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Manufacturing Miracles

Manufacturing Miracles: Paths of Industrialization in Latin America and East Asia

Gary Gereffi
Donald L. Wyman
Copyright Date: 1990
Pages: 432
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  • Book Info
    Manufacturing Miracles
    Book Description:

    Few observers of Mexico and Brazil in the 1930s, or South Korea and Taiwan in the mid-1950s, would have predicted that these nations would become economic "miracles" several decades later. These newly industrializing countries (NICs) challenge much of our conventional wisdom about economic development and raise important questions about international competitiveness and export success in manufacturing industries. In this volume economists, sociologists, and political scientists seek to explain the growth of the NICs in Latin America and East Asia and to reformulate contemporary development theory through an in-depth analysis of these two dynamic regions. Gary Gereffi and Colin I. Bradford, Jr., provide an overview of national development trajectories in Latin America and East Asia, while Barbara Stallings, Gereffi, Robert R. Kaufman, Tun-jen Cheng, and Frederic C. Deyo discuss the role of foreign capital, governments, and domestic coalitions in shaping development outcomes. Gustav Ranis, Robert Wade, Chi Schive, and Ren Villarreal look at the impact of economic policies on industrial performance, and Fernando Fajnzylber, Ronald Dore, and Christopher Ellison with Gereffi examine new agendas for comparative development research.

    Originally published in 1990.

    ThePrinceton Legacy Libraryuses the latest print-on-demand technology to again make available previously out-of-print books from the distinguished backlist of Princeton University Press. These paperback editions preserve the original texts of these important books while presenting them in durable paperback editions. The goal of the Princeton Legacy Library is to vastly increase access to the rich scholarly heritage found in the thousands of books published by Princeton University Press since its founding in 1905.

    eISBN: 978-1-4008-6203-0
    Subjects: Economics, Business

Table of Contents

  1. Front Matter
    (pp. i-vi)
  2. Table of Contents
    (pp. vii-viii)
  3. List of Figures and Tables
    (pp. ix-xii)
  4. Preface
    (pp. xiii-xvi)
    Gary Gereffi
  5. Part One: A Cross-Regional Overview of National Development Trajectories

    • CHAPTER 1 Paths of Industrialization: An Overview
      (pp. 3-31)
      Gary Gereffi

      Industrialization has been the hallmark of national development in the twentieth century. Development studies in a variety of disciplines have focused on the determinants and consequences of the domestic changes that take place as agricultural and natural-resource-based societies have moved into the industrial world. The process of industrialization, although rooted in national societies, is also a global phenomenon, and it is shaped by the dynamics of the world-system.

      The United States rose to a position of unparalleled economic and political dominance in the two decades after World War II. The postwar economic expansion of the United States was fueled by...

    • CHAPTER 2 Policy Interventions and Markets: Development Strategy Typologies and Policy Options
      (pp. 32-52)
      Colin I. Bradford Jr.

      The purpose of this chapter is to explore different types of development strategies over time and between countries to better understand the most effective means of achieving dynamic development. Three major dimensions are of interest: the relationship between the relative roles of the state and the private sector, the interaction between external conditions and economic policies and patterns, and the evolution and sequence of dominant policy regimes in dynamic economies over time. The paper will compare economic policies, patterns, and performance of South Korea, Taiwan, Brazil, and Mexico from 1966 to 1984.

      This analysis seeks to increase the range of...

  6. Part Two: Key Economic, Political, and Social Dimensions of Development in the Latin American and East Asian NICs

    • CHAPTER 3 The Role of Foreign Capital in Economic Development
      (pp. 55-89)
      Barbara Stallings

      One of the most controversial topics in development theory and policy has been the role of foreign capital. Looking back over the post–World War II era—the period in which governments actually began to devise development policies and strategies in the Third World—debates on the advantages and disadvantages of foreign resources have often been at center stage. Is foreign capital the principal vehicle for the promotion of development or the central cause of underdevelopment? Do Third World governments have any bargaining leverage with multinational firms, or do the latter simply impose conditions? What are the relative advantages of...

    • CHAPTER 4 Big Business and the State
      (pp. 90-109)
      Gary Gereffi

      The Latin American and East Asian newly industrializing countries (nics) frequently have been taken to represent two contrasting development orientations: Mexico, Brazil, and Argentina are seen as having given primacy to an inward-oriented (import-substituting) mode of development, while Taiwan, South Korea, Hong Kong, and Singapore are associated with an outward-oriented (export-promoting) model. While these regional contrasts help us to understand many features of Latin American and East Asian development, national diversity among the nics often overshadows regional similarities.

      One form of subregional variation that tends to have been ignored in previous studies is industrial structure. There are two sets of...

    • CHAPTER 5 How Societies Change Developmental Models or Keep Them: Reflections on the Latin American Experience in the 1930s and the Postwar World
      (pp. 110-138)
      Robert R. Kaufman

      Ever since the societies of Latin America began to expand their role as exporters of primary products in the late nineteenth century, issues related to inward- and outward-oriented models of development have been an important feature of that region’s political life. This chapter examines two turning points in the conflicts surrounding these models: (1) the Depression and early 1940s, a watershed period in the acceleration of import-substituting industrialization (isi), and (2) the first several decades after the end of World War II, from 1945 to the 1960s, a time in which isi objectives were articulated as explicit components of state...

    • CHAPTER 6 Political Regimes and Development Strategies: South Korea and Taiwan
      (pp. 139-178)
      Tun-jen Cheng

      The “East Asian model” is not of a piece. Despite many commonalities among the East Asian newly industrializing countries or nics (Deyo, 1987), it is important to understand the variations within them. This chapter identifies differences between two major nics in East Asia, South Korea and Taiwan, with respect to their developmental processes. It seeks to demonstrate that the distinct patterns of development are fundamentally shaped by regime dynamics. Three questions are central in this essentially political analysis: First, how were developmental transitions made? Second, how were developmental strategies executed? And finally, in each case how did the sociopolitical consequences...

    • CHAPTER 7 Economic Policy and the Popular Sector
      (pp. 179-204)
      Frederic C. Deyo

      It is generally assumed that workers, peasants, middle classes, and other popular sector groups play little direct role in the formulation of national development strategies, even under democratic regimes (see Remmer and Merkx, 1982; Canak, 1984). The constraints and possibilities presented by the interests and capacities of developmental states, dominant social classes, foreign capital, and the military have tended to dominate discussion of strategy-making and the political economy of growth.

      While elite policies are rooted in more general developmental strategies or doctrines, the determination of strategies has rarely engaged nonelite groups. On the other hand, to the extent policy measures...

  7. Part Three: Development Strategies:: Do They Make a Difference?

    • CHAPTER 8 Contrasts in the Political Economy of Development Policy Change
      (pp. 207-230)
      Gustav Ranis

      Much recent literature has focused on an assessment of the development effort in the developing countries attempting a transition from agrarianism to modern growth as described by Simon Kuznets (1966). Most of this work has focused on a variety of sectoral and aggregative dimensions of performance, including “bottom line” indices implying success or failure in reaching basic development objectives. While Kuznets was himself more concerned with describing the attributes of “modern growth” than with the transition effort, others have tried to examine deviations from the “normal” structure in terms of initial conditions and subsequent man-made organizational or policy choices. Kuznets...

    • CHAPTER 9 Industrial Policy in East Asia: Does It Lead or Follow the Market?
      (pp. 231-266)
      Robert Wade

      Within the space of less than thirty years, Taiwan and South Korea have jumped so far up the economic hierarchy of nations as to become competitive in a range of capital-intensive and high-technology industries. Taiwan moved from the world’s sixty-fourth biggest exporter in 1962 to eleventh in 1986, South Korea from 101st in 1962 to fourteenth in 1986.¹ This export performance occurred at the same time that they were undergoing the most “compressed” transformation from light to heavy industries that the noncommunist world has ever seen. Their ratio of value added in light industries over heavy industries fell from 4...

    • CHAPTER 10 The Next Stage of Industrialization in Taiwan and South Korea
      (pp. 267-291)
      Chi Schive

      The export-led growth of four Asian newly industrializing countries (nics), Taiwan, South Korea, Singapore, and Hong Kong, is well documented (Galenson, 1985; Lau, 1986; Bradford and Branson, 1987). Of these four, Taiwan and South Korea have received the most attention because of their rapid, large-scale industrializations. Export-led economic growth raises two problems. First, what changes occur in the domestic sector of a nic to produce and replace the materials and equipment originally imported to facilitate exports? Second, when conventional exports (such as textiles, footwear, and steel) begin to face increasing difficulties in the world market—low-cost competition from less developed...

    • CHAPTER 11 The Latin American Strategy of Import Substitution: Failure or Paradigm for the Region?
      (pp. 292-320)
      René Villarreal

      From the 1950s until the beginning of the 1980s, Latin American countries maintained high rates of economic growth that provided the basis for making far-reaching economic and social changes. Nonetheless this process was accompanied by the recurrent problems of external disequilibrium (balance of payments difficulties) and internal disequilibrium (inflation and disparities in the distribution of income).

      This pattern of economic growth in Latin America was perceived as quite acceptable by academics and institutions in the developed countries. In fact, during the 1970s diverse studies were carried out and projections made that tried to find alternative ways to accelerate such growth,...

  8. Part Four: Emerging Agendas for Comparative Development Research

    • CHAPTER 12 The United States and Japan as Models of Industrialization
      (pp. 323-352)
      Fernando Fajnzylber

      The main purpose of this chapter is to engage in critical reflection on regional development experiences and on current debates regarding industrialization options and development strategies. As a modest contribution toward this end, the chapter analyzes the development experiences of three Latin American countries—Argentina, Brazil, and Mexico¹—and one East Asian case, South Korea. The primary objective here is to identify sets of structural features that comprise distinctive regionalpatternsof development.

      It is important at the outset to clarify the notion of “patterns of development” and to distinguish it from that of “development strategies.” The former concept assumes...

    • CHAPTER 13 Reflections on Culture and Social Change
      (pp. 353-367)
      Ronald Dore

      These "reflections" began at a conference at which the papers in this volume were presented. It was supposed to be the usual final-session attempt to summarize the state of play, highlight the important insights, and send everybody home with a glow of satisfaction and achievement. Even then it wandered seriously from that task. Now, however, that the task has been so competently performed by Gary Gereffi in his introduction (chap. 1, this volume), I feel rather better entitled than I was then to add a few ideas by way of highly selective commentary on the issues discussed.

      I begin with...

    • CHAPTER 14 Explaining Strategies and Patterns of Industrial Development
      (pp. 368-404)
      Christopher Ellison and Gary Gereffi

      The paths of industrialization followed by the Latin American and East Asian nics have been shaped by a diverse array of international and domestic forces. This volume offers a number of conclusions about how the strategies and patterns of industrial development have evolved in response to initial factor endowments, historical events, external shocks, political choices, the interplay of domestic interest groups, and available economic ideas and cultural traditions in each of these societies. These interpretations not only advance our understanding of industrial processes in the cross-regional set of societies in question, but they also suggest new directions for future comparative...

  9. Contributors
    (pp. 405-406)
  10. Index
    (pp. 407-416)