Rdys Jenkins

Introduction

p. 72 - some argue the world will always be split between rich and poor, others that it will inevitably come to an equilibrium

Development in the NICs

South Korea, Tiawan, Hong Kong, Singapore, Brazil, and Mexico

p. 73 - these countries (particularly the Asian ones) have shown phenomenal growth over the last fifty years

in terms of GDP per capita they are roughly equivalent to the poorer European countries

Mexico and Brazil suffered more in the 1980s and are now lagging well behind

These countries no longer just export raw materials -- manufactures are now more than half of their exports

p. 74 -- the manufacturers are not simple high labour ones either -- they are advanced competitive technology products

inequality of distribution of the wealth associated with this growth has been better in these countries than in most third world nations

in terms of life expectancy and infant mortality, the asian NICs are at nearly first world levels while Mexico and Brazil are far behind

Critics of the NIC Model

argue that the costs of such development is too high or that the model is unsustainable in the long run

Superexploitation

fundamental to this development has been exploitation of the working force through suppression of trade unions, long hours, low wages, and unsafe working conditions

some violent unions are now developing

increases in productivity have allowed the asian NICs to increase wages while remaining competitive -- not so in Mexico

Sacrificing agriculture

p. 76 -- emphasis on industry has led to decrease in agriculture

land reform and increased yields meant this did not hurt production

in latin america this has had a much worse effect as their agricultural productivity is much lower

Environmental destruction

lots of problems from industrialization

not the typical development problems of desertification and soil erosion

Authoritarianism

p. 77 -- very little democracy, but that was never a part of capitalism

signs that it is now being won

Vulnerability

highly dependent on external markets, foreign technology

threatened by protectionism in the first world

threatened by cheaper labour in the third world

The Bases of Capitalist Development in the East Asian NICs

p. 78 -- why? everywhere else did much more poorly.

Land reform

agricultural land reform is critical to modernization

eliminated the land owning class in South Korea got rid of a potentially strong opposition to development

this reform led to a dramatic increase in productivity which allowed the state to use the income generated from agriculture for industrialization

Primitive accumulation

the land owning families were given shares in the government sponsored development in exchange for their land -- encouraged development

p. 79 -- dramatic role of US aid in Tiwan and Korea in the 1950s and 1960s

work for the US in Vietnam gave them development capital

Role of the state

the state has to be able to channel development money in a disciplined and effective manner

p. 80 -- separation of the state form political influences

land reform to prevent wasting money

incentives to encourage profit and punish non-compliance (South Korea)

Wage labour

needed a labour force with enough education to make it effective for industrial work

high state investments in education, particularly in engineering

lots of repression of violent workers

Wages and productivity

cheap wages have never been a basis for sustainable growth

increased productivity needs to go to increased wages to develop a domestic market as in the advanced capitalist countries

p. 81 -- the Asian NICs have virtually full employment

this level of employment has driven wages up and led to increased human development -- real development

Obstacles to Capitalist Development

in other countries the presence of a strong landed political class to oppose development has been a real problem

the absence of primitive accumulation is less of a problem given how much aid the asian NICs took in

the biggest problem ore weak states which cannot control the economy well enough to carry out a consistent and sustained development plan

large state bureaucracies make them inefficient and controlled by outside interests

need a well educated labour force

the ability to increase real wages has led to real development -- most other third world nations have failed to do this

The Prospects for Capitalist Development in the Third World

p. 83 -- all four East Asian NICs have moved beyond the cheap unskilled labour market

enough domestic market income to produce significant spending

dramatic growth in international firms

these countries have achieved a dynamic market -- they are developed

p. 84 -- the global market isn’t big enough for all nations to take the same development path