| Abstract: | This article examines the main ingredients of the East Asiansuccess story in each subphase of its post-war transition growthprocess. It focuses mainly on Taiwan (China), with comparativeside glances at the Republic of Korea. The initial conditionsfacing the region were favorable, especially in Taiwan (China).The early import substitution subphase was unusually mild andcontributed to the emergence of strong linkages between agriculturaland nonagricultural activities. Subsequently, flexible labormarkets, human capital policies, and major macro and structuralpolicy reforms culminated in an increasingly export-orientedindustrialization effort. Once labor surpluses were ultimatelyexhausted, government policies accommodated Taiwan (China)'sentry into the technological era of the 1970s and 1980s. Duringthe past four decades of a signally successful transition growtheffort, public policies in East Asia have consistently accommodatedthe changing needs of the economy, rather than guide its pathdirectly. |
