Research Article


DOI :10.26650/SJ.2020.40.2.0055   IUP :10.26650/SJ.2020.40.2.0055    Full Text (PDF)

Imitation, Innovation and State Capacity: What Do East Asian Industrial Policies Imply?

K. Ali AkkemikMurat Yülek

Since the global financial crisis, industrial policy is back on the agenda in developing economies after a long break. The renewed interest in the industrial policy manifested itself in the discussions on the new directions for policymaking. A crucial aspect of the recent industrial policies is technology policies, in which the developing policies face the trade-off between imitation and innovation. In this study, we examine the association between industrial policy and state capacity based on a theoretical model. We elaborate on the successful interventionist industrial policies of the East Asian economies in the past in conjunction with state capacity and technology policies. As evidence from Korea, Singapore and Taiwan shows simultaneous implementation of imitation and innovation policies is possible. Recent experience in China further supports this conclusion. The results indicate that state capacity has played an important role in the success of East Asian industrial policies.


PDF View

References

  • Acemoglu, D., Aghion, P., & Zilibotti, F. (2003). Vertical integration and distance to frontier. Journal of the European Economic Association, 1(2-3), 630–638. google scholar
  • Aiginger, K., & Rodrik, D. (2020). Rebirth of industrial policy and an agenda for the twenty-first century. Journal of Industry, Competition and Trade, 20, 189–207. google scholar
  • Aizenman, J., Jinjarak, Y., & Zheng, H. (2018). Chinese outwards mercantilism: The art and practice of bundling. Journal of International Money and Finance, 86, 31–49. google scholar
  • Akkemik, K. A. (2009). Industrial development in East Asia: A comparative look at Japan, Korea, Taiwan, and Singapore. World Scientific. google scholar
  • Akkemik, K. A., & Menteşoğlu Tuncer, B. (2019). Çin-ABD ticaret savaşları gölgesinde Çin sanayi ve teknoloji politikaları [China’s Industry and Technology Policies in the Shadow of the ChinaUSA Trade Wars]. In C. Bakır & M. Yağcı (Eds.), Çin bilmecesi: Çin’in ekonomik yükselişi, uluslararası ilişkilerde dönüşüm ve Türkiye [China conundrum: The rise of China’s economic transformation in international relations and Turkeyy] (pp. 77–101). Koç University Press. google scholar
  • Akkemik, K. A., & Yülek, M. (2020). ‘Made in China 2025’ and the recent industrial policy in China. In S. T. Otsubo & C. Otchia (Eds.), Designing integrated industrial policies: Industrial promotion for inclusive development under globalization (pp. 337–364). Routledge. google scholar
  • Andreoni, A., & Chang, H. J. (2019). The political economy of industrial policy: Structural interdependencies, policy alignment and conflict management. Structural Change and Economic Dynamics, 48, 136–150. google scholar
  • Amsden, A. (1989). Asia’s next giant: South Korea and late industrialization. Oxford University Press. google scholar
  • Barwick, P. J., Kalouptsidi, M., & Zahur, N. B. (2019). China’s industrial policy: An empirical evaluation. National Bureau of Economic Research Working Paper No. 26075. google scholar
  • Chang, H. J. (1993). The political economy of industrial Policy in Korea. Cambridge Journal of Economics, 17(2), 131–157. google scholar
  • Chang, H. J. (2011). Industrial policy: Can we go beyond an unproductive confrontation? In J. Lin & B. Pleskovic (Eds.), Annual World Bank conference on development economics (pp. 83–109). World Bank. google scholar
  • Chang, H. J., & Andreoni, A. (2020). Industrial policy in the 21st century. Development and Change, 51(2), 324–351. google scholar
  • Chang, H. J., & Zach, K. (2018). Industrial development in Asia: Trends in Industrialization and industrial policy experiences of developing Asia. United Nations University WIDER Working Paper No. 2018/120. google scholar
  • Cherif, R., & Hasanov, F. (2019). The return of the policy that shall not be named: Principles of industrial policy. IMF Working Paper No. WP/19/74. google scholar
  • Fernández-Arias, E., Hausmann, R., & Panizza, U. (2020). Smart development banks. Journal of Industry, Competition and Trade, 20, 395–420. google scholar
  • Gelb, A., Ramachandran, V., Meyer, C. J., Wadhwa, D., & Navis, K. (2020). Can Sub-Saharan Africa be a manufacturing destination? Labor costs, price levels, and the role of industrial policy. Journal of Industry, Competition and Trade, 20, 335–357. google scholar
  • Heilmann, S., & Shih, L. (2013). The rise of industrial policy in China, 1978-2012. Harvard-Yenching Institute Working Paper. google scholar
  • Hong, S. G. (1997). The political economy of industrial policy in East Asia: The semiconductor industry and South Korea. Edward Elgar. google scholar
  • Jomo, K. S., Chung, C. Y., Folk, B. C., Ul-Haque, I., Phongpaichit, P., Simatupang, B., & Tateishi, M. (2019). Southeast Asia’s misunderstood miracle: Industrial policy and economic development in Thailand, Malaysia and Indonesia. Routledge. google scholar
  • Khan, M. H., & Blankenburg, S. (2009). The political economy of industrial policy in Asia and Latin America. In M. Cimoli, G. Dosi, & J. E. Stiglitz (Eds.), Industrial policy and development: The political economy of capabilities accumulation (pp. 336–377). Oxford University Press. google scholar
  • König, M., Song, Z., Storesletten, K., & Zilibotti, F. (2020). From imitation to innovation: Where is all that Chinese R&D going? National Bureau of Economic Research Working Paper No. 27404. google scholar
  • Kurtz, M. J., & Schrank, A. (2007). Growth and governance: Models, measures, and mechanisms. Journal of Politics, 69(2), 538–554. google scholar
  • Lin, J. Y., & Chang, H. J. (2009). Should industrial policy in developing countries conform to comparative advantage or defy it? Development Policy Review, 27(5), 483–502. google scholar
  • Lin, J. Y., & Wang, Y. (2020). Structural change, industrial upgrading, and middle-income trap. Journal of Industry, Competition and Trade, 20, 359–394. google scholar
  • Mazzucato, M. (2013). The entrepreneurial state: debunking the public vs. private myth in risk and innovation. Anthem Press. google scholar
  • Mazzucato M., & Penna, C. C. R. (2016). Beyond market failures: The market creating and shaping roles of state investment banks. Journal of Economic Policy Reform, 19(4), 305–326. google scholar
  • Olsson, O. (2012). Essentials of advanced macroeconomic theory. Routledge google scholar
  • Otsubo, S. T., & Otchia, C. S. (2020). Designing integrated industrial policies volume II: For inclusive development in Africa and Asia. Routledge. google scholar
  • Page, J., & Tarp, F. (Eds.). (2017). The practice of industrial policy: Government-business coordination in Africa and East Asia. Oxford University Press. google scholar
  • Rodrik, D. (2016). Premature deindustrialization. Journal of Economic Growth, 21(1), 1–33. google scholar
  • Romer, P. (1986). Increasing returns and long-run growth. Journal of Political Economy, 94, 1002–1037. google scholar
  • Romer, P. (1990). Endogenous technological change. Journal of Political Economy, 98, 71–102. google scholar
  • Singh, J. N., & Ovadia, J. S. (2018). The theory and practice of building developmental states in the global south. Third World Quarterly, 39(6), 1033–1055. google scholar
  • Stiglitz, J. E. (2017). Industrial policy, learning, and development. In J. Page & F. Tarp (Eds.), The practice of industrial policy: Government-business coordination in Africa and East Asia (pp. 23–39). Oxford University Press. google scholar
  • Stiglitz, J. E., & Lin, J. Y. (Eds.) (2014). The industrial policy revolution, vol. 1: The role of government beyond ideology. Palgrave Macmillan. google scholar
  • Wade, R. (1990). Governing the market: Economic theory and the role of government in East Asian industrialization. Princeton University Press. google scholar
  • Wade, R. (2010). After the crisis: Industrial policy and the developmental state in low-income countries. Global Policy, 1(2), 150–161. google scholar
  • Wade, R. (2015). The role of industrial policy in developing countries. In A. Calcagno, S. Dullien, A. Márquez-Velázquez, N. Maystre, & J. Priewe (Eds.), Rethinking development strategies after the financial crisis, volume I: making the case for policy space (pp. 67–79). UNCTAD and Hochschule für Technik und Wirtschaft Berlin. google scholar
  • Wong, P. K. (2001). The role of state in Singapore’s industrial development. In P. K. Wong & C. Y. Ng (Eds.), Industrial policy, innovation and economic growth: The experience of Japan and the East Asian NIEs (pp. 503–579). Singapore University Press. google scholar
  • Woo-Cumings, M. (Ed.). (1999). The developmental state. Cornell University Press. google scholar
  • Wu, R. I., & Tseng, M. S. (1998). The development of the information industry in Taiwan. In K. Takahashi (Ed.), Asia’s development experiences: How internationally competitive manufacturing firms developed in Asia (pp. 76–124). FASID. google scholar
  • Yülek, M. (2018). How nations succeed. Palgrave Macmillan. google scholar
  • Yülek, M. A., Lee, K. H., Kim, J., & Park, D. (2020). State capacity and the role of industrial policy in automobile industry: A comparative analysis of Turkey and South Korea. Journal of Industry, Competition and Trade, 20, 307–331. google scholar

Citations

Copy and paste a formatted citation or use one of the options to export in your chosen format


EXPORT



APA

Akkemik, K.A., & Yülek, M. (2020). Imitation, Innovation and State Capacity: What Do East Asian Industrial Policies Imply?. İstanbul University Journal of Sociology, 40(2), 701-722. https://doi.org/10.26650/SJ.2020.40.2.0055


AMA

Akkemik K A, Yülek M. Imitation, Innovation and State Capacity: What Do East Asian Industrial Policies Imply?. İstanbul University Journal of Sociology. 2020;40(2):701-722. https://doi.org/10.26650/SJ.2020.40.2.0055


ABNT

Akkemik, K.A.; Yülek, M. Imitation, Innovation and State Capacity: What Do East Asian Industrial Policies Imply?. İstanbul University Journal of Sociology, [Publisher Location], v. 40, n. 2, p. 701-722, 2020.


Chicago: Author-Date Style

Akkemik, K. Ali, and Murat Yülek. 2020. “Imitation, Innovation and State Capacity: What Do East Asian Industrial Policies Imply?.” İstanbul University Journal of Sociology 40, no. 2: 701-722. https://doi.org/10.26650/SJ.2020.40.2.0055


Chicago: Humanities Style

Akkemik, K. Ali, and Murat Yülek. Imitation, Innovation and State Capacity: What Do East Asian Industrial Policies Imply?.” İstanbul University Journal of Sociology 40, no. 2 (Jul. 2022): 701-722. https://doi.org/10.26650/SJ.2020.40.2.0055


Harvard: Australian Style

Akkemik, KA & Yülek, M 2020, 'Imitation, Innovation and State Capacity: What Do East Asian Industrial Policies Imply?', İstanbul University Journal of Sociology, vol. 40, no. 2, pp. 701-722, viewed 6 Jul. 2022, https://doi.org/10.26650/SJ.2020.40.2.0055


Harvard: Author-Date Style

Akkemik, K.A. and Yülek, M. (2020) ‘Imitation, Innovation and State Capacity: What Do East Asian Industrial Policies Imply?’, İstanbul University Journal of Sociology, 40(2), pp. 701-722. https://doi.org/10.26650/SJ.2020.40.2.0055 (6 Jul. 2022).


MLA

Akkemik, K. Ali, and Murat Yülek. Imitation, Innovation and State Capacity: What Do East Asian Industrial Policies Imply?.” İstanbul University Journal of Sociology, vol. 40, no. 2, 2020, pp. 701-722. [Database Container], https://doi.org/10.26650/SJ.2020.40.2.0055


Vancouver

Akkemik KA, Yülek M. Imitation, Innovation and State Capacity: What Do East Asian Industrial Policies Imply?. İstanbul University Journal of Sociology [Internet]. 6 Jul. 2022 [cited 6 Jul. 2022];40(2):701-722. Available from: https://doi.org/10.26650/SJ.2020.40.2.0055 doi: 10.26650/SJ.2020.40.2.0055


ISNAD

Akkemik, K.Ali - Yülek, Murat. Imitation, Innovation and State Capacity: What Do East Asian Industrial Policies Imply?”. İstanbul University Journal of Sociology 40/2 (Jul. 2022): 701-722. https://doi.org/10.26650/SJ.2020.40.2.0055



TIMELINE


Submitted15.07.2020
Accepted22.11.2020
Published Online31.12.2020

LICENCE


Attribution-NonCommercial (CC BY-NC)

This license lets others remix, tweak, and build upon your work non-commercially, and although their new works must also acknowledge you and be non-commercial, they don’t have to license their derivative works on the same terms.


SHARE




Istanbul University Press aims to contribute to the dissemination of ever growing scientific knowledge through publication of high quality scientific journals and books in accordance with the international publishing standards and ethics. Istanbul University Press follows an open access, non-commercial, scholarly publishing.