Beyond Late Development: Taiwan's Upgrading Policies(The MIT Press)

In this book, the authors analyze the phenomenon of high-end catch-up. They study how leading firms from the most advanced latecomer countries like Taiwan have increased their market share in mature high-tech industries and services. The profits that true innovators in these industries once enjoyed have already declined, but profit rates are still above average. The latecomer firm that succeeds in capturing these rents earns "second mover" advantage. Amsden and Chu examine the successful second mover in electronics and modern services. The critical factors, they show, are the government policies and large-scale firms that drive skills, speed, and scale. R&D in Taiwan was usually undertaken in conjunction with government labs, which prepared the way for local production of the next hot, mature product. Speed in ramping up at the firm level depended on project execution capabilities and access to capital. Scale proved to be an absolute entry requirement in modern service sectors, and was crucial to win sub-contracts from leading foreign firms and to secure key components from world-class suppliers in the electronics industry.

About the Author :
Alice H. Amsden is Barton T. Weller Professor of Political Economy in the Department of Urban Studies and Planning at the Massachusetts Institute of Technology. Wan-wen Chu is Research Fellow and Deputy Director at the Sun Yat-Sen Institute for Social Sciences and Philosophy (ISSP), Academia Sinica in Taiwan.

Review :
"Amsden and Chu demonstrate in a scholarly and readable way how successful latecomers deviate from the prescriptions of the 'Washington consensus' in order to build high-tech industries and services. This is a pathbreaking book that points the way toward a new analysis and policy regime for catching up."--Joseph E. Stiglitz, Professor of Economics and Finance, Columbia University, Nobel Laureate in Economics (2001) "Out of a detailed case study of Taiwan, Amsden and Chu construct a complex, far-reaching argument about the role of business strategy and governmental policy in late development. Built on a firm foundation of economic and institutional theory and grounded in field interviews with business and bureaucratic actors, it is a strong antidote to neo-liberalism and the belief in economic development as a natural outcome of the free play of market forces. This is one of those rare books which speaks simultaneously to scholars and to practitioners." Michael J. Piore, David W. Skinner Professor of Political Economy, MIT "American Economic Policy in the 1990s sets the standard for timely yet rigorous analysis of economic policy. The volume's breadth and quality will make it the comprehensive reference on the events of -- and lessons to be learned from -- the 1990s. As an economist and as a policymaker, I highly recommend it." -- Joseph E. Stiglitz, 2001 Nobel Laureate in Economics,former Chairman of the Council of Economic Advisers, and former ChiefEconomist of the World Bank--Joseph E. Stiglitz, Professor of Economics and Finance, Columbia University, Nobel Laureate in Economics (2001) "*Beyond Late Development* successfully challenges long-held orthodoxies such as the domination of the Taiwanese economy by small firms, the necessity of foreign ownership in a globalized world, and the reduced role of governments in industrial upgrading. It is an original work of detailed empirical research."--Raphael Kaplinsky, Fellow, Institute of Development Studies, University of Sussex "Out of a detailed case study of Taiwan Amsden and Chu construct a complex, far-reaching argument about the role of business strategy and governmental policy in late development. Built on a firm foundation of economic and institutional theory and grounded in field interviews with business and bureaucratic actors, it is a strong antidote to neo-liberalism and the belief in economic development as a natural outcome of the free play of market forces. This is one of those rare books which speaks simultaneously to scholars and to practitioners."--Michael J. Piore, David W. Skinner Professor of Political Economy, MIT "A great place to learn how and why microfinance really works, and where it hits its limits. The book, written by two leading young economists, brims with new evidence and provides fresh perspectives on old debates. Clearly written and sharply argued, it revisits and transforms important ideas about poverty reduction, finance, and incentives. The authors describe what we know and what we need to know in order to move forward."--Joseph E. Stiglitz, Professor of Economics and Finance, Columbia University, Nobel Laureate in Economics (2001)