Model, Myth, or Miracle?: Reassessing the Role of Governments in the East Asian Experience (Unu Policy Perspectives)

Annotation Before the financial crisis of the late 1990s, the East Asian experience was hailed as a miracle and a model of successful development. A broad consensus had been reached on the role of governments in engineering this economic success, and rapid growth was generally attributed to sound policies that were underpinned by a solid institutional framework. In the aftermath of the financial crisis, however, the "miracle" has been dismissed as a myth and a bad example that other countries should avoid. Critics allege that governments not only made serious policy mistakes, but also that the institutional framework was not so beneficial after all. The term "crony capitalism" is frequently used to summarize this notion. This book investigates the role that institutional conditions played in the miracle, and whether they had a part in causing the crisis. The focus is on such factors as the close ties between the public and private sectors, the incentives structures within the public sector, and corruption. Empirical tests show that these factors can indeed contribute to explaining differences in economic growth. The data also show that the notion of distinctive East Asian experience is misguided because there were always large differences in institutional conditions among the miracle economies. Scorecards of institutional performance are presented for Thailand, Malaysia, South Korea, Singapore, and Hong Kong The volume ends with a detailed discussion of the role of corruption. The author concludes that, contrary to popular belief, there is no evidence of corruption having cased the crisis Before The Financial Crisis Of The Late 1990s, The East Asian Experience Was Hailed As A Miracle And A Model Of Successful Development. A Broad Consensus Had Been Reached On The Role Of Governments In Engineering This Economic Success, And Rapid Growth Was Generally Attributed To Sound Policies That Were Underpinned By A Solid Institutional Framework. In The Aftermath Of The Financial Crisis, However, The Miracle Has Been Dismissed As A Myth And A Bad Example That Other Countries Should Avoid. Critics Allege That Governments Not Only Made Serious Policy Mistakes, But Also That The Institutional Framework Was Not So Beneficial After All. The Term Crony Capitalism Is Frequently Used To Summarize This Notion. This Book Investigates The Role That Institutional Conditions Played In The Miracle, And Whether They Had A Part In Causing The Crisis. The Focus Is On Such Factors As The Close Ties Between The Public And Private Sectors, The Incentives Structures Within The Public Sector, And Corruption.--jacket. 1. The Role Of Government Performance In East Asia -- 1. Public-private Cooperation -- 2. The Bureaucracy -- 3. Rule Of Law -- 4. Corruption -- 5. Political Stability -- 2. Measuring The Quality Of Government Performance -- 1. How To Measure Quality -- 2. Main Data Sources -- 3. Indicators -- 4. Empirical Strategy -- 5. Limitations Of Subjective Indicators -- 3. Government Performance And Growth: What The Data Say -- 1. Public-private Cooperation -- 2. The Bureaucracy -- 3. Rule Of Law -- 4. Low Levels Of Corruption -- 5. Political System And Political Instability -- 6. Summary Of Results -- 4. Scorecards For East Asian Countries -- 1. The Scorecard -- 2. Scores For Thailand -- 3. Scores For Malaysia -- 4. Scores For South Korea -- 5. Scores For Singapore -- 6. Scores For Hong Kong -- 7. Growth In Two City-states: Hong Kong And Singapore -- 8. Expectations Of Future Developments -- 9. Overall Rankings -- 5. Causes And Consequences Of Corruption -- 1. Consequences Of Corruption: A Second Look -- 2. Types Of Corruption -- 3. Causes Of Corruption: A Review Of The Literature -- 4. Causes Of Corruption: The Empirical Evidence -- 5. Crony Capitalism And Corruption -- 6. Did Corruption Cause The Asian Financial Crisis? -- Ii. Results Of Extended Growth Regressions -- Iii. Country Coverage In The Three Main Data Sets -- Iv. Country Rankings -- V. Corruption And Crony Capitalism Beatrice Weder. Includes Bibliographical References (p. [155]-161) And Index. Before the financial crisis of the late 1990s, the East Asian experience was hailed as a miracle and a model of successful development. A broad consensus had been reached on the role of governments in engineering this economic success, and rapid growth was generally attributed to sound policies that were underpinned by a solid institutional framework.In the aftermath of the financial crisis, however, the "miracle" has been dismissed as a myth and a bad example that other countries should avoid. Critics allege that governments not only made serious policy mistakes, but also that the institutional framework was not so beneficial after all. The term "crony capitalism" is frequently used to summarize this notion. This book investigates the role that institutional conditions played in the miracle, and whether they had a part in causing the crisis. The focus is on such factors as the close ties between the public and private sectors, the incentives structures within the public sector, and corruption.Empirical tests show that these factors can indeed contribute to explaining differences in economic growth. The data also show that the notion of distinctive East Asian experience is misguided because there were always large differences in institutional conditions among the miracle economies. Scorecards of institutional performance are presented for Thailand, Malaysia, South Korea, Singapore, and Hong KongThe volume ends with a detailed discussion of the role of corruption. The author concludes that, contrary to popular belief, there is no evidence of corruption having cased the crisis. -- Provided by publisher