Taiwanese Development Model

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 ezdards 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 assiezce. 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.