+(,121/,1(

Citation: 16 Brown J. World Aff. 203 2009-2010

Content downloaded/printed from

HeinOnline (http://heinonline.org)
Fri Mar 20 18:55:40 2015
-- Your use of this HeinOnline PDF indicates your acceptance
of HeinOnline's Terms and Conditions of the license
agreement available at http://heinonline.org/HOL/License
-- The search text of this PDF is generated from
uncorrected OCR text.
-- To obtain permission to use this article beyond the scope
of your HeinOnline license, please use:
https://www.copyright.com/ccc/basicSearch.do?
&operation=go&searchType=0
&lastSearch=simple&all=on&titleOrStdNo=1072-6799

Role Models and Policy Rights

ALICE AMSDEN

Professor
Massachusetts Institute of Technology

FASTER ECONOMIC DEVELOPMENT WAS ONCE associated with a good theory, but in the
prosperous Golden Age that followed World War II, from roughly 1947 to 1980, poor
countries tended to learn from each other, not from abstractions. They experimented
with policies and institutions based on those of an outstanding role model.' As this form
of learning evolved, economic growth rates in nearly all Third World regions reached
unprecedented heights. For the first time in modern history, Third World economies
grew faster than First World economies, as seen in Table 1. Then, in the counter-age of
"economic Liberalism," from 1981 to the 2000s, when developing country policymaking
became tightly tied to theories of market behavior, growth rates in almost all regions
fell.2 Intolerance of non-market provisions in the areas of trade, industry, ownership
and employment became a hallmark of a new globalism, as the former colonial powers returned to their ideal of "universalism," a one-policy agenda for rich and poor
countries alike no matter how many or diverse; this was the only cost-effective way to
govern them. Yet the survival of role models depends on "policy rights," or the freedom,
against possible foreign opposition, from Washington to the World Bank, to choose
the policies that role models themselves once followed, towards foreign investment and
capital controls or trade agreements and job formation. Given their thirst for diversity
in a world celebrating one particular set of market policies for all, the question arises
of whether or not role models have been left in limbo, and with them, an empirically
grounded, deductive way of thinking about economic growth?

ALICE AMSDEN is the Barton L. Weller Professor of Political Economy in the Department of Urban Studies and Planning at the Massachusetts Institute of Technology. She was recently appointed by the United
Nations secretary-general to a three-year seat on the UN Committee on Development Policy. Her work
focuses on issues of development and poverty eradication.
Copyright @ 2009 by the Brown JournalofWorldAffairs

FALL/WINTER 2009 * VOLUME XVI, ISSUE I

203

ALICE AMSDEN

Today's global culture celebrates electoral rights, education rights, human rights,
housing rights, health rights and women's rights-anything but country-specific "policy
rights."
Developing countries discovered role models among their peers, in geographical
proximity. This tendency gave rise to two regional clusters of role models, with pure
theory left to influence mostly fiscal and monetary policies-even so, countries like
Brazil, China and India tend to follow fiscal and monetary policies based on their own
histories, not abstract theories.
The Organization of the Petroleum Exporting Countries (OPEC) is associated
with a price cartel. But the OPEC development model also revolves around a professionally managed state-owned oil company, which was formerly a private multinational
concession, nationalized after political independence. In East Asia, import-substitution
industrialization (ISI) became the basis of a role model radiating from Japan, in which
domestic markets were seized from foreign companies, and then exports were extracted
from import substitutes to enter foreign markets. Latin America, with both oil wealth
and manufacturing experience, combined the two models. Africa, without manufacturing experience or oil-until recent discoveries-could not break into either circle.
The shift in the cognitive approach to economic development, away from de204

ductive market theories towards inductive role models, was an integral part of the decolonization process that followed World War II, starting in 1947 with India's political
independence. A culture of anti-imperialism pushed independence beyond politics into
economics, in what became a novel "nationalist" approach to late development, with
nationally owned and controlled companies (private or public) at its core.
The edge of the envelope was the

Latin America missed the cathartic effectb Chinese Revolution (1927-1949) that exof twentieth-century decolonization. propriated not only foreign governments but
also foreign firms, as did India using tamer
tactics, such as acquiring British firms, exhausted from depression and war, at firesale
prices. Korea and Taiwan inherited the investments of Japanese-owned zaibatsu when
Tokyo conceded military defeat. Indonesia acquired Dutch companies when the Dutch
government fled after a long nationalist struggle. In contrast, the Philippines was one
of the first of its generation to gain political independence, from the United States, but
never showed the door to U.S.-owned firms. A large stock of inward foreign investment
was also true of Latin America, which missed the cathartic effect of twentieth-century
decolonization. Multinationals that arrived in Latin America before World War Two
simply remained, although some electric power industries and railroads were nationalized.4 With implacable foreign firms, there was "crowding out" of private nationally
owned companies in industries like automobiles.' By this account, fast-growing East

THE BROWN JOURNAL OF WORLD AFFAIRS

Role Moded and Policy Rights

Asia (excluding the Philippines) is more nationalist than Latin America. The Middle
East, by appropriating the concessions of the world's largest oil companies, named the
Seven Sisters, shows a degree of nationalism that is easily equal to that of East Asia.
By the same reckoning, both East Asia and the Middle East enjoy more "policy rights"
than Latin America, or more freedom to decide, against foreign opposition, if any,
which nationalist economic measures to introduce. The strength of role models today
thus depends on the strength of their policy rights. The greater their rights, the greater
their latitude to choose the policies best suited to raising their global competitiveness,
income and wealth to the level of their role model.
If the two great role models of the late-twentieth century, OPEC and ISI, had
failed, if they had not raised national incomes and spread to other countries, then as
the world returned to an open-market system after 1980, policy rights would probably
have expired. But they did not fail, and that did not happen. Washington, the World
Bank, and the World Trade Organization are quick to label the role models of the Far
East and Middle East as failures. After the East Asian financial crisis of 1997, Asia's role
model was pronounced dead, and once oil was discovered outside the Middle East, the
OPEC cartel, let alone the OPEC development model, was relegated to the dustbin
of history. True, income growth in the Middle East and Asia slowed under neo-liberal
policies, but hardly to a crawl, and not at all in India and China, whose reforms, like
the policy framework of the two role models themselves, were a mixture of market
and state, and whose demand for raw materials, 2000 through 2008, created a boom
in Third World mineral economies. Instead of failing, the East Asian role model has
adapted import substitution to "mature" high-tech industries.' The OPEC development
model, apart from the OPEC cartel, has inspired the Bolivaristas (Venezuela, Ecuador,
Bolivia, and a total of eleven Latin American countries), the resource-rich BRICs (Brazil,
Russia, India and China), and 40 poor oil-producing countries (about one-third of
the developing world) still at the bottom of the hydrocarbon value chain. The top ten
companies in oil and gas reserves are all state-owned, and from the developing world.
National oil companies threaten to do to the U.S. oil, gas and petrochemical industries
what Japanese factories-and now Korean and Chinese factories-once did to the U.S.
car and electronics industries.
National role models have survived the return to power of a theory-driven global
regime because this regime, however monolithic in appearance, is being fractured in
practice by its own institutional wear and tear. It started to unravel once the de-colonized generation began to compete in world markets. As developed countries felt the
heat of new competition, they ran helter-skelter, seeking more leeway in setting their
own policies to strengthen industries back home. The upshot is a large underground,
or "demimonde," where countries promulgate free trade by day but practice state-pro-

FALL/WINTER 2009 * VOLUME XVI, ISSUE I

205

ALICE AMSDEN

motion of industries by night.

Backtracking is most evident in international trade, the backbone of globalism.
Protective tariffs remain low, but trade is no longer "free," as theoretically defined. Despite the rhetoric, regional trade agreements like NAFTA favor member countries over
non-members, the antithesis of a level playing field. As India noted openly at a WTO
meeting, "it is well documented that Regional Trade Agreements are proliferating and
most of global trade is conducted on preferential terms."' The World Trade Organization
itself, once a bastion of transparency, is opaque in its governance. According to the Malaysian delegate, "Well, [the WTO] is supposedto be democratic-it is member driven,
and every member has a vote. So it has all the elements of a democratic institution, on
paper at least... In practice, there have been complaints that the agenda is dictated by
very few powerful countries."' The Business Standardof India reported that a demand
from the WTO's then director, Mr. Pascal Lamy, for a 30 percent pay hike at a time of
global wage deflation, was not handled democratically by the WTO's budgetary committee, but was decided against by rich members behind closed doors.'o
In the milieu of the demimonde, where all policymakers enjoy a degree of freedom, role models survive. The practical question is how effective are they likely to be
in running an underground pro-industry policy?
206

We would argue that the effectiveness of informal policymaking depends on two

rather disconnected influences: first, the quality of key government economic bureaucracies; and second, their relationship to the grassroots anti-poverty movement, which
attempts to return decision- making power to local people. The higher the quality of
national universities, national civil service entrance exams; and the greater the national
orientation of high government officials, measured by the geographical locus of their
tertiary degree, then the better will be policy coordination. The more cooperative relations are between anti-poverty activists and government economic planners (most now
democratically elected), the more effective policy implementation will be.
Below we discretely draw the curtain on the demimonde, show some data on
the education of top economic bureaucrats (in the BRICs), and finally, note the need
for a stronger alliance between bureaucrats and activists.
"NOBODY GAvE A DAMN"

The first generation of post-Independence leaders was able to enjoy nearly unrestrained
policy rights because, as Richard Nixon observed, "nobody gave a damn."" The developing economies were less interesting to Wall Street or Washington than Western
Europe, the target in the 1950s of American multinationals, just as Meiji Japan was
less interesting to investors than Reconstruction profiteering after the American Civil

THE BROWN JOURNAL OF WORLD AFFAIRS

Role Moded and Policy Rights

1

War. But as Japan recovered from military defeat and its exports boomed, and as competition from the whole Japanese role model aureole commenced, everything changed.
Suddenly the United States gave a big damn. Today's regional trade agreements signal
the tensions of universalism, of a shoe that is too tight for too many feet.
THE DEMIMONDE

Poor countries were divided over the WTO's formation in 1994-some gained, some
lost, so no consensus emerged over what to do." Instead, dissatisfied countries sought
autonomy with subterfuges.14 As they descended into a demimonde, the habituees they
rubbed shoulders with were none other than the advocates of open markets. Hypocrisy
in any demimonde is rank.
One American subterfuge was the military industrial complex-a term in President
Eisenhower's 1961 farewell address.' The United States Department of Defense and
National Institute of Health are mainstays of U.S. private manufacturing, subsidizing
industries ranging from batteries and aerospace to bio-tech and agriculture. Manufacturers and the military bonded after the American Revolution. Ironically, "modern factory
management had its genesis in the United States (the most pro-market country in the
world) in the Government Springfield Armory in Massachusetts." Defense industries are
not adjudicated under WTO rules, and so governments are free to promote them.
Despite big armies in Russia, India and China, developing countries invented
different subterfuges. They used both piecemeal artifices as well as multi-billion dollar
science parks to undertake the technological and organizational experimentation necessary to move into higher skilled industries. The difference between the military-industrial complex model and the science park model is that the former builds technologies,
while the latter builds technologies with, inter-connectedly, specific nationally owned
firms. R&D is also not adjudicated by the WTO, so science parks can promote new
industries and firms so long as there is money.
Piecemeal policies in the demimonde may have failed in droves, but some were
highly effective in raising skilled employment. The Indian government allowed the Indian-owned pharmaceutical industry to violate foreign product patents, but not process
patents, which contributed to efficient manufacturing and cheap drugs (the adjudication of healthcare industries under the WTO is ambiguous). Besides pharmaceuticals,
developing countries have called for the relaxation of intellectual property rights on
climate friendly technologies under the United Nations Framework Convention on
Climate Change-all industries related to the environment can be state-supported.
Regarding foreign capital flows, while financial liberalization was the primary factor
behind East Asia's 1997 financial crash, Korea was forced to keep its financial markets

FALL/WINTER 2009 * VOLUME XVI, ISSUE I

207

ALICE AMSDEN

open after an IMF bailout. The Finance Ministry responded by using modern technology
to monitor every financial flow on a minute-to-minute basis to reduce risk and quicken
government response, in effect, closing markets after hitting a ceiling. To reduce export
dependence on the U.S. market, Korea offered subsidies to companies that exported to
other destinations (in distress, countries can protect their balance of payments).
Thus, WTO members are themselves responsible for weakening their own ban
on subsidies by agreeing not to adjudicate large chunks of what was once called industrial policy. One of the fastest growing sectors in the world economy is energy and the
environment, and any country with money can vigorously promote them without being
taken to court for violating WTO provisions. Chinese government research subsidies
are increasing rapidly for electric car designs, for example; and tax credits are planned
for consumption of alternative energy vehicles. The world over, states and municipalities can offer perks to businesses to influence their location decisions. Poor regions in
Thailand use subsidies to attract automobile assemblers. The U.S. state of Massachusetts
bankrolls the movie business and the life sciences, and allows not-yet-profitable start-ups
to convert tax credits into cash. Subsidies can flow to science parks, R&D institutes,
high-tech industries, and small-scale enterprise-without these exceptions, probably
no developed country would have joined the WTO. Planners can use land grants to
208

promote regional development, and government procurement officers can attach conditions on firms that compete for public contracts: when Korea built a high-speed rail,
it insisted that every bidder transfer enough technology to enable Korean companies
in their own right to bid on overseas high speed rail projects. Hyundai Rotem, Korea's
premier high-speed rail manufacturer now has contracts to build commuter rail systems
in Canada, Turkey, and the United States.
American trade officials viewed China's export tax rebates as a form of protection,
but, surprisingly, "tax rebates did not violate World Trade Organization provisions."'6
To avoid a clash, both giants agreed to offer developing economies S20 billion in subsidized export credits to help them buy more Chinese and American goods, flagrantly
violating the WTO equal treatment principle for all other countries."
If anyone says "neo-liberalism lives," they are right insofar as that is the law. If
they say, "neo-liberalism is dead," that is right, in a sense, as well-the law is increasingly evaded.
NATIONAL BUREAUCRATS

If a country pursues free market policies, its chief economic bureaucrats must be
trained in a U.S. or British economics department. If, by contrast, a country's policies
are role model driven, then its bureaucrats must be experienced in building heterodox

THE BROWN JOURNAL OF WORLD AFFAIRS

Role Moded and Policy Rights

institutions-those deviating from free market prescriptions-and implementing
them in national contexts. The latter type of bureaucracy, it turns out, has survived in
at least Korea and the BRICs, despite 25 years of liberal attempts at "taking the state
back out.""
The orientation of top economic civil servants may be proxied by where they
earned their graduate degree, if any. If top officials in the ministry of finance, industry
and central bank all study for their masters or Ph.D degrees in leading U.S. economics departments, it is reasonable to expect that their policy preferences will fall on the
orthodox side. By contrast, countries whose civil servants must pass rigorous exams, and
whose local universities are able to train them at world standards, are likely to operate
successfully with an activist state.
Following World War II, little public money existed in the de-colonized world
for sending promising public officials abroad for schooling. Even today, civil servants
in poor countries, even India, are just beginning to have foreign degrees, while national
universities still suffer from financial hardship; this is evidence of poverty rather than
nationalism. The role model for a "national orientation" is perhaps Korea, because of its
mix of local and foreign degrees, made possible by the high quality of its own universities (as in all the BRICs), where civil servants can get a first-rate education, not just in
economic modeling but also in national economic and diplomatic history.
Korea now gives the appearance of being wholly Americanized. Japan's popula-

209

tion is about three-times that of Koreas, but since at least 1970, Koreans outnumber
Japanese earning economic Ph.Ds in the United States: in 2000, the ratio of "A-TKFs"
(American-trained Korean economists) to "A-TJEs" (American-trained Japanese
economists) was 39 to 16.1) Nearly 100 percent of the tenured faculty in the economics departments of the best Korean universities is U.S.-trained, and about 97 percent
of economists in a leading macroeconomic think-tank, Korea Development Institute,
hold U.S. degrees. Nevertheless, unlike Koreas

universities, which lack diversity, its economic

bureaucracies are more balanced. In 2009, a

orientation" is perhaps Korea.

typical pattern of foreign and local degrees was evident in Korea's Ministry of Strategy
and Finance: the Minister and two Vice Ministers all held higher degrees from both
foreign and local universities, suggesting a mixture of influences.
In Brazil, nearly all high-level officials in the Ministry of Finance and Ministry
of Planning hold Brazilian Ph.Ds; the one U.S. degree is from a radical U.S. university
(New School for Social Research). In Russia, not only do the economics ministries
not have foreign-trained economists, they probably do not have any economists. Explains one researcher, "most senior officials would actually be engineers, scientists, and
mathematicians, with degrees from the Soviet's best universities."20 India's economic

FALL/WINTER 2009 * VOLUME XVI, ISSUE I

ALICE AMSDEN

ministries, like Russias, have a high ratio of domestic to foreign degrees, although this
is changing, as more money is available for study abroad. Despite China's rapid Westernization, its finance ministry and National Development and Reform Commission
are almost totally run by elites from China's own best universities.
There is thus a well-educated national civil service in the BRICKs (including
Korea) to coordinate a later stage of development policies, those that have gone underground.
THE UNDERGROUND AND THE GRASSROOTS

As governmental organizations were marginalized, non-governmental organizations

(NGOs) mushroomed, part of a vast grassroots anti-poverty movement that has come
to unite World Watch, for example, a monitor of the environment, the World Bank,
the Ford Foundation and other elite bodies with large field offices, and unpaid volunteers in the thousands, including students, scientists and engineers, working with
local counterparts to improve how poor people are clothed, housed and fed. Activists
are politically diverse (witness the November 1999 Seattle demonstrations against the
WTO), yet elite aid networks are generally hostile towards state activism, and want a
210

redistribution of power over poverty from top-down to bottom-up. Amartya Sen, a

Nobel economics laureate, described the top-down approach as "fierce," meaning tough
on the poor, and the grassroots approach, to which he has contributed so much, as
"friendly" ("congeniality is exemplified by such things as mutually beneficial exchanges
[of which Adam Smith spoke eloquently], or by the working of social safety nets, or
of political liberties, or of social development"). 2
But redistribution, however friendly, has been a disaster in fact: extreme poverty
has not fallen at all in many developing regions in the last 25 years. Of course, things
might have been worse if the grassroots had not grown, but by the same logic, things
might have been much better if governments hadn't been squeezed out of irrigation,
rural electrification (China excels as a role model), and industrialization (to create paid
workers instead of volunteers).12 As seen in Table 2, based on World Bank data for
1981 to 2005 and established estimation techniques, abject poverty has not fallen in
Latin America or Africa, despite the enormous effort and energy directed there.21 The
welfare of the poor may have increased, leading to a rise in life expectancy. But the
failure of poverty rates to fall suggests that higher life expectancy increases population
growth rates which, in Malthusian fashion, lead to diminishing returns. The poor live
longer but don't consume more.
The failure to reduce abject poverty can be traced to an abstraction, a strong belief
that "supply creates its own demand."24 Like Say, grassroots activists imagine incorrectly

THE BROWN JOURNAL OF WORLD AFFAIRS

Role Moded and Policy Rights

that what awaits a supply of better clothed, housed, and fed workers is the demand to
employ it at a living wage. Yet, if unemployment already exists, then to invest more in
workers' capabilities may create more unemployed job seekers, not more jobs.2 5 Call
thiw the "Kerala Effect," after the South Indian state which has experienced rising
educational attainments but not decreasing poverty. With sluggish demand, people
may simply be forced to "hire" themselves at starvation wages, and enter into "mutually
beneficial exchanges" as Sen puts it, at near subsistence rates of return. While education
and development are closely linked, if more money is poured into tertiary education,
graduates are likely to add to the educated unemployed, or the exodus of talent abroad.
For one, educated unemployment in Indonesia is estimated to have exceeded 787,800
in 2007.26 Thus, jobs do not necessarily make an appearance simply because the supply
of qualified job seekers improves as a result of grassroots activism. The demand side
must also be improved, and this requires the government.
CONCLUSION

Amidst the paroxysms that accompanied de-colonization after World War II, independent countries extended their newly won political freedoms into the economic realm.
They exited the market model and entered a deductive world where they learned from
role models (the OPEC group in the hydrocarbon industries and Japan in electronics
and automobiles). They experimented with novel policies and institutions to escape
past failures and to develop, which at the time meant increasing productivity, raising
the number of paid jobs to near full employment, and achieving balance of payments
stability. As role models advanced, economic growth in income and per capita income
soared to unprecedented heights (see Table 1).
To implement a role model rather than a market theory is to be pragmatic,
and pragmatism necessitates policy rights, or the freedom to implement a range of
development provisions that may face foreign opposition on the grounds that they
deviate from market theory. Yet today's global culture celebrates property rights, electoral rights, education rights, human rights, housing rights, health rights and women's
rights-anything but country-specific policy rights, which the de-colonized generation
struggled long and hard to achieve.
Does this mean that the role model is ruined as a cognitive form of development,
and civilization is returning to the colonial age, when Britain adopted a "universalist"
economic approach to govern its large and diverse empire? Can heterogeneous role
models survive in today's ideological straightjacket?
The answer to this question is empirically grounded, like role models themselves. Powerful developing countries, the BRICs and other emerging economies con-

FALL/WINTER 2009 * VOLUME XVI, ISSUE I

211

ALICE AMSDEN

tinue to implement heterodox economic policies in a dense "demimonde," rubbing

shoulders with developed countries, all searching for clever new ways to promote their
own industries-a competition which is arguably healthy compared to protectionism
using tariffs. To coordinate underground policies, these countries still have what it takes:
an able national economic bureaucracy, locally trained and tested. The big challenge
is poverty alleviation, and adding a top down angle to the grass roots approach, which
failed in the last 25 years to decrease Africas worst indigence (see Table 2).
Ifwe gingerly look 25 years out, and imagine what the world economy will look
like, we already know it will not conform to the classification it followed after World War
II, where countries belonged either to the First World, Second World (Soviet countries),
or Third World. The Second category is already gone, and the Third category is unlikely
to vanish in a velvet revolution, but a "big" chunk of the de-colonized generation, in
terms of land mass and population, is now floating between worlds. If underground
policy making continues, and if government bureaucracies remain national in orientation, which is almost certain, then the global economy of 2035 is likely to exhibit a
high degree of diversity, although just how much is not yet clear.

212

THE BROWN JOURNAL OF WORLD AFFAIRS

Role Moded and Policy Rights

TABLE

1. GDP

GROWTH RATE AND

Region

GDP

PER CAPITA GROWTH RATE,

GDP Growth Rates

1950-1980

1980-2000

1950-2000

GDP Per Capita Growth Rates

1950-1980
4

3.2 %

1980-2000
2.0 6 %

Western Europe

4.20%

2.20%

United States

3.47%

3.45%

1.79%

1.93%

Japan

7.10%

2.65%

5.50%

2.12%

Developed
Countries
Average

4.12%

2.46%

3.0 6 %

1.97%

Eastern Europe

5.46%

0.41%

4.31%

-0.85%

4.75%

2.32%

2 15%

0.55%

East Asia

6.90%

5.83%

4.11%

3.43%

South Asia

3.98%

5.05%

1.21%

2.49%

8.04%

2.03%

3.01%

0.47%

North Africa

5.32%

3.56%

2.30%

1.25%

Africa, South of
Sahara

3.70%

2.61%

1.20%

-0.12%

Developing
Countries
Average

5.06%

3.02%

2.04%

0.75%

and USSR
Latin America

Asia

Middle East
Africa

Source: World Tables, Johns Hopkins University (1980, 1994) and WorldDevelopmentIndicdtors,World
Bank (2002), http://www.worldbank.org.

FALL/WINTER 2009 * VOLUME XVI, ISSUE I

213

ALICE AMSDEN
TABLE

2.

POVERTYS PERSISTENCE IN AFRICA AND LATIN AMERICA,

1981-2005

Poverty Gap index (x100)

214

Region

1981

1990

1999

2005

East Asia and Pacific (A)

35.5

18.2

10.7

Of which China (B)

39.3

20.7

11.1

Eastern Europe and Central Asia [C]

0.4

0.6

1.6

1.1

Latin America and Caribbean (D)

3.6

4.2

3.2

Middle East and North Africa (E)

1.6

0.9

0.8

0.8

South Asia (F)

19.6

15.2

11.7

10.3

Of which India (G)

19.6

14.6

11.7

10.5

Sub-Saharan Africa (H)

22.9

26.6

25.7

21.1

Total (I)

21.3

14.2

10.9

7.6

Percentage below $1.25 / day

Region

1981

1990

1999

2005

East Asia and Pacific (A)

77.7

54.7

35.5

16.8

84

60.2

35.6

15.9

Eastern Europe and Central Asia [C]

1.7

5.1

3.7

Latin America and Caribbean (D)

11.5

9.8

10.8

8.4

Middle East and North Africa (E)

7.9

4.3

4.2

3.6

South Asia (F)

59.4

51.7

44.1

40.3

59.8

51.3

44.8

41.6

Sub-Saharan Africa (H)

53.7

57.9

58.2

51.2

Total (I)

51.8

41.6

33.7

25.2

Of which China (B)

Of which India (G)

Source: Shaohua Chen and Martin Ravallion, "Policy Research Working Paper 4703: The Developing
World Is Poorer Than We Thought, But No Less Successful in the Fight against Poverty," Policy Research
Working Paper, no. 4703 (August 2008), World Bank Development Research Group, http://go.wxorldbank.
org/BXEZCODA10.

THE BROWN JOURNAL OF WORLD AFFAIRS

Role Moded and Policy Rights

NOTES
1. This article is based on a book in progress entitled, A Farewell to Theory: Developing From Role
Models.
2. As is well known, growth rates in India and China soared in the later period, noted later.
3. In 1938, Mexico became the first developing country to nationalize its oil industry.
4. Argentina's first European multinational, Pirelli, established a subsidiary in 1917 that survives
today'
5. Alice H. Amsden, Escape from Empire: Te Developing Vorld ourney brough Heaven and Hell
(Cambridge: MIT Press, 2007).
6. Mature high tech refers to innovative products that are already being sold in world markets but
whose demand is still growing fast. Alice H. Amsden and W W Chu, Beyond Late Development. Taiwan'
LUpgradingPolicies (Cambridge: MIT Press, 2003).
7. Alice Amsden, Farewellto 7heory: Developingfom Role MWodels (Cambridge: MIT Press, 2010),
8. Third World Network, "India submits proposals on strengthening the WTO," SUNS 6739, 13 July
2009.
9. Fatoumata Jawara and Aileen Kwa, Behind the Scenes at the WTO: The Real World ofInternamtional
Trade Negotiarins (London: Zed Books, 2003).
10. Third World Network, "WTO head Pascal Lamy rebuffed on own pay rise attempt," SUNS 6743,
17 July 2009.
11. Alice H. Ansden, Escapefrom Empire: The Developing Worldi journey brough Heaven and Hell
(Cambridge: MIT Press, 2007).
12. E. Herbert Norman, Japan' Emergence as a Vodern State (New York: Institute of Pacific Relations,
1940).
13. Alisa di Caprio, "'The Impact ofAsymmetric Free Trade Agreements on Middle-Technology Developing Countries" (doctoral dissertation, MIT Department of Urban Studies and Planning, 2007).
14. Alice IH. Amsden and Takashi Hikino,"The Bark is Worse thanr the Bite: New' TO Law and Late
Industrialization," The Annalh of theAmeran Academy ofPoliticaland SocialScience 570, no. 1 (2000).
15. The term is attributed to President Dwight D. Eishenhower, former Five-Star General, in his farewell
address to the American nation on 17 Januar' 1961.
16. Mark Landler, "Treasury's Lead Role in China in Flux,' New York Times, 1 December 2008.
17. "U.S. Fact Sheet: Fifth Cabinet-Level Meeting of the U.S.-China Strategic Economic Dialogue,"
U.S. Treasury Department, 5 December 2008.
18. A 1985 study anticipated the continuation of state economic interventionism under a liberal world
economy. Peter B. Evans and Dietrich Ruescheineyer, Bringingthe State Back In (Cambridge: Cambridge
UP 1985).
19. Data are from University of Michigan (UMI) statistics on Ph.D. dissertations completed in the
United States. Data were collected by Joo-Young Kwak, who used discretion to decide if a thesis was written by a Japanese national, Korean national, or Korean American (excluded from data).
20. Statement by Yevgeny Kuznetsov, who collected data for Russia. Data were collected for other
countries as follows: Korea, Joo-young Kwak and Kyung-Min Nam; Brazil, Mansueto Almeida; India,
Rajendra Kumar; and China, Jinhua Zhao. All based on published or unpublished government data.
21. Amartya Sen, Developmentas Freedom (New York: Anchor Books, 2000): 35-36.
22. "Rural Electrification in China 1950-2004," Stanford University Program on Energy and Sustainable Development Working Paper no. 60 (December 2006),
23. Poverty rates fell fastest in East Asia, with few grass roots volunteers, to only 18 percent in 2005
from a level estimated to have been 80 percent in 1981, when Asia was the world's poorest region. The
comparison between "fierce" China and "friendly" India tells the same tale. The number of people in
China living in poverty fell to 207 million in 2005 from 835 million in 1981, while there was an increase
in poverty in India, from 420 million in 1981 to 455 million in 2005.
24. Jean Baptiste Say, a nineteenth century economist later discredited by Keynes, proposed a law, now
called Say's Law, to the effect that under full employment, markets act in such a way that an economy's

FALL/WINTER 2009 * VOLUME XVI, ISSUE I

215

ALICE AMSDEN
production will all be bought, without any unsold inventory.
25. Sen.
26. ILO LABORSTA, http://laborsta.ilo.org.
27. Alice H. Arnsden, "Says Law, Poverty Persistence and Employment Ne glect,"
Development and Capabilities11, no. 1 (2010).

216

THE BROWN JOURNAL OF WORLD AFFAIRS

fournal ofHuman