Chapter 11.5, Problem 1RQ

To determine

The way in which the process of economic development been similar and different in Japan, South Korea, Taiwan, and China since the end of World War II.

Answer to Problem 1RQ

In all the capitalist-oriented countries of East Asia, various policies and actions are taken to develop their country in terms of economy. However, in the case of China, which ruled by communist inspired political system, the growth was unevenly distributed.

Explanation of Solution

In the 1960s, 1970s, and 1980s, Japan was the pacesetter of the world economy. However, in the early 1990s, the Japanese economy experienced a major setback and the growth has remained slow ever since. In spite of all its recent problems, they are the third largest economic power in the world. The beginning of the Japanese “economic miracle” occurs on the 1950s. After the decline of the Japanese empire, they forced to export the manufactured products from the inexpensive consumer goods to sophisticated products including automobiles, cameras, electronics, machine tools, and computer equipment. Japan grew as the leader in many segments of the global high tech economy by the 1980s.

The inflated real estate market of Japan collapsed on the early 1990s and it leads to a banking crisis. Many of the Japanese companies relocated their factories to Southeast Asia and China at this time. As a result, the economy of Japan stagnated for years. The massive and continuous spending of the state funds, through which the Japanese Government attempted to strengthen its economy, in reality, gave rise to huge deficits. In spite of all these economic problems, Japan remained as a core country of the global economic system.

The former colonies of Japan such as South Korea and Taiwan followed the path of Japan to develop. The South Korean government initiated a program of export-led economic growth. It guides the economy with a heavy hand and denied basic political freedom to the Korean people. Such policies became highly successful in the economic realm by 1970s. Since the 1960s, Taiwan experienced rapid economic growth. During the early phase of industrial expansion, the government of Taiwan guided the economic development of the country.

In both physical size and population, China surpasses all other countries in East Asia. As a result, the economic take-off of China reshaped the economy of the entire world. China experienced two economic disasters in the late 1950s and 1960s. It is ironically called the “Great Leap Forward”. It depends on the idea that small-scale village workshops could manufacture large quantities of iron needed for sustained industrial growth.