Posted by A few months ago, I received an excellent book recommendation. I must admit that, as an obvious foreigner in Seoul, I did sometimes feel sheepish when pulling a book titled “How Asia Works” out of my bag.
While it is by no means a new title, this gem by Joe Studwell provides a great macroeconomic look at a number of different countries in Asia. Studwell explores how interventions (or lack thereof) in agriculture, manufacturing, and capital allocation have impacted nine Asian countries, including Japan, Korea, Malaysia, and the Philippines.
He identifies three phases of development and key policies for each:
- Boosting agricultural output through land reform and a focus on small scale “gardening” to create a trade surplus
- Transitioning from agriculture to manufacturing with an emphasis on protectionism coupled with export discipline
- Ensuring that financial institutions funnel funds into the appropriate sectors at all times
Studwell goes on to provide plenty of examples of how adherence to these principles creates sustained growth and sugar-coats nothing when pointing out where failure to do so has led to disastrous outcomes.
With South East Asia’s diverse economies currently attracting a lot of investor attention, this book might help put their development and potential in a historical context. It’s also a must-read for any history, politics, or economics buff with ties to any of the countries above.
Nico Eggert 