Current research represents a comprehensive analysis of the academic article devoted to the issue of globalization impact on Taipei’s infrastructure, restructuring and general economic development. Our research is subdivided into two interconnected parts. The first provides a thorough examination of the article’s main theoretical underpinnings, assumptions and final findings. The second section of analysis is devoted to the critiques of the abovementioned article which is to reveal its biases, factual inaccuracies, stylist deficiencies, false interpretations and conclusions.
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The article under analysis addresses the social consequences and Taiwan’s response to the Asian economic crisis which was very destructive to its economy. The crisis is analyzed mainly as being produced by financial institutions and real estate speculation which caused badly damage for economic activity and extensive inflation.
The Taiwan economic crisis stimulated active movement of urban community and civil society representatives which sought to redress the situation. In authors’ opinion the main lesson of the Taiwan economic crisis is inability of the state to play a role of mediator between national economy/civil society and global capitalism which becomes increasingly postindustrial and financial.
From the start it may be claimed that the notions that are used in this article are not properly motivated. The terms global informational capitalism should be regarded as an evident overestimation of the role informational technology plays in modern capitalist system. There is no denying the importance of the fact that the development of so-called post-industrial society in the West was made at the cost of outsourcing traditional industrial production to the developing countries. Moreover, to understand the nature of new capitalist mode of accumulation it is more appropriate to analyze this stage paying more attention to such phenomena as financialization which refer to the predominance of financial speculative capital in the structure of accumulation. Besides this it seems doubtful to describe the economic policy realized by Taiwan state in terms of developmentatlist paradigm as the authors do. In fact Taiwan is a model neoliberal state providing favorable climate for the foreign investments and companies and financial capital which includes low taxation, liberalization of capital flows etc.
Besides this Taiwan’s social policy can be described as neoliberal too. Job market and social guarantees are liberalized; the regulation of economy is reduced to monetarist policy and the control over inflationary forces.
Hence it may be claimed that the basic assumptions and theoretical underpinnings of the paper are not properly developed.
What concerns empirical analysis presented in the paper which mainly refers to the analysis of overall Asian crisis and the particular Taiwan’s response to it, it seems to us that it is quite relevant and properly grounded.
Firstly, the general frame of Asian crisis analysis is introduced with the focus on its social and economic consequences in such South-East Asian countries as South Korea, Thailand, Indonesia. Secondly, different views and interpretations of the Taiwan’s economic crisis and government’s response to it are provided. There is no denying the importance of the fact that the Cheng and Hsia gave a comprehensive overview of different scholars and stakeholders opinions on the scope of economic crisis in Taiwan. Among them the most notable are those claiming that ‘tough consequences’ were avoided by strict developmentatlist policies of Taiwan’s government which restrained massive liberalization and financialization; the opinion expressed by a group of analysts which claimed that the difficulties were avoided due to corruptive nature of Taiwan’s bureaucracy; the opinion suggesting that on the contrary Taiwan vigorous and sound economic development was a main cause of crisis preemption and finally a position claiming that the crisis was not in fact avoided.
Two authors of the discussed article suggest that they do no have any ambition to engage into debate with these scholars and politicians but rather want to analyze the Taiwan’s crisis proceeding from the difficult interrelation of globalization and the policies of Taiwan’ s state. First of all, they rightly suggest that the Asian miracle was partly stimulated by the formation of developmental model of state in 60s and 70s which was then destructed by global financial forces. As Cheng and Hsia claim, ‘As Asian economies grew, pressures began to build for financial and trade liberalization in this region to accommodate the fast expanding global money market’. These developments resulted in the significant economic problems including the devaluation of Taiwan’s currency in relation to American dollar and the growth of inflation which challenged the interests of small enterprises and Taiwanese populace. According to the authors, Taiwan government abandoned its developmental agenda in tackling this situation and implemented economic agenda prescribed by IMF and other international financial institutions which centerpiece can be described as restrictive economic policies directed at maintaining favorable investment climate for foreign capital. Therefore, as authors rightly note the preconditions for crisis were already in place when it occurred.
In what follows the authors provide an interesting analysis of civil society activism against the neoliberal policies of the state with a particular emphasis on urban movement. It seems to us that Cheng and Hsia overstate the significance of civil society actions against neoliberal policies. Civil society develops its agenda in the frames of institutional consensus which comes short of addressing the main reasons of neoliberalism. The civil society activists claim that they can foster the formation of just system of governance and economy. However, the main cause of neoliberalism which is the dependence of national economy on the aggressive expansion of financial capital and political dependence on the hegemonic powers is not addressed in their agenda.
To sum it up, the article written by Cheng and Hsia includes both positive and negative elements which we addressed. One of the main advantages of this research is a comprehensive analysis of Taiwan economic crisis. Ungrounded and weak claims may be found in the authors’ analysis of its causes and the approaches for its resolution.
Cheng, Lucie and Hsia, Chu-joe. ‘Asian economic crisis, state policy, and urban movements: a Taiwan version’ Asian Geographer 19(1-2): 63-73, 2000.