Taiwanese Economy
Much like Haiti in its early years, the Taiwanese economy relied heavily on agriculture. Unfortunately, due to the political disputes with China, the World Bank does not recognize Taiwan as a sovereign nation and its data is mixed in with China’s. As a result, I can’t produce the same chart as I did for Haiti detailing their economic performance since the 1970s. However, if I did have a chart, it would look nothing like Haiti’s on the previous page. Where the Haitian economy has stagnated and stayed relatively constant since 1970, the Taiwanese economy has taken off since then. From 1960 to today, Taiwan has managed sustained economic growth and almost caught up to the same levels as developed countries in Europe and the Americas (Rodrik). What’s even more intriguing is that Taiwan had about the same level of economic output as Haiti and the rest of the Latin American countries up until the 1960s. So, what was it that the Taiwanese were able to do to succeed where so many other nations have failed?
In a scholarly article attempting to answer this very question for both Taiwan and South Korea, the authors claim that the, “the South Korean and Taiwanese ‘miracles’ can be best understood by taking seriously what the two governments thought and said they were doing: namely, coordinating and encouraging private (and public) investments with a high degree of linkages within the modern sector. Such policies had a high payoff because they helped remove coordination failures in economies where the latent return to investment was already high. A relatively skilled and educated workforce was a necessary condition. So was a relatively equal distribution of resources…” (Rodrik 97). The authors claim that the combination of market-oriented government policies aimed at encouraging investment coupled with a baseline set of economic conditions is what enabled the two countries to grow as rapidly as they did. While many Latin American countries have tried to copy and paste the same government policies in hopes of achieving the same levels of growth, none have been very successful.
The video below fills in some of the data blanks left by the World Bank so we can compare the economic performance of the two nations..