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This chapter is a thorough examination of the concept of the developmental state (DS) – believed to be a key policy and institutional arrangement behind the greatest developmental successes of the second half of the twentieth century, often referred to as the East Asian miracle. The chapter is also concerned with the DS model's contemporary applicability and the extension of the DS debate to China. Is it a contemporarily valid recipe for underdevelopment or just a historical phenomenon with no relevance for the globalised world? In view of the spectacular developmental advancements of China and its geographical and cultural proximity to the countries of the East Asian miracle, among them Japan and Korea, there perhaps should be some reference and relevance. The chapter starts with an analysis of the features of the developmental state, which involves its economic and political conditionality. It examines the model's geographical and temporal limitations, the relations among the state's main actors, institutional and systemic arrangements, state ideology and state policies. Upon establishing a set of features and conditionalities, as presented in the scholarly literature, it is argued that the model's variation can still be contemporarily applicable. It is then explained how it extends to contemporary China.

This chapter discusses the role of civil servants and the state's role in economic development. It distinguishes between the developmental state and the good governance approaches. The developmental state argument is that the connection between the state and business is not simply one of ‘interference’ in or ‘direction’ of the market by the state. The good governance approach takes a normative view of the relationships, arguing for more clarity in the distinctions between institutions. The difference between the two is that the developmental state argument is essentially about the interconnectedness of the government and business spheres. The good governance approach is about creating institutional arrangements that break down the interconnectedness and establish more instrumental relationships between the two. This chapter also shows that there are different sorts of expressive connections in the different countries of the region and a different balance between rule by market and rule by connections.

Decades of high growth in Japan, Taiwan, and South Korea led a generation of scholars to herald the emergence of an East Asian ‘developmental state’ marked by internally coherent and cross-nationally comparable political economic institutions and policy packages. This chapter shows that scholars clearly overstated their early claims of an isomorphic East Asian developmental state model. More recent contentions of institutional divergence among the three are truer in form than in substance and predictions of the end of the East Asian developmental state are premature. Neither the path-dependent persistence of functional or dysfunctional institutions nor even piecemeal or wholesale evolutions away from these state–business arrangements warrant the conclusion that the outcome of these processes will yield convergence upon a neo-liberal order of capitalism. In seeking to account for these evolutions, the chapter argues that while emerging change coalitions, declining state strength, and a dominant policy discourse of neo-liberalism have attenuated the developmental states in all three national economies and in many cases dramatically shifted the form of industrial policy and state intervention, the substance of developmentalism remains.

This chapter shows how declinist literature about Korea are misleading. In their modeling of the East Asian developmental state, for example, declinists draw most heavily on the context-specific, highly centralized, and coercive Korean state of the 1970s—and the specific set of industrial policies it pursued in that period. Deviations from this highly specific set of institutional arrangements and policy instruments—of which there were a significant number in the post-1970s period—tend to be offered as evidence of the “dismantling” of the developmental state model. The chapter then develops a conceptual framework and defense of the developmental state idea, arguing that it is necessary to return ideas to the center of this important analytical framework in order to illuminate the process of developmental state evolution.

This chapter draws attention to debates on key models of economic and enterprise development that is those involving the developmental state model and neo-liberalism, as applied in emerging economies. It focuses on Southeast Asian economies, arguing that better informed insights into the benefits and repercussions of the form of development adopted by Southeast Asian economies can be obtained by deploying insights from two different bodies of literature: that on the developmental state and the literature on business history pioneered by Alfred Chandler. In combination, these insights help to explain the rise and fall of major enterprises in Southeast Asia, with further implications for our understanding of the nature of capitalism in this region.

This chapter extends the discussion offered by the chapters in this volume. It offers a critique of the tendency to see the regulatory state and the developmental state in antagonistic relations as if the regulatory state replaces the developmental state. At the same time, it offers a definition of a regulatory state: a definition that may travel backward and forward, beyond our era; one that will correspond with the theory of the state in general and with the state of the ‘South’ in particular. To do so it advances a polymorphic approach to the state — an approach that theoretically allows for the co-expansion of the developmental state and the regulatory state.

This chapter aims to explain Malaysia's industrialisation in terms of the East Asian developmental state model. This ‘model’ refers to a developmental state marked by the capacity to manage the process of late industrialisation, specifically: 1) the transfer of resources to more productive groups and sectors; and 2) learning and ‘catching up’. This chapter questions whether the East Asian developmental state can be transferred to developing countries, given its historical specificity. Although it may be relatively easy to replicate the sorts of capacities related to making the correct economic decisions by improving the quality of the bureaucracy, the political capacity of the state to implement decisions and enforce discipline is difficult to replicate because it is dependent on the political factors specific to a country. Hence, the notion of state capacity needs to be understood and seen in terms of historically specific social contexts, and, in particular, the balance of political forces that shape state motivations and constrain policy design and implementation. Here, the usefulness of the East Asian developmental state model for other countries will depend on the compatibility of institutions and policies with existing power structures.

A senior British civil servant working on economic issues declared in late 1930 (as the Great Depression ground on), “If I leave the office on Saturday feeling confident that in the past week I have done no harm, then I am well content.” The descendants of this breed of “do no harm” civil servants and its neoclassical economist counterpart forged the Washington Consensus world view about appropriate development policy in the 1980s, which has dominated “global policy” on development ever since. In post-war East Asia, however, civil servants and economists espoused a more activist role of the state, as in the slogan displayed in the entrance to the Industrial Development Bureau in Taipei (Republic of China): “The most important thing in life is to have a goal, and the determination to achieve it.” This essay examines the economic arguments against and for a more activist role of the state in giving directional thrust to the economy, and presents some considerations to guide the institutionalization of such a role.

This introductory chapter uses strategic coupling as an argument for a recasting of the dominant state-centric view of industrial transformation in South Korea, Taiwan, and Singapore. As a midrange concept that connects opportunities in the global economy to development outcomes in national economies (e.g., the rise of domestic firms in different industries) through firm-specific initiatives, strategic coupling helps in understanding industrial transformation and, ultimately, national economic development in an increasingly integrated global economy. The chapter provides a brief reprise of the developmental state in the three East Asian economies. These measurements of industrial attainment typically mask the important role of such economic institutions as national firms. The reprise also sets the baseline for the book's contemporary analysis of the evolving-state-global production networks (GPN) assemblage.

This chapter describes the developmental state model and discusses the formation of a developmental mindset in Korea. It pays particular attention to the shared formative experience of Korea's first developmentally minded policymakers under Japanese colonial rule, especially the experiences of Park Chung Hee, who is widely remarked as the father of Korean developmentalism, and his closest associates. It shows how the colonial encounter generally, and their service in the Japanese Imperial Army in 1930s Manchuria and Korea in particular, fueled these men's strong desire for Korean independence. The occupation exposed them to Japanese-style statecraft, showing them firsthand how a state could effectively manipulate an economy for nationalistic, industrial transformation purposes. The chapter concludes with an examination of how developmental ideas became a shared way of thinking among the Korean policy elite.

This chapter explains China's contemporary development trajectory. It examines the main features of the post-socialist developmental state (PSDS), as one which fuses the two intellectual streams, that of the concept of the developmental state and that of post-socialist transformation. It is argued that China has become a genus of the PSDS model and that this model provides an explanation for the institutional and policy choices of the state leadership during the time of systemic transformation. The concept of post-socialist developmental state is believed to be a normative model, with transferable lessons for underdeveloped countries in systemic transition. For the post-socialist states it is seen as the logical consequence of transformation, which was not employed due to international pressure. For other underdeveloped countries it is offered as a general developmental guidance, valid particularly now when neo-liberalism has been discredited and the criticism of global capitalism is mounting, and there is indeed some space to be less doctrinaire in an attempt to accelerate development. The chapter starts with the examination of the PSDS features. It then continues with the explanation of China's development as a genus of the PSDS model. Finally it examines the model's broader applicability.

This chapter outlines the book's analytical framework, and sets the stage for the empirical work that follows. It begins with a discussion of the theoretical literature on industrial policy in general, and on work specific to China. It puts the theories in a comparative context, and considers the ways nations such as Japan and South Korea used industrial policy with some success. It considers both positive and negative features of government economic intervention. It also argues that a focus on key economic sectors can shed useful empirical light on the how a government can successfully develop important industries such as telecommunications. It outlines the text's thesis that the rapid growth of telephones and the Internet in China may be attributed to successful government industrial policies.

In this chapter, the politics of development is examined in a comparative perspective, between China and the two largest historical developmental states – Japan and Korea. The examination focuses on several groups of features, i.e. state ideology and institutional and systemic arrangements, including those of political, economic and social character, without, however, insisting on a firm division among them. The stress is on the positioning of the state and its consequences rather than on exhaustive categorisation of the features of respective development trajectories. The chapter begins with the examination of economic nationalism. It then proceeds to the systemic arrangements and state capacity and legitimacy. It continues with the examination of the relations among the main actors of development, including labour relations. It also tackles the phenomenon of corruption. Finally, it discusses state interventionism through economic bureaucracy.

This chapter examines developmental corruption in South Korea and Taiwan, with particular emphasis on the role of corruption in the formation and consolidation of pro-growth “developmental alliances” that linked the ruling party's political interests to the economic interests of big business. During the 1980s, proponents of the “developmental state” model tended to downplay the importance of corruption in East Asia. Chalmers Johnson, for example, acknowledged that extensive “structural corruption” was present in Japan but brushed it aside, arguing that corrupt politicians merely reigned while honest technocrats ruled. This chapter argues that “structural corruption,” also known as “political corruption,” was an integral part of politics, and that “dirty money” bound together and sustained the conservative, pro-business political coalitions found at the core of the so-called developmental state. It also considers structural corruption as a necessary precondition for rapid economic growth.

This chapter discusses the role of civil service in economic growth and development. It also describes how governments improve civil service through changes in personnel management practices, decronyfication, reducing corruption, and improving the quality of service. This chapter also examines civil service in China and Japan. In China, hierarchies ran from individual factories through their sponsoring ministries to the top of government. While the Japanese civil service was never in direct control of industries, it played an important part during the developmental state period. There have been changes in the way in which the civil service is managed in both countries. The two examples show some of the difficulties involved in moving civil service organizations towards a mode of rule that is rational and technocratic and away from one that is based on personal connections and favours.

The Korean state has been a strong state, and with a mission. Despite the dramatic politics unfolding for the last sixty years, the chapter argues that there has been a basic continuity of consensus, throughout both the authoritarian and democratic politics, over a shared mission of modernization, epitomized as industrialization. The chapter seeks to explain how the welfare state in Korea took its form of the developmental state during the period when the Korean state embarked on the national mission. The strong state was highly organized, and power was concentrated in the Presidency. The authoritarian presidents, most notably President Park Chung Hee, took advantage of the state mechanism to stay in power, but also used power effectively in governance to pursue the national mission, by co-opting different social actors, i.e., forces from below, to deliver. The developmental welfare state took its shape in this mixed governance. Within it, the state played the role of regulator. This mixed governance remains in democratic politics.