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2016 | Book

Introduction: Varieties and Alternatives of Catching Up: Asian Development in the Context of the Twenty-First Century Read chapter Read first chapter

Varieties and Alternatives of Catching-up

Asian Development in the Context of the 21st Century

Editors: Yukihito Sato, Hajime Sato

Publisher: Palgrave Macmillan UK

Book Series : IDE-JETRO Series

Part of: Springer Professional "Wirtschaft+Technik" , Springer Professional "Technik" , Springer Professional "Wirtschaft"

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About this book

This book sheds new light on the advancement of various industries in developing Asian countries through an application and re-examination of catch-up industrialization theory. With contributors presenting their own perspectives on the progression of a range of different industries in Asia, this volume provokes readers to reconsider their current understanding of industrialization in latecomer countries. More specifically, the chapters discuss Taiwan's semiconductor industry, Korea's steel industry, and Malaysia's palm oil industry, amongst others. The authors also explore the 'catch-down' innovation strategy in China and India. Varieties and Alternatives of Catching-up provides a thorough analysis of the strategies employed by numerous Asian countries to radically transform their low-income agricultural economies to middle-income industrialized ones. This book is essential reading for researchers and scholars interested in Asian economic development.

Table of Contents

Frontmatter
1. Introduction: Varieties and Alternatives of Catching Up: Asian Development in the Context of the Twenty-First Century
Abstract
This introductory chapter offers an overview of this volume, including a literature review on catch-up industrialization and a summary of the nine chapters. It clarifies that the ultimate objective of the volume is to reconsider the theory of catch-up industrialization by examining various industries in Asia, especially changes in their development patterns over the last two decades. To this end, three tasks are identified for the volume: the first is to closely examine the latter stages of the catching-up process; the second is to analyze the relationships between catch-up industrialization and other development mechanisms, particularly linkage effects; and the third is to highlight other newly emerging mechanisms besides catch-up industrialization that make a significant contribution to development in some latecomer countries.
Yukihito Sato, Hajime Sato
2. Innovations Derived from Backwardness: The Case of Taiwan’s Semiconductor Industry
Abstract
This chapter examines Taiwan’s semiconductor industry as a successful case of catching up. The case shows that its success can be attributed to catching up not only technologically, but also in other nontechnological factors. As for the manufacturing sector of the industry, it was essential for Taiwan to form a pure-play foundry model ahead of advanced countries. The backwardness of Taiwan’s semiconductor industry not only provided an opportunity to create this potentially promising model, but also forced it to choose the model. The design sector of the industry succeeded in capturing potential demand from emerging economies using its unique business model including total solution for the users. The model was created based on its experiences as a latecomer.
Yukihito Sato
3. The Narrow ‘Breadth of R&D’ and the Bottleneck of Technological Catch-Up: A Case Study of Taiwan’s Flat Panel Display Industry from the Perspective of the R&D Strategy of AMOLED
Abstract
This chapter through a case study of Taiwan’s flat panel display (FPD) industry, shows that it is important for industries in developing countries in the final stages of the catching-up process to widen their ‘breadth of R&D’ and improve responsiveness to market needs. In the early 2000s Taiwan’s FPD industry invested considerable resources in developing AMOLED, an advanced type of FPD, in response to increasing marketplace uncertainty. Afterward, however, the lack of a strong brand and a solid alliance with specific major vendors led the industry to focus its R&D on areas with high marketability, which ultimately led to the stagnation and suspension of R&D on AMOLED technology. This weakened the ability of the Taiwanese FPD industry to adapt to the ensuing changes in market structure.
Shingo Ito
4. Industrial Development and Linkage Formation in Korea: A Case Study of the FPD Industry
Abstract
By examining the FPD industry, this chapter explores how South Korea’s pattern of industrial development—once dependent on imported parts and machines—has changed with the transition from a follower to a leader in a leading industry since the 2000s. This chapter shows that backward linkage effects of FPD production spread domestically as Korean FPD firms accumulated technological capabilities and succeeded in catching up with and then surpassing Japanese FPD firms since the mid-2000s. Furthermore, it analyzes how the increased technological capabilities of Korean FPD firms led to Korean suppliers growing and upgrading their capabilities. The transition of Korean FPD firms to leading positions contributed to the increase in demand for FPD components, materials, and equipment industries.
Hidemi Yoshioka
5. The Catch-Up Process in the Korean Steel Industry
Abstract
This chapter examines how South Korea’s steel industry caught up with the Japanese steel industry technologically by focusing on the relationship between the phases of innovation, the speed of technological catch-up, and institutions. Two large waves of innovation occurred in the industry after World War II. Korean steel companies succeeded in accelerating the catching-up process by concentrating their investment at specific phases of each innovation cycle. In the first wave of innovation, South Korea concentrated its investment on the construction of integrated steelworks by establishing the state-owned monopoly firm, POSCO. In the second wave, the market entry of Hyundai Motor Group through vertical integration and POSCO’s countermeasure allowed for developing high-quality steel sheets, which further pushed forward the catching-up.
Makoto Abe
6. Advantages of Backwardness and Linkage Effects: The Steel Industry in Asia
Abstract
This chapter looks at the steel industries in several Asian countries which have tended to be designated as nationally strategic industries. Examining the diverse development patterns, this chapter finds that the steel industries in latecomer Asian countries typically started growing through backward linkage effects from the growth of steel-user industries. Once the countries successfully utilized the advantages of backwardness in introducing steel production, the industry contributed to the formation and strengthening of the development inducement mechanism in society. The chapter also discusses how even the steel industry, which was once a symbol of national industrialization, is strongly and increasingly affected by the power of globalization in the twenty-first century by examining linkage effects and the (dis)advantages of backwardness.
Hajime Sato
7. ‘Catch-Down’ Innovation in Developing Countries
Abstract
This chapter demonstrates a unique development mechanism, naming it ‘catch-down innovation’. For developing countries to catch up with developed countries in terms of per capita income, it is often assumed that they need to catch up technologically. Interestingly, however, some firms in China and India have developed several indigenous technologies that cater to specific, low-income demand and the social environment of consumption in these countries. Calling this type of technological progress ‘catch-down innovation’, the chapter compares it with similar ideas presented in the 1970s such as ‘intermediate technology’. Then, the chapter presents five cases such as video CDs and puts forth a hypothesis that in countries with vast domestic markets stratified by urban–rural and regional disparities, catch-down innovations have a higher chance of success.
Tomoo Marukawa
8. Curse or Opportunity? A Model of Industrial Development for Natural Resource–Rich Countries on the Basis of Southeast Asian Experiences
Abstract
This chapter examines the effects of natural resources on the course of industrial development and offers a model that assumes the coexistence of natural and nonnatural resource industries in one country. The model shows how the prices of natural resources and institutions of a country affect patterns of industrial development. The model combines the logic of catch-up industrialization with the debate on whether natural resources are a curse or opportunity for developing countries. The assumptions of the model are fit for Southeast Asia, which participates in the regional dynamism of non-resource-based industrialization, while keeping natural resource industries active. This chapter uses the model to examine Indonesia and demonstrates that industrial development can move backward when there are surging resource prices without effective policies in place.
Yuri Sato
9. Resource-Based Industrialization of the Malaysian Palm Oil Industry
Abstract
This chapter attempts to delineate a model of resource-based industrialization by focusing on the experience of the Malaysian palm oil industry. The chapter examines how the palm oil industry upgraded its exports from crude palm oil to processed palm oil and became the world’s largest producer and exporter of palm oil for over 40 years until Indonesia surpassed it in the mid-2000s. It is true that Malaysia is blessed with suitable natural conditions for oil palm cultivation. However, the chapter argues that these are necessary, but not sufficient, conditions for successful development and it stresses the importance of other factors such as government policies, technological features specific to the industry, and changing circumstances in the world economy.
Hiroshi Oikawa
10. The Development of the Indian Software Services Industry
Abstract
This chapter illustrates that the software services industry in India is the largest in the developing world and that the leading Indian software firms have been successfully competing against established Western software service firms in the most lucrative segments of the services market for over a decade. The chapter examines the mechanisms and processes through which the Indian software services industry in general, and its major indigenous firms in particular, have developed. It finds that while substantive and contrasting forms of state intervention have played an important part in facilitating the industry’s rapid development, changes in market conditions and indirect yet fortuitous outcomes from industrial policy in other sectors also have proved crucial.
Jyoti Saraswati
Backmatter
Metadata
Title
Varieties and Alternatives of Catching-up
Editors
Yukihito Sato
Hajime Sato
Copyright Year
2016
Electronic ISBN
978-1-137-59780-9
Print ISBN
978-1-137-59779-3
DOI
https://doi.org/10.1057/978-1-137-59780-9