Industrialization and the State: The Changing Role of the Taiwan Government in the Economy, 1945–1998. Edited by Li-min Hsueh, Chen-kuo Hsu, and Dwight H. Perkins. [Cambridge, MA: Harvard Institute for International Development, 2001. v +350 pp. Hard cover £21.50, ISBN 0-674-00252-0; paperback £11.50, ISBN 0-674-00253-9.]

Extract

This is the first volume to introduce Taiwan's industrial growth both in the early years and in the recent period. The existing English and Chinese literature on post-war Taiwan economic history does not go beyond the mid-1980s. Despite studies of individual sectors and cases, a more general introduction about the economic adjustments since the late 1980s from a historical perspective has remained absent. Therefore, this volume to some extent can fill this gap in the literature. The book also uses some new materials about the policy process and the factors that influenced government industrial policy.

However, there are a number of weaknesses in the book. The theme of the volume – the role of government in economic growth – is not new. Readers may be disappointed to find that the book does not provide any new accounts of this issue. The major argument made by the authors is that the industrial success in Taiwan can be attributed to the state's capability to continually adopt new development strategies in response to changing circumstances. Thus, this is another volume on the statist paradigm that holds that a capable state is responsible for industrial success. The account provided by the developmental state thesis, a dominant approach in the statist paradigm, is an institutional approach – that the right institutional arrangements enable the state to formulate and implement its industrial policy to govern the market (see, Robert Wade, Governing the Market (Princeton, 1990)). What is the book's explanation for the government being able to adopt the right development models in response to changing environments? Do the authors agree with the developmental state thesis's argument of a strong state with autonomy and capability, or do they develop a new account? Surprisingly, no answers are provided. But without such an explanation, the argument is based on a shaky foundation.