User:Cmcarlson/sandbox

title

Incentive for capitalists to resist state planning;

In order to carry out industrial planning, states needed to build the necessary state institutions, such as a Planning Commission, to formulate production targets and later enforce them. But since ISI industries were protected from international competition, capitalists were not compelled by the market to meet international standards of efficiency. This meant that capitalists often resisted state efforts to enforce industrial plans and force investments in improving productivity. In India, for example, Vivek Chibber has shown that efforts by the state to put in place the proper institutional framework for state planning was strongly resisted by Indian capitalists. This resulted in an ineffective state apparatus that was incapable of carrying out coherent industrial planning. Under export-led industrialization in South Korea, on the other hand, there was a positive incentive for capitalists to comply with state planning because international competition on world markets would compel capitalists to upgrade production to international standards. This allowed for a different relationship between the state and private sector, and more successful state planning.

EOI has often been supported as a development strategy for poor countries because of its success in the Asian Tigers. However, this claim has been challenged by the evidence of very specific historical conditions in East Asia that were not present elsewhere, and which allowed for the success of EOI in these nations. Japanese producers, for example, were given preferential access to US and European markets after the Second World War. This, in turn, made it possible for countries like South Korea and Taiwan to later become incorporated into Japan’s overseas marketing networks as Japanese trading conglomerates were seeking to offload the lower end of their manufacturing value chain to other countries. By virtue of this connection to Japanese commercial networks, South Korean firms had ‘access to export markets that virtually no other country—except Taiwan—enjoyed’. Without these advantages, it is doubtful that EOI could be as successful in other countries as it was in East Asia.

This is the text and now I need a link