Taiwanese Development Model Since 1960 Essay, Research Paper

The Taiwanese Development Model Since 1960

According to Thomas Gold Taiwan offers a text book case of an elite-led

revolution leading to social transformation. The stability of hard

authoritarianism of the Taiwanese government laid the groundwork for Taiwanese

development. The KMT’s cohesiveness and political domination plus the economic

development aid supplied by the United States also helped to provide good

conditions for Taiwanese growth in the beginning. Once the KMT gained control of

Taiwan they redistributed the land and launched a program of rehabilitation and

industrialization. This period was responsible for the nationalization of many

businesses formerly owned by the Japanese and the start of industrial production

in Taiwan marked by a shift away from agriculture to industry. During the early

period of industrialization Taiwan tried to create domestic markets for its

goods. During the period from 1960 to 1973 Taiwan pursued export expansion in

the area of industrial goods. During this period U.S. aid directed at Taiwan

declined as did the islands geopolitical significance. To make up for this

decline Taiwan focused on increasing its exports. The growth of the Taiwanese

economy during this period according to Gold laid the ground work for the growth

of opposition movements and loosening of the KMT”S grip on power. According to

Gold this was because the changes in the Taiwanese economy brought about a

middle class, a better educated populace, and a dispersion of industry through

out the country. The Period from 1973 to 1984 Gold calls the time of industrial

upgrading and the emergence of a political opposition. During this period Taiwan

faced the oil shock, and increase in export prices due to a labor shortage that

doubled workers salaries, a further loss of geopolitical prestige, and the

growth of dissent and political opposition. Taiwan industrially during this time

improved the quality and quantity of its exports.

The Taiwan industrial model was that of a elite run bureaucracy that

tightly controlled its nations citizenry in authoritarian ways. This

authoritarian government was able to effectively channel the energies of Taiwan

toward modernization. This authoritarian government became a victim of its own

success because as living and education standards rose the citizenry demanded a

shift away from hard authoritarianism.

Taiwan is not a very good industrialization model for other countries

to use outside of East Asia. This is because many of the factors that allowed

Taiwanese industrialization were unique to Taiwan. First, Taiwan was colonized

before 1950 by a developmentalist power, Japan to which is had close ties even

after 1950. Second, Taiwan was the recipient of financial aid during its

critical early years because of a inter-core competition for hegemony between

China and the United States. Third, Taiwan benefited by having a implacable foe

with a very different vision of development. Fourth, Taiwan was given breathing

space following 1949, this enabled Taiwan to revive production and consolidate

power without foreign powers interfering. All these factor make Taiwan unique

from other nations that would try to copy it. One of the elements that nations

should not copy from the Taiwan Model according to Gold is Taiwan’s harsh

authoritarian government which was much too strictly authoritarian and had a

hard time changing as the attitudes of the Taiwanese people changed. (Gold’s

book was published years before the 1996 democratic elections in Taiwan) But

Gold does say that Taiwan’s development model does have some lessons that could

be copied in other nations seeking to industrialize. These are a official

commitment to development, land redistribution, fostering of agriculture,

creation of extra-ministerial ministries to guide development, strategic credit

allocation, collection and efficient management of data concerning the economy,

investment in infrastructure and human capital, and proper allocation of foreign

assistance. Taiwan’s development model was a combination of an orwellian state

and effective ways of industrializing. Taken as a whole the repressiveness of

the Taiwanese model makes it undesirable for government to adopt; but other

aspects of Taiwan’s industrial policy could prove effective for countries

outside of the pacific rim.