Trading Companies in South Korea and Taiwan

If Keynes is responsible for popularizing fiscal policy as the essential companion to monetary policy in the retinue of a government's tools for intervening in the economy, the experience of the late developing countries and the globalization of economic competition have assured industrial policy its place alongside the other two. Industrial policy is not new, however, nor are the late developing nations its exclusive employers. Pointing out that the Japanese actually learned of the notion from the West, Chalmers Johnson cites Alexander Hamilton's Report on Manufactures written in 1791: Capital is wayward and timid in lending itself to new undertakings, and the State ought to excite the confidence of capitalists, who are ever cautious and sagacious, by aiding them overcome the obstacles that lie in the way of all experiments.' While the caution and sagacity of capitalists have perhaps changed little in the 200 years since Hamilton wrote, the obstacles are arguably greater, thus underscoring the perceived need by many, if not most governments to be concerned with the competitiveness and organization of their nations' industries. This article examines one such effort of industrial or, more accurately, commercial policy in two specific environments: the political economies of South Korea and Taiwan. Witnessing the success of Japan's version of the so-called general trading company, the Korean and Taiwan governments launched their own versions with great fanfare and expecta

Business · Economic system · Economics · Asian Industrial and Economic Development

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