Industrialization Policies of Korea and Taiwan and Their Effects on Manufacturing Productivity

Okuda Satoru

The Developing Economies, 1997, vol. 35, issue 4, 358-381

Abstract: In this paper the total factor productivity (TFP) of the manufacturing sectors in Taiwan and the Republic of Korean was measured and compared using the growth accounting method. Through descriptive analysis, inefficiency in the Korean manufacturing sectors was revealed, especially for the period prior to 1986. Also for the period posterior to 1986, it was found that TFP tended to contribute more to the value-added growth in both countries. An econometric analysis with industrialization-related variables revealed a contrast in the structure of TFP growth between the two countries. Import penetration, capital intensity, and growth of real output were estimated to exert a positive productivity impact in Taiwan, reflecting Taiwan's flexibility and superiority in factor utilization compared with Korea. It was estimated that the export ratio did not have any major productivity impact in both countries, in contrast with the results reported by the World Bank (The East Asian Miracle: Economic Growth and Public Policy, New York: Oxford University Press, 1993).

Keywords: Industrialization; Industrial policy; Productivity; Manufacturing industries; South Korea; Taiwan; 工業化; 産業政策; 生産性; 製造業; 韓国; 台湾 (search for similar items in EconPapers)
JEL-codes: O14 O25 (search for similar items in EconPapers)
Date: 1997
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Citations: View citations in EconPapers (3)

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