The East-Asian Development Model

This study note looks at the East Asian Development Model

The East Asian development model is a term used to describe the economic development strategies that have been pursued by the countries of East Asia, such as Japan, South Korea, and Taiwan. These strategies have been characterized by high levels of investment in education, infrastructure, and technology; export-oriented growth; and government intervention in the economy.

The East Asian development model has been successful in achieving rapid economic growth. Between 1960 and 1990, the average annual growth rate of GDP in East Asia was 8.5%, compared to 3.5% for the world as a whole. This growth has lifted millions of people out of poverty and has made East Asia one of the most prosperous regions in the world.

There are a number of factors that have contributed to the success of the East Asian development model. These factors include:

• A high level of investment in education and human capital. East Asian governments have invested heavily in education, which has helped to create a skilled workforce.
• Export-oriented growth. East Asian countries have focused on exporting goods and services, which has helped to drive economic growth.
• Government intervention in the economy. East Asian governments have intervened in the economy to promote growth and development. This intervention has included providing subsidies, tax breaks, and other forms of support to businesses.

The East Asian development model has been criticized for being too reliant on government intervention and for creating a system of crony capitalism. However, the model has also been praised for its success in achieving rapid economic growth and for lifting millions of people out of poverty.

• Ha-Joon Chang is a South Korean economist who is critical of the Washington Consensus, which is a set of economic policies that have been promoted by the World Bank and the International Monetary Fund. Chang argues that the East Asian development model is based on state intervention and that it has been more successful than the Washington Consensus in promoting economic growth.