratifythe decisions takenby the bureaucrats.The existence of an independentexecutive is crucialfor the operationof the system in the sense thatit allows the bureaucratsthe freedom of action necessary for effective policy interventionbut at the same timeconstitutesan importantbarrier o the misuseof this freedom of action. The taskperformedby the military n KoreaandTaiwanhas been similar to the role performedby the executiveor the politicalelites in the context of postwarJapan.The commitmentby the militaryelitesto developmentalgoals as a meansof securingnationalsurvivaland independencehas beena key factor in ensuring the effective deployment of bureaucraticpower. As a fourthelement, in spite of the inherentweakness of civil society in the EastAsian context, certainelements within civil society have nevertheless contributedto the process of increasedaccountability.Amsden singles out the hyperactivestudentmovementin the Koreancase,which has helpedto check the abuse of bureaucratic ndgovernmentalpowers.The logic of the developmentalstate rests precisely on the combinationof bureaucraticautonomy with an unusual degree of public-private cooperation. Common educationalbackgroundsof the bureaucraticand business elites, as well as their significant crosspenetration,have playeda key role in generatingextraordinary egreesof elite unity.Yet itwould be rathermisleading to attributepublic-private cooperation exclusively to theseforces. Public-private ooperationhas also been directlyanddeliberatelyengineeredby thestate elites. InbothJapanand the otherEast Asian states which have evolved alongthe lines

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ComparativePolitics October1991of the Japanese model, the state elites have consciously sought to create cooperativerelationshipswith privatebusiness via the creationof a series of unusualinstitutions. Forinstance, the state has played a leadingrole in nurturinghe peak organizationsof privatebusiness.The hugebusinessconglomerates, he Keiretsuof postwarJapanand the Chaebolsin Korea,owed theirphenomenalgrowthto the special incentivesprovidedby the state.Thefact thatthey have been nurturedby the state in the first place has, in turn,rendered hemextraordinarily ependenton the state for their future survival. Hence the extremely tightpolicy networkswhich characterizeEast Asia have been largely engineered by the stateelites. It would be misleading, therefore, to conceive public-private cooperation as anoutcome of voluntary compliance by the business elites. The significant element ofcompulsionexercisedby thebureaucratsn securingpublic-private ooperationconstitutesacentralcharacteristic f the developmental tate.The extraordinary egreesof monopolyandcontrol exercised by the state over the financial system plus the extreme dependenceofindividual conglomerates on bank finance have also been instrumental in elicitingcompliancewith the requirements f strategicindustrialpolicy.The centralinsight is that the degree of government-business ooperationand consensuson nationalgoals, uniqueto the developmentalstate, is not purelythe productof a givenculturalenvironmentbut has been largely engineeredby the state elites themselves throughthe creationof a special set of institutionsrelying on a significantelementof compulsion.

The Historical Origins and Specificity of the East Asian Developmental StatesTo an externalobserver,one of the centralpuzzles posed by the EastAsian industrializationexperience is how to explain the single-mindedcommitmentof the state elites to growth,productivity,and international ompetitiveness.One possible line of explanationtends tofocus on regime type, namely, the authoritarianolitical structuresassociated with the EastAsian states. It is a well-known fact, however, that authoritarianregimes, like theirdemocraticcounterparts, re confrontedwith theproblemsof legitimacyandtypicallyfail togenerate the consistency and commitment to national goals characteristicof East Asiandevelopmentalstates. Hence we need to search for more penetratingexplanationsof theintractable ommitment o long-termgrowth.Two factors,both of which are the productsofspecific historicalcircumstances,deserve special emphasis.

The first element involves the unusualdegree of external threat confrontedby the EastAsian states in the postwarperiod.The securitythreathas been aggravatedby the extremelyweak resourcebase andshortageof rawmaterials n the economies concerned. The securitythreathas been particularlypronounced n the case of Taiwan, which faced an immediatethreat rom mainlandChina.The fact that these nations were underdirectCommunist hreatimpliedthatthey had to justify theirveryexistence againstcompetition romthe Communistregimes and associatedideology. Hence the extraordinary ecuritythreatfaced by the EastAsian stateshelpedto bolster the nationalisticvision inherent n these states and the uniquecommitment o the long-term ransformation f the economy, which enabledthe state elitesto ignoreconsiderationsrelatingto income distributionand social welfare.

Geopolitical nfluences, however, constituteonly one element of the legitimationprocess.The second element concerns the fact that the major East Asian economies under116


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Ziya Oni?considerationall experienceda majorredistribution f income and wealth from the outset,with the corollarythat the industrializationdrive in the postwar period has been initiatedfrom a relatively egalitarianbase. In the Japanesecase, the devastating mpactof the warwas such that all Japanesewere made equally poor. In the cases of Korea and Taiwan,extensive land reformsduringthe processof colonial ruleperformeda similarfunction.Theimpactof the landreformswas such that, not only was the distributionalprofileequalized,but also competition rompotentiallytroublesomesocial groupssuch as largelandlordswaseliminated.Precisely in this respectwe observe a strongcontrastwith the Latin Americanexperience. Hence we should locate the unusual and exclusive attachmentto economicgrowthand competitiveness n the combinationof extraordinary xternalthreatscombinedwith a relatively egalitarian distribution of income prior to the process of rapidindustrialization.

Cumings'contribution s particularly mportant n accountingfor the origins of the EastAsian developmental states.6 Cumings locates the historical origins of East Asianindustrializationn the broaderregionalcontextof Japaneseand then Americanhegemony.UnderJapaneserule, extensive industrialand infrastructuralnvestmentprovideda base forsubsequent ndustrialgrowth in Korea. The build-upof the bureaucratic pparatusand theassociated administrative apacitywere also to a largeextent productsof Japaneserule. Inthe postwar period, Korea and Taiwan assumed a key geostrategic significance, and as aresult of theirnewly acquiredgeostrategicadvantage hey have benefiteddisproportionatelyin terms of trade,capital,andtechnologyfromthe core countries.Henceany analysisof theEast Asian developmentalstate has to take into account the international ontext withinwhich EastAsian growthmaterialized n the postwarperiod.Unlikethe experienceof manyThird World states, Korea and Taiwanbenefitedfrom heavy interactionwith the strongestand most dynamiccountrieswithin the cores, the United StatesandJapan.Yet, as Haggardand Chengdemonstrate, t was not only the special natureof theirinteractionwith the corewhich explains their superior success, but also the way that they have managed theirinteractionwiththe externalenvironmentwithrespectto bothtradeandcapitalinflows 7 Thestrengthof the East Asian states enabled them to direct and limit the impact of foreigncapital in local economies. Here again we locate a strong contrastwith Latin America,whose dependent relationshipvis-a-vis the core has been attributed o the interactionofpowerful foreign firms with relatively weak states, amply demonstrated n Peter Evans'comparative analysis.8 The key point made by Koo is that the internationalcontext,combinedwith the domesticstructural haracteristics escribed,enabledstrongauthoritarianstates to emerge in EastAsia priorto reintegrationnto the U.S.-dominatedcapitalistworldeconomy in the postwar period. Hence, in retrospect,the timing of incorporationnto theworld economy appears o be crucial for the subsequentsuccess of the East Asian states.Anotherstrikingcontrastwhichexplainswhy the East Asian states did not experiencethelegitimation problemsconfrontedby the bureaucratic-authoritariantates in Latin Americacan be traced to the exclusion of labor from the political process from the outset.9 Thecorporatistregimes in Latin Americannewly industrializing ountries(NICs) incorporatedlabor into a populistcoalition and emphasizedincreasedwages and public services in theearly stages of industrialization. The subsequent bureaucratic-authoritarianegimes inArgentina,Brazil,Chile, andUruguayaimed to promote ndustrialization y excludingfrompower the previously mobilized economic groups and by developing collaborative

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relationshipswith the multinational orporations.The fact that suchregimeshave been builton the exclusion of previouslymobilizedgroupshas generatedsevere legitimationproblemsfor them.Ourdiscussionhashitherto ocused on theessentialunityof the East Asiandevelopmentalstates. Yet a closer analysis suggests the presence of striking differences among theindividual variants of the developmentalstate. The Japanese developmentalstate in thepostwarperiod, for example, has differed from its Koreanand Taiwanesecounterpartsnthat it hasbeen able to coexist withdemocraticpoliticalinstitutions.Important ontrastsmayalso be identified between the Korean and Taiwanese models. Wade demonstrates,forexample, that Taiwan satisfied Johnson's bureaucratic utonomy condition but failed toconform to the public-private cooperation condition and in this respect differedsignificantly from both Japan and Korea. Close cooperation and interaction amongpoliticians, bureaucrats, and business elites have been the foundation stone of thedevelopmentalstate. Yet, compared o Japanand Korea,Taiwan has been characterizedbymore of a cleavage between the government and the private sector. Given the weakinstitutionalized inks between governmentand business, industrialpolicy in Taiwan hasbeen implemented hrougha rigorousbut very differenttype of policy networklinking thecentraleconomic bureauswith public enterprises,publicbanks,publicresearchand serviceorganizations,universities, foreign multinationalswith operations in Taiwan, consultingfirms, and some special status private manufacturingcompanies linked to the party,military,and economic ministries.Hence the publicsectorhas been a centralcomponentofthe policy network n Taiwan.The differentpolicy networkwhich prevailed n Taiwanmayalso be explained by the relative absence of a limited number of extremely largeconglomerates, characteristic of Japan and Korea. This also explains why the

public-private ooperation condition could not be fulfilled in the Taiwanesecase. What isquitecriticalin the presentcontext is that the vision of a uniformEast Asian developmentalstateis misleading.Infact, in spiteof substantial imilaritiesamongthe Korean,Taiwanese,and Japanesecases, the presence of importantdifferences should not be underestimated,particularlyn tryingto generalizefrom the East Asian experience.

The Developmental State and CorporatismAt a very broad and general level of analysis, it is possible to formulatea correspondencebetween the East Asian model of the developmental state and corporatist politicalarrangements.At one extreme, both Korea andTaiwanappear o conform ratherclosely tothe patternof authoritarianorporatism, which involves institutionalizedcollaborationbetweenthe state andbusinesselites in the policy formulationand implementationprocess,accompanied(at least until very recently) by severe repressionof populargroups and theexclusion of labor from the political arena. In contrast to Taiwan's and Korea'sauthoritarian r exclusionary corporatism,the political arrangementsunderlyingtheJapanese developmentalstate in the postwar period have been much closer to the westernEuropeanor Scandinavianmodel of societal or democratic corporatism.' In the caseof Japan,close, institutionalized ooperationbetweenthe stateelites and businessgroupsforthe realizationof strategicgoals hascoexisted with democraticpolitical institutions.Clearly,118


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Ziya Oni?the common denominator in both the authoritarian and democratic forms ofcorporatism is institutionalized public-private cooperation in the process of policyformulationand implementation.Attention drawn to the corporatistnatureof the developmentalstate serves at least oneimportantpurpose. It is unambiguously he case thatthe model of the developmentalstateexplored in the present essay is inconsistent with the vision of a pluralistic form ofdemocracy, in which a multitude of small-scale interest groups enjoy broadly equal andunrestrictedaccess to the state. By definition,restrictedand preferentialaccess to the stateby organizedgroupsin civil society is an inherentand integral eatureof the developmentalstate. Moreover, the developmental state by its very nature involves an unusualconcentrationof publicand private power which would be extremelyhardto justify by thestandards of pluralistic democracy. The emphasis on the corporatist nature of thedevelopmentalstate also helps to draw a broad parallelbetween the two major groups ofcountries which constitute the major success stories of outward-orienteddevelopment,namely the small Europeancountries, on the one hand, and the East Asian group, on theother. The common element in whatoriginally appears o be exceptionallydissimilarcasesis that both sets of countrieshave managedto build over time institutionaland politicalarrangementswhich have facilitated highly effective forms of integration into theinternational conomy. The natureof the internalpolitical arrangementswas crucial to theability of these groupsof countriesto successfully managetheir association with the worldeconomy and theirsubsequentability to benefit from this interaction.Beyond this level of abstractcomparison, however, the emphasis on the corporatistcharacterof the developmentalstate mightbe more misleadingthanilluminating.Considerthe paralleldrawnby Johnsonbetween the postwar Japanese developmentalstate and theEuropean ype democraticcorporatism.The fundamentaldistinguishingcharacteristic f thelatteris thatpolicy is formulatedand implemented hrough nstitutionalizednteractionandcooperationbetween the politiciansandbusiness, on the one hand, andpeakassociations oflaborandbusiness, on the other. Central o the idea of democraticcorporatisms the notionthat relatively autonomous state elites bargainwith autonomouspeak associations withincivil society. Yet it is quiteobvious thatthis vision of democraticcorporatismdeviatesfromthe postwarJapanesemodel in a numberof criticalrespects.First, in spiteof the presenceofdemocraticinstitutions, labor has been systematicallyexcluded from the policy process.Second, it could be incorrect to characterize the policy formation and implementationprocessin Japanas theoutcome of bargainingbetweenequal, yet independent,partners.Thestudies reviewedin this essay suggestthatin Japan,andperhapseven more so in KoreaandTaiwan, the state has possessed considerableleverage over private business in terms ofsecuringcompliancewith its strategicchoices. The stateelites haveunambiguouslybeen thesenior partner n their relations with business groups. Hence the degree of autonomyandstrengthassociatedwiththe EastAsianmodelshasbeenconsiderablygreater hanthedegreeof state autonomyassociated with the Europeantype democraticcorporatism.It is quiteself-evidentthatJapanconforms to a model of an extremely imitedform of corporatism.Ata moregenerallevel, the conceptof corporatismmakes sense as a means of identifying,asan ideal case, the characteristics associated with the Scandinavian or Austrian typedemocraticcorporatismplus the contributions hat such institutionalarrangementsan makein termsof politicalstabilityandimprovedeconomicperformance.The idealcase may, in

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turn,be utilizedfor the purposeof broad,macro-levelcomparisonswith the otherpoliticalarrangements nd systems. However, to extend the limits of corporatismbeyond this idealcase and to search for the presence and strengthof corporatist arrangement n highlydissimilar contexts reduces the usefulness of corporatismas an analytical concept formacro-comparative nalysis.The concept of authoritarian orporatism constitutes a loose category and is lesssatisfactory than democraticcorporatism in defining an ideal type. Hence, in ourjudgment,the characterization f Koreaand Taiwanas variantsof authoritarianorporatismis meaningfulonly at a descriptive evel. Wademakes the importantpointthat one can notdeduce the degreeof statestrengthor specific policy choices fromthe underlyingcorporatistpolitical arrangements.Mexico, for example, is considered o be a prototypecase of stateor authoritarian orporatism n the context of a single party regime.'2 Arguably,as aconsequenceof its corporatistarrangements,Mexico has enjoyed a high degree of politicalstabilitywhich is unusualby Latin Americanstandards.Yet the authoritarianorporatismmodel associated with the Mexican case has been consistent with a very different set ofstrategicchoices andpolicy outcomesas comparedwith the KoreanandTaiwanese models.Moreover, in spite of its authoritarianorporatist haracteristics,Mexico has hardlybeen acase of economic success. The generalpoint emergingfrom the discussion is thatthe EastAsian developmentalstate, in a very loose sense of the term, may be classified as acorporatiststate, in the sense that institutionalizedgovernment-business ooperationis anunderlyingfeature of such a state. Yet, at a deeper level, the characterization f the EastAsian developmentalstates as corporatiststates is ahistoricaland misleading. Corporatistarrangements y themselves,without recourseto a full rangeof conditionsspecifiedearlier,can not explainwhy the East Asian stateshave elected to pursuestrategic ndustrialpoliciesand why such policies have provedto be so effective in practice.Furthermore, orporatistarrangements an be consistent with and have in fact facilitatedthe achievement of quitedistinct objectives such as macroeconomic stability plus income redistributionand thebuild-up of the welfare state, hardly the objectives associated with the logic of thedevelopmentalstate.

Is the Developmental State Model Transferable?To a practicallyminded scholar, the immediatequestionconcerns the lesson to be drawnfrom the EastAsian developmentexperiencewhich can subsequentlybe generalizedto andapplied in other newly industrializingcountries. In our judgment, such an approachisextremelyahistorical.In fact, the studies under review demonstratequite conclusively thatthe East Asian model of the developmental state is the product of unique historicalcircumstances with the logical corollary that there exist major constraints on itstransferabilityo or replicability n alternativenationalcontexts.Threekey elements of the developmentalstate are extremelydifficult to emulate. Theyare the single-mindedadherenceto growth and competitivenessat the expense of otherobjectives, the unusual degree of bureaucraticautonomy and capacity, and the equallyunique and unusual degree of public-private cooperation. As emphasized earlier, thesingle-mindedpursuitof growthand productivitywas clearly relatedto the severe external120


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Ziya Oni?threats that these countries were confrontedwith. While external threats have helped tolegitimize the long-termgrowth strategy, he geostrategicpositionof these states in the coldwar context enabled them to extract importantadvantagesvis-a-vis the core, the UnitedStates in the case of Japanand both the United States and Japanin the case of Korea andTaiwan, which have made a significant contributiontowards the consolidation of stateautonomyas well as the formation of state capacity. In the domestic sphere, Korea andTaiwanbenefitedfrom the unusualcombinationof an authoritarianegime and a relativelyegalitariandistribution,which itself was the productof particularhistorical circumstances.Consequently, he East Asian states have been able to withdraw romthe distributional ealmand concentrateexclusively on providing strategic guidance for productionand capitalaccumulation.A fundamentalquestioncenters around the compatibilityof the developmentalstatewith political liberalizationand democraticforms of governance.This also raises the keyquestionwhetherthe transferor replicabilityof the EastAsian state formsis desirable n thefirstplace, in environmentswhere democraticvalues and institutionsas well as widespreadpolitical participation mergeas centralobjectivesin theirown right.It is self-evident thatincountrieswhich have experienceda long trajectory f democraticdevelopmentit would beinconceivable for the state to withdrawentirely from the distributionalrealm and focusexclusively on growthandproductivityobjectives.At a deeperlevel, the extremedegreesofconcentrationof private and public power associated with the East Asian developmentalstates could also be incompatiblewith widespread political participation.Although suchconcentrationof privateand public power has been consistentwith a democraticpoliticalsystem in Japan n the postwarperiod,this coexistence was moredue to the uniquefeaturesand structuralimperatives of Japan as distinct from an inherent compatibility of thedevelopmental state with democratic institutions. As Korea and Taiwan currentlyfindthemselves in the process of democratictransition, it would be extremely interestingtoobserve whether and to what extent the institutionsof the developmentalstatewill surviveunderconditionsof popular participationand democraticgovernance.Hence the questionwhetherEast Asian type politicaleconomies can coexist with a liberalwesterntype politicalsystem emerges as a centralproblemfor comparativepolitical economy during the nextdecade.Another critical issue in this context revolves around the long-term stability of thedevelopmental tate. Severalscholars, includingAlice Amsden, have drawnattention o thefact that the East Asian developmentalstate is inherentlyunstable.There exists an inherenttension within the developmental state between the bureaucraticautonomy and thepublic-private ooperation conditions. The Koreanexample, for instance,clearlytestifiesthatthe developmentalstate creates the seeds of its own destruction.As arguedearlier, theKorean state has been instrumentaln the creationof privatebusinessgroups, Chaebols,asa basis for securing cooperationfor its industrialpolicy and enhancing its autonomy inimplementing ts strategic goals. The recent evidence suggests, however, that the Koreanstate has been increasinglyunable to control or monitor the activities of the Chaebols. Infact, the relativepower and autonomyof the Chaebolshave increaseddramatically n thecourse of the liberalizationdrive duringthe 1980s, which in turnhas progressively imitedthe capacityof the state to control the actions of these groupsand to direct them towardsstrategic goals. The Korean example illustrates quite conclusively that it is extremely

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difficult to engineer an equilibriumbetween the two apparentlycontradictoryconditionsbureaucraticutonomy and public-privateooperation and to sustain it over time. Theknife-edge equilibriumcan easily be disturbed due to the more rapid growth of privatevis-h-vis public power.It is quite obvious that, unless the autonomy and cooperation requirementsaresatisfied, attempts o implementJapaneseand Koreanstyle industrialpolicies will prove tobe counterproductive.n such an environment,bureaucratic lites will lack the capability oidentify dynamicindustries o be targeted n the firstplace andwill be in a weak positioninterms of monitoringandregulating he activities of firms located in the strategic ndustries.The inabilityof the state elites to disciplineprivatebusinessin exchange for subsidiesmaylead to a situationwhereselective subsidiescan easily degenerate ntoa major nstrument frent seeking by individualgroups. A central lesson that emerges from the institutionalistliteratureon East Asian development s that the transferof specific strategiesor policies tonew environmentswill be self-defeating in the absence of the political and institutionalconditionsrequired or theireffective implementation.We also need to take into accountthefact that the East Asian style developmentalstate and associated industrialpolicies haveprovedto be successfulin a globalenvironment haracterized y rapidgrowthof productionand world tradeandalso by the absenceof similar nstitutionsandstrategies n the restof theinternationalystem. Theobviousquestionto pose is whethersuch institutionsandstrategiesare likely to be effective in a less favorableenvironment ypified by growing protectionismand declining growthin world trade.Moreover,are such institutionsand policies likely towork in an environment in which other nations are trying to adopt similar types ofinstitutionsandpolicies?On a more optimistic note, however, some important, yet qualified, lessons can beextracted from the East Asian model of the developmental state with a view to itsapplicability in alternative national settings. A key lesson is that there is no obviouscorrespondencebetween effective market-augmentingtate intervention,on the one hand,and the size of the bureaucratic pparatus r the publicsector, on the other. The EastAsianmodel of the developmentalstate testifies thathighly effective forms of market-augmentinginterventioncan be consistent with relatively small bureaucraticstructures and publicsectors. Yet, contraryto popularbelief, small public sectors have neverthelessembodiedhighly productiveand profitable public enterprisesectors. Anotherkey message is that asmall but powerful pilot agency such as MITI or EPB can provide important strategicguidancein the selection of key industries o be encouragedand also in the provisionof astable and predictableenvironmentfor private investors to undertakerisky, long-terminvestmentprojects.Hence sector-specificforms of indicativeplanningcan be an essentialcomplement of market-orientedgrowth. Effective market-augmenting orms of stateintervention equirebothbureaucratic utonomyandclose public-private ooperation.Theseinstitutionalconditions are not easily transferable,but they are not the unique productof aparticularculturalenvironmenteither. Factors such as traditionsof social and politicalhierarchyandgroup solidarityhave playedan important ole in EastAsian industrialization,but it would be wrongto associatethe degreeof social consensusandcooperationassociatedwith the East Asian developmentalstate purely with cultural explanations.'3ChalmersJohnson's accountis particularly rucialin this respect. Johnsondemonstrates hatthe keyinstitutionsunderlyingrapid economic growth in Japan are of relatively recent origin.122


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Ziya Oni?

Similarly, the consensus and cooperation which constitute the central pillar of thedevelopmental state are a specific postwar phenomenon. The rejection of the purelyculturalist xplanationhasanimportant amification,namely,thatbureaucraticapabilityandpublic-privatecooperationare not culturalgivens but can be built up over time throughaprocess of institutionalreform. Hence bureaucratic eformas well as attemptsto instituteorganized forms of bargainingand cooperationbetween the public and private spheresassumecriticalimportanceas a basis for improving he effectiveness of state intervention na market-orientedetting. The challenge for the political economist is to devise forms ofindustrialpolicy which are consistent with the normsof democraticaccountabilityandwithmore limited concentrationof public and private power than has been the case in the EastAsian context.

Towards a New ParadigmInstitutionalist ccountsof the East Asian developmental tatesembodyimportant amifica-tions for moregeneraldebates in comparativepoliticaleconomy concerningstateautonomyand state capacity.'4A centralinsight concerns the precise meaningto be attachedto thenotion of a strongstate. The developmentalstate thesis suggests that strong states aretypicallycharacterized otonly by a high degreeof bureaucratic utonomyandcapacity,butalso by the existence of a significant degree of institutionalized nteractionand dialoguebetween the state elites and autonomouscentersof powerwithin civil society. Central o ourunderstanding f the strong developmentalstate is the distinctionbetween despotic andinfrastructural tate power. Despotic power or what we could preferto call coerciveautonomy may be associatedwith highly centralizedand authoritarian tatesin which thestate elites extensively regulateeconomic andpoliticalactivitybut at the same takedecisionswithoutroutine, institutionalizednegotiationswith groups in civil society. Infrastructuralpower, in contrast, signifies the ability of the state to penetratesociety, organize socialrelations,and mplementpolicies througha processof negotiationandcooperationn society.15The crucial point to emphasizeis that highly centralizedand authoritariantates whichpossess despoticpower will not necessarilyhave the infrastructuralower which wouldallow them to elicit consent for theirpolicies, organizeand coordinatesociety, and mobilizeresources or long-termdevelopment.Some degreeof autonomy romsocietalpressures s apreconditionfor effective state intervention. Yet the distinction between despotic andinfrastructural ower implies that there exists no direct, linear correspondencebetweenstate autonomy and state capacity. From the perspective of long-term economictransformation,he most successful states aretypicallythose which are able to workthroughandin cooperationwith autonomous entersof power.16 Theautonomyof thedevelopmentalstate is of a completely different character rom the aimless, absolutistdominationof thepredatory tate .. It is an autonomyembedded n the concreteset of social ties whichbindstate and society and provide institutional channels for the continuous negotiation andrenegotiationof goals and policies. The specific natureof this 'embeddedautonomy'mustbe seen as the productof a historicalconjunctureof domesticand internationalactors. 17

The notion of embeddedautonomy, which Peter Evans uses to characterizestrongdevelopmentalstates in the Third World, also has a direct counterpartn the corporatist123


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literature f a strongstate in the contextof advanced ndustrial conomies. In the corporatistliterature, he state performsa key role in the creation and the subsequentconsolidationofcorporatist arrangements involving peak associations of labor and private business.Corporatistarrangementsacilitate the implementationof both incomes policies to controlinflationandsectoraladjustment olicies for smoothindustrial ransformation.The abilityofthe state to establishand consolidatecorporatist tructuresdependson two basic attributes,which areperfectlyconsistentwith the generalthrustof ouranalysis.First,the statemustbeautonomous enough in the policy formation and implementationprocess not to beoverwhelmed by special interest groups. Second, the state must be weak enough torecognize that the costs of imposing a policy authoritativelywill exceed its benefits. Thestatemustalso be willing to relegatesome of its mostdistinctresource,legitimatecoercion,to organizationswhich it does not control.

Selective interventionism onstitutesa fundamental haracteristic f the strongstate. Suchstates seem to be able to focus theirattentionalmostexclusively on increasingproductivityand profitabilityand restricttheir interventionto the strategic requirementsof long-termeconomictransformation.Neithera largepublicsector nora large public enterprise ectorisnecessary for the state to undertake its strategic role in the process of economictransformation.ndeed,the very size of thepublicsector,combinedwithpervasivesubsidiesand controls, nurtures he proliferationof special interest groups, whose rent seekingactivities may seriously impede state capacity for effective intervention. Similarly, anexcessively large public enterprise sector may undermine the strength of the centralgovernment hrough he emergenceof clientelistic relations.The type of interventionassociatedwith the developmentalstate embodies three majorcomponents.First, direct ownershipand control of industrialproductionis of secondaryimportanceas comparedwith the process of building up economic infrastructurehrougheducation,training,andresearch.Second, the stateperformsa key role in the promotionofcooperative abor-managementelations.Third,andmost significant,the stateundertakesaleadingrole in the creation of comparativeadvantage.The state is involved in creatingtheconditionsfor economic growthand industrialadaptation,yet refrains romexercisingdirectcontrol. A central feature underlyingthis process is that the state works with and oftenpromotes the market. The market is employed as an instrumentof industrialpolicy byexposing particular ndustries o international ompetitive pressures. Developmentalstatessystematicallymanagethe market as a means of long-termeconomic transformation.Theabilityof the stateto undertake elective, yet strategic nterventions based on the existenceof strong administrative apacity. Again, what matters is not the size of the bureaucraticapparatus,but its coherence. Developmentalstates are characterizedby tightly organized,relatively small-scale bureaucratic tructureswith the Weberiancharacteristicsof highlyselective, meritocratic ecruitment atternsandlong-termcareerrewards,which enhance thesolidarityand the corporate dentityof the bureaucratic lite.Institutionalperspectives embodied in the developmental state model make anotherimportant ontributiono the broader omparativepolitical economy literature y developinga seriouscritiqueof the neoclassical andpublicchoice schools of political economy. In fact,both the institutionalistand public choice scholars start from a common base of a highdegreeof state or bureaucratic utonomy.The idea that the stateelites constitutea distinctinterestgroup,which we associatewith the institutionalist erspective,is closely reflected n124


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Ziya Oni4the contributionsof the public choice school. Public choice analysts, however, entertainhighly deterministicnotions concerningthe manner in which state autonomyis utilized inpractice. They arguethatautonomousactionby self-maximizingbureaucrats ndpoliticianswill necessarilyresult in malevolent state action and misallocations of resources. Hence adirect correspondence s postulatedbetween bureaucraticautonomy and the model of apredatory tate, in which the state elites extractlarge investable resources but providelittlein the way of collective goods in return so that they act as a barrierto economictransformation.The logical corollaryof this reasoningis thatconstitutionalrestrictionsareneededto containgovernmentgrowth.18Herelies the centraldifference betweenthe publicchoice and institutionalistreasoning. The latter does not prejudgethe issue regardingtheutilizationof state autonomy.Furthermore,t contendsthatstate action can have a positivedevelopmentaleffect. In general,whetherautonomous tate action will assumea malevolentor benevolentform dependson historicaland structural onditionsand can not be deducedfrom first principles.Furthermore,t treatsstate autonomynot as a permanentor absolutecondition, but as a highly contingentor historically specific phenomenon.The degree ofstate autonomy may vary significantly from one country to anotheras well as betweendifferent historicalepochs withinan individualcountry.To make the argumentconcrete, inthe East Asian context the bureaucratic lite has identified tself with nationalgoals and hasdisplayed an unusual degree of integrity in attemptingto realize these national goals.Consequently,bureaucratic utonomyhas been associated withextremelyeffective formsofstate interventionn the economy. However, it was not bureaucratic utonomyperse whichensuredeffective stateaction, butrathera whole set of additional actors which collectivelyguaranteed hat bureaucratic utonomywas translated nto effective state action.

Finally, the institutionalist rameworkunderlying he developmentalstatethesis providesa serious critiqueof the one-dimensional,universalistlogic of neoclassical developmenttheory, with its emphasison a specific set of appropriatepolicies, designed to establish afree market, regardless of the historical, institutional, and political context. Theinstitutionalistlogic has also identified a set of policies, namely, market augmentingstrategicindustrialpolicies, which have been associated with high ratesof GNP growthinthe East Asian context. Yet the analysis also makes clear that the formulation andimplementationof such policies have been facilitatedby specific political and institutionalpreconditions.The corollary of this propositionis that the same set of policies will becounterproductiver at least ineffective in the absence of the associatedset of institutionalandpoliticalstructures r contexts. Hence the institutionalistperspectivepointstowardstheimportance of multiple logics in the interaction of governments and markets in thedevelopment process and draws attention to the multiple trajectoriesof economic andpolitical developmentavailable to present-daydevelopingcountries.

NOTESI would iketo thankEzraN. Suleimanorencouraginge to write hisarticle.1. Leading xamplesf neoclassicalevelopmentheory sappliedo theEastAsian ontext ncludeBelaBalassa,TheLessons f EastAsianDevelopment:nOverview, conomic evelopmentndCultural hange, 6 (April

1988),273-290;WalterGalenson,d., ForeignTrade ndInvestment:evelopmentn theNewly ndustrializingAsianEconomiesMadison:niversityf Wisconsin ress,1985).Onthedemise f structuralismndresurgencef

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ComparativePolitics October 1991neoclassical developmenttheoryfrom an orthodoxstandpoint,see I. M. D. Little, EconomicDevelopment:Theory,Policy and InternationalRelations (New York:Basic Books, 1982).2. See also GordonWhite, ed., DevelopmentStates in East Asia (London:Macmillan, 1988); Colin I. Bradford,East Asian Models: Myths andRelations, in John P. Lewis and ValerianaKallab, eds., DevelopmentalStrategiesReconsidered Washington,D.C.: OverseasDevelopmentalCouncil, 1986), 115-128; StephanHaggardandChung-inMoon, The South KoreanStatein the International conomy:LiberalDependentor Mercantile, n JohnG. Ruggie,ed., Antinomiesof Interdependence:National Welfareand the InternationalDivision of Labor(New York:ColumbiaUniversityPress, 1983), 131-189; StephanHaggardandChung-inMoon, InstitutionsandEconomic Policy: Theoryand a KoreanCase Study, WorldPolitics, 42 (January1990), 210-237; Alice Amsden, The State and Taiwan'sEconomicDevelopment, in PeterEvans, DietrichRueschemeyer,and ThedaSkocpol, eds., Bringingthe State BackIn (New York:CambridgeUniversityPress, 1985), 78-106; The Pacific Region: Challengeto Policy andTheory,special issue of The Annalsof the AmericanAcademyof Political and Social Science, 505 (September1989); HelenShapiroand LanceTaylor, The Stateand IndustrialStrategy, WorldDevelopment, 18 (June 1990), 861-878; PeterEvans, Predatory,Developmental and Other Apparatuses:A ComparativeAnalysis of the Third World State,Sociological Forum, 4 (1989).

3. In this respect, a close affinity may be established in terms of their conceptual frameworks between theinstitutionalist nterpretations f the East Asian experience reviewed in the present essay and the following studieswhichfocus primarilyon westernEurope.PeterA. Hall, Governing heEconomy:ThePoliticsof StateInterventionnBritain and France (New York: OxfordUniversityPress, 1986); Peter J. Katzenstein,Small State in WorldMarkets:IndustrialPolicy in Europe(Ithaca:CornellUniversityPress, 1985);JohnZysman, Government,Marketsand Growth:Financial Systemsand the Politics of IndustrialChange(Ithaca:Cornell UniversityPress, 1983).4. ChalmersJohnson,MITIand the Japanese Miracle (Stanford:StanfordUniversity Press, 1982), and PoliticalInstitutionsandEconomic Performance:The Government-BusinessRelationship n Japan,SouthKorea,andTaiwan,in FredericC. Deyo, ed., The Political Economyof EastAsianIndustrialism Ithaca:CornellUniversityPress, 1987),136-164.5. FredericC. Deyo, Coalitions,InstitutionsandLinkageSequencing:Towarda StrategicCapacityModel of EastAsian Development, Johnson Political Institutions, and Hagen Koo, The Interplayof State, Social Class, andWorldSystem in EastAsian Development:The Cases of South Korea andTaiwan, all in Deyo, ed.6. Bruce Cumings, The Origins and Developmentof the Northeast Asian Political Economy: IndustrialSectors,ProductCycles, and PoliticalConsequences, in Deyo, ed., pp. 44-83.7. StephanHaggardand Tun-Jen-Cheng, State and ForeignCapital in the East Asian NICs, in Deyo, ed., pp.84-135.8. PeterEvans, Class, State andDependence in EastAsia: Lessons for LatinAmericanists, in Deyo, ed.9. StephanHaggard, TheNewly IndustrializingCountries n the International ystem, WorldPolitics, 38 (1986),343-370.

10. On democratic orporatism, ee PeterJ. Katzenstein,Corporatismand Change:Austria, Switzerlandand thePolitics of Industry Ithaca:CornellUniversityPress, 1984), andSmall States in WorldMarkets;JohnH. Goldthorpe,ed., Orderand Conflictin ContemporaryCapitalism:Studies in the Political Economyof WesternEuropeanNations(Oxford:ClarendonPress, 1984). On the relationshipbetween democraticcorporatismand the state, see PhilippeSchmitter, Neo-Corporatism nd the State, in Wyn Grant,ed., The Political Economyof Corporatism New York:St. Martin'sPress, 1985), pp. 32-62.11. See the collection of essays in Ruggie, ed., Antinomiesof Interdependence.12. On state corporatism n the Latin American context, see Alfred Stepan, The State and Society: Peru inComparativePerspective(Princeton:PrincetonUniversityPress, 1978).13. For a culturalist nterpretation f East Asian development, see Peter L. Bergerand Hsin-HuangMichael Hsiao,eds., In Search of an East Asian DevelopmentModel (New Brunswick:TransactionBooks, 1988).14. See Evans, Rueschemeyer,and Skocpol, eds., Bringingthe State Back In.15. MichaelMann, TheAutonomousPower of the State: Its Origins, Mechanisms andResults, in John A. Hall,ed., States in History(Oxford:Basil Blackwell, 1986), pp. 109-136.16. JohnA. Hall and John G. Ikenberry,The State (Minneapolis:Universityof MinnesotaPress, 1989).17. Evans, Predatory,DevelopmentalandOtherApparatuses.18. On the public choice school of political economy, see William A. Niskanen, Bureaucracyand RepresentativeGovernment Chicago:Aldine-AthertonPress, 1971), and JamesBuchanan,Essays on Political Economy(Honolulu:Universityof HawaiiPress, 1989).

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