Modern Economic Development in Japan and China: Developmentalism, Capitalism, and the World Economic System

290 Pages·2013·2.256 MB·English

by  Xiaoming Huang

International Political Economy Series
Series Editor: Timothy M. Shaw, Visiting Professor, University of Massachusetts
Boston, USA and Emeritus Professor, University of London, UK
The global political economy is in flux as a series of cumulative crises impacts its
organization and governance. The IPE series has tracked its development in both
analysis and structure over the last three decades. It has always had a concentra-
tion on the global South. Now the South increasingly challenges the North as the
centre of development, also reflected in a growing number of submissions and
publications on indebted Eurozone economies in Southern Europe.
An indispensable resource for scholars and researchers, the series examines a variety
of capitalisms and connections by focusing on emerging economies, companies
and sectors, debates and policies. It informs diverse policy communities as the
established trans-Atlantic North declines and ‘the rest’, especially the BRICS, rise.
Titles include:
Xiaoming Huang (e ditor )
MODERN ECONOMIC DEVELOPMENT IN JAPAN AND CHINA
Developmentalism, Capitalism and the World Economic System
Bonnie K. Campbell (e ditor )
MODES OF GOVERNANCE AND REVENUE FLOWS OF AFRICAN MINING
Gopinath Pillai ( editor )
THE POLITICAL ECONOMY OF SOUTH ASIAN DIASPORA
Patterns of Socio-Economic Influence
Rachel K. Brickner (e ditor )
MIGRATION, GLOBALIZATION AND THE STATE
Juanita Elias and Samanthi Gunawardana (e ditors )
THE GLOBAL POLITICAL ECONOMY OF THE HOUSEHOLD IN ASIA
Tony Heron
PATHWAYS FROM PREFERENTIAL TRADE
The Politics of Trade Adjustment in Africa, the Caribbean and Pacific
David J. Hornsby
RISK REGULATION, SCIENCE AND INTERESTS IN TRANSATLANTIC TRADE
CONFLICTS
Yang Jiang
CHINA’S POLICYMAKING FOR REGIONAL ECONOMIC COOPERATION
Martin Geiger, Antoine Pécoud ( editors )
DISCIPLINING THE TRANSNATIONAL MOBILITY OF PEOPLE
Michael Breen
THE POLITICS OF IMF LENDING
Laura Carsten Mahrenbach
THE TRADE POLICY OF EMERGING POWERS
Strategic Choices of Brazil and India
Vassilis K. Fouskas and Constantine Dimoulas
GREECE, FINANCIALIZATION AND THE EU
The Political Economy of Debt and Destruction
Hany Besada and Shannon Kindornay (e ditors )
MULTILATERAL DEVELOPMENT COOPERATION IN A CHANGING GLOBAL
ORDER
Caroline Kuzemko
THE ENERGY- SECURITY CLIMATE NEXUS
Hans Löfgren and Owain David Williams ( editors )
THE NEW POLITICAL ECONOMY OF PHARMACEUTICALS
Production, Innnovation and TRIPS in the Global South
Timothy Cadman ( editor )
CLIMATE CHANGE AND GLOBAL POLICY REGIMES
Towards Institutional Legitimacy
Ian Hudson, Mark Hudson and Mara Fridell
FAIR TRADE, SUSTAINABILITY AND SOCIAL CHANGE
Andrés Rivarola Puntigliano and José Briceño-Ruiz ( editors )
RESILIENCE OF REGIONALISM IN LATIN AMERICA AND THE CARIBBEAN
Development and Autonomy
Godfrey Baldacchino ( editor )
THE POLITICAL ECONOMY OF DIVIDED ISLANDS
Unified Geographies, Multiple Polities
Mark Findlay
CONTEMPORARY CHALLENGES IN REGULATING GLOBAL CRISES
Helen Hawthorne
LEAST DEVELOPED COUNTRIES AND THE WTO
Special Treatment in Trade
Nir Kshetri
CYBERCRIME AND CYBERSECURITY IN THE GLOBAL SOUTH
Kristian Stokke and Olle Törnquist (e ditors )
DEMOCRATIZATION IN THE GLOBAL SOUTH
The Importance of Transformative Politics
Jeffrey D. Wilson
GOVERNING GLOBAL PRODUCTION
Resource Networks in the Asia-Pacific Steel Industry
I nternational Political Economy Series
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Modern Economic
Development in
Japan and China
Developmentalism, Capitalism, and the
World Economic System
Edited by
Xiaoming Huang
Victoria University of Wellington, New Zealand
palgrave
macmillan
Editorial matter, selection, introduction and conclusion © Xiaoming Huang
2013
Remaining chapters © Respective authors 2013
Softcover reprint of the hardcover 1st edition 2013 978-1-137-32307-1
All rights reserved. No reproduction, copy or transmission of this
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First published 2013 by
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ISBN 978-1-349-45868-4 ISBN 978-1-137-32308-8 (eBook)
DOI 10.1057/9781137323088
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Contents
List of Illustrations v iii
Notes on Contributors xi
List of Abbreviations xv
1 Modern Economic Development in Time and Place:
Why Japan and China? 1
Xiaoming Huang
2 Mapping Japan and China in the World Economic System 10
Xiaoming Huang
1 Japan and China 11
2 The shaping of modern world capitalism 26
3 Japan, China, and the East Asian model 29
4 Mapping Japan and China in the world economic system 34
3 Dynamic Comparative Advantage and the Evolution of the
Capitalist World System 37
Nobuharu Yokokawa
1 Introduction 37
2 Dynamic comparative advantage 38
3 Minsky’s fi nancial instability hypothesis and
super Minsky cycle 4 6
4 The rise and fall of the golden age and catching-up
industrialization 4 7
5 The structural crisis of bureaucratic capitalism 51
6 Diversifi cation of bureaucratic capitalism 55
7 The fall of the neoliberal capital accumulation regime 61
8 Conclusion 65
4 Neoliberal and Classical Developmentalism: A Comparative
Analysis of the Chinese and Japanese Models of Economic
Development 68
Bai Gao
1 Japan’s classical developmentalism 69
2 China’s neoliberal developmentalism 72
v
vi Contents
3 Comparative analysis of the two development models 75
4 The global conditions of time and place for the classical
and neoliberal development models 84
5 The historical origins of China’s neoliberal
development model 9 1
6 Challenges in transformation of China’s economic model 94
7 Conclusion 97
5 Chinese Developmentalism: Beyond the Japanese Model 98
Marc Lanteigne
1 China considers globalization 98
2 Models for Chinese growth 100
3 China adapts to developmentalism 103
4 Beyond developmentalism: The Beijing consensus 110
5 The challenges ahead for China 114
6 Japan’s FDI and the Development of the Automobile Industry
in China: Firms, Production Structure, and Government 118
Katsuhiro Sasuga
1 Introduction 118
2 The global shift of automobile production 119
3 Chinese automobile industrial policy 122
4 Automobile FDI and the Chinese government 126
5 Japanese automobile FDI and Chinese local government 130
6 The Japanese automobile industry and China’s trade 135
7 Japanese suppliers in the Chinese automobile industry 137
8 Conclusion 141
7 Development Models and External Constraints: From the
Structural Impediments Initiative to Global Imbalances 145
Ben Thirkell-White
1 Global imbalances and the international political
economy of “Asian Capitalism” 1 47
2 Foreign pressure and adjustment in Japan 153
3 China, the United States, and global imbalances 159
4 Conclusion 170
8 Rural–Urban Divide and the Lewisian Turning Point in
Japan and China 172
Katsuji Nakagane
1 Introduction 172
Contents vii
2 The debate on the Lewis turning point 173
3 The turning point in Japan 176
4 China’s performance in terms of rural–urban comparison 181
5 Shaping of the rural–urban divide in China 185
6 Concluding remarks 189
9 T he Forgotten Sector: Institutions, Market Linkages, and
Concurrent Growth in Rural China and Japan 192
J ason Young
1 Introduction 1 92
2 How does agriculture contribute to economic growth? 193
3 Agriculture and the rural economy in China and Japan 197
4 Institutional arrangements underpinning concurrent
growth 2 07
5 Agriculture and the rural economy in comparative
perspective 2 11
10 Beyond Ideological Framing and Structural Description:
Theorizing Japanese and Chinese Economic Models 213
L ei Song and Yanbing Zhang
1 Introduction 2 13
2 The ambiguous “Chinese Model of
Economic Development” 216
3 Theory-building of the Japanese economic model 220
4 Discussion and conclusion 226
11 C onclusion: China and Japan as Instances of Modern
Economic Development 2 30
X iaoming Huang
1 The point of comparison 230
2 Points of comparison 232
3 Findings 2 35
4 Japan and China as instances of the rise and
expansion of the modern world economy 243
Bibliography 247
Index 267
List of Illustrations
Tables
3.1 P eriods of capitalist world systems 4 3
3.2 S hares in Chinese goods trade 6 3
4.1 I nstitutions and mechanisms of Japan’s high-growth
economy 7 1
4.2 I nstitutions and mechanisms of China’s economic growth 73
4.3 S trengths and weaknesses of the two development models 75
4.4 F oreign direct investment as a portion of sales and
profits in the Japanese economy 7 7
4.5 F oreign direct investment as a proportion of the Japanese
economy 7 7
4.6 L evels of economic openness of China and Japan 79
4.7 V iews of world’s most commercially attractive areas 8 0
4.8 F oreign companies in China’s auto industry 82
4.9 C hina’s GDP and GNI 8 3
4.10 T he effect of globalization on two types of
development model 8 5
4.11 G overnment foreign policy change 8 9
4.12 T raditions of China’s foreign economic relations 91
4.13 C hallenges in transformation of the two development
models 9 5
6.1 A utomobile companies ranked by production 1 21
6.2 M ajor markets for the Japanese big three 134
8.1 E ngel coefficients in Japan 1 79
8.2 H oldings of electric appliances in Japan 180
8.3 I nfant mortality rates in Japan 1 80
8.4 P rotein intake by Japanese households 181
8.5 S hare of primary industry in Japan 181
8.6 E ngel coefficients in China 1 83
8.7 H oldings of electric appliances in China 184
8.8 I nfant mortality rates in China 1 85
8.9 S hare of primary industry in China 185
9.1 O rigins of Chinese institutional dualism 209
viii
List of Illustrations ix
Figures
2.1 Real GDP and GDP per capita growth: Japan and China 14
2.2 Institutions of market economy: China and Japan 16
2.3 Institutions of market economy: China and
Japan – size of government 17
2.4 Institutions of market economy: China and Japan – legal
structure 1 7
2.5 Institutions of market economy: China and Japan – access
to good money 1 8
2.6 Institutions of market economy: China and
Japan – freedom to trade internationally 18
2.7 Institutions of market economy: China and
Japan – regulation of credit, labor, and business 19
2.8 Labor productivity: Japan and China 20
2.9 Gross capital formation: Japan and China 20
2.10 FDI net outflows as % of GDP: Japan and China 21
2.11 FDI net inflows as % of GDP: Japan and China 21
2.12 Agriculture, value added as % of GDP: Japan and China 22
2.13 Manufacturing, value added as % of GDP: Japan and China 23
2.14 Services, value added as % of GDP: Japan and China 2 3
2.15 Trade as % of GDP: Japan and China 24
2.16 Government effectiveness: Japan and China 25
2.17 Regulatory quality: Japan and China 26
2.18 Voice and accountability: Japan and China 26
2.19 Political stability and no violence: Japan and China 27
2.20 Rule of law: Japan and China 27
2.21 Control of corruption: Japan and China 28
2.22 Real GDP and GDP per capita growth:
Japan, China, and Europe 28
2.23 Real GDP growth: Japan, China, Asia 30
2.24 Level of marketization and quality of market institutions:
Japan and China 31
2.25 Voice and accountability: Japan and China 31
2.26 Political stability and no violence: Japan and China 32
2.27 Government effectiveness: Japan and China 32
2.28 Regulatory quality: Japan and China 33
2 .29 Rule of law: Japan and China 33
2.30 Control of corruption: Japan and China 34
3.1 Dynamic industries and VAL 39
3.2 Basic Minsky cycle 4 6