Joe Studwell

Overview

  How Asia Works: Success and Failure in the World's Most Dynamic Region, written by Joe Studwell, explores the economic development of East Asia and the factors that contributed to the region's rapid growth. Studwell provides a critical analysis of the policies implemented by three countries: Japan, South Korea, and Taiwan, contrasting their success with the failures of the Philippines, Malaysia, and Thailand. By examining these nations, Studwell aims to debunk the prevailing narrative of free markets and neoliberal policies as the sole drivers of development.

  Joe Studwell, an award-winning writer and journalist, has spent many years studying and reporting on Asia's economies. In How Asia Works, he draws on extensive research and first-hand interviews to provide a nuanced understanding of the processes that led to Asia's economic transformation.

Key Points / Ideas

  Studwell's central argument is that state-led economic development, rather than free markets or neoliberal policies, is the key to unlocking sustained and equitable growth. He highlights four main components that underpinned the success of East Asian economies:

  1. Land reform: Studwell emphasizes that equitable access to land is crucial for agricultural development. By redistributing land to smallholder farmers, East Asian countries enabled them to increase productivity, generating a surplus that could be reinvested elsewhere in the economy.

  2. Export-oriented industrialization: The second pillar of East Asia's success is export-oriented industrialization. By focusing on manufacturing goods for export, governments ensured a steady inflow of foreign currency and technology transfer. Studwell argues that this strategy allowed these nations to develop industries and gain a competitive advantage in global markets.

  3. Financial repression: Studwell claims that government intervention in the financial sector, through strict regulations and directed lending, was key to ensuring that surpluses generated from land reform and industrialization were channeled towards productive investments. This approach often involved low interest rates and favoring state-owned enterprises over private ones.

  4. A focus on human capital: Finally, Studwell highlights the importance of investing in education and training. East Asian countries prioritized developing a skilled workforce, creating a competitive advantage in high-value industries.

  Studwell supports his arguments with extensive evidence and case studies. For example, he compares the success of Taiwan's land reform policies with the failures of the Philippines, where land concentration hindered agricultural productivity and equitable development. Similarly, Studwell contrasts the successful exports from Japan, South Korea, and Taiwan with the protectionist policies and weak industrialization efforts of Malaysia and Thailand.

Conclusion

  How Asia Works by Joe Studwell offers a compelling analysis of the economic development of East Asia. The book challenges the widely-held belief that unfettered free markets alone drive growth, instead emphasizing the role of state-led intervention. Through his examination of Japan, South Korea, Taiwan, the Philippines, Malaysia, and Thailand, Studwell demonstrates that successful economic development requires a combination of land reform, export-oriented industrialization, financial repression, and investment in human capital.

  Readers interested in understanding the economic development of East Asia and the role of state intervention will find How Asia Works to be an invaluable resource. Studwell's research, case studies, and thought-provoking analysis shed light on the policies and strategies that transformed East Asian economies from struggling nations into global powerhouses.

  For further reading, individuals can explore other books on the topic, such as "Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism" by Ha-Joon Chang and "Kicking Away the Ladder: Development Strategy in Historical Perspective" by Ha-Joon Chang. These books provide additional insights into the role of state intervention in economic development and offer alternative perspectives on global trade and inequality.