The Five-Phases of Economic Development and Institutional Evolution in China and Japan

Masahiko Aoki

Development Economics Working Papers from East Asian Bureau of Economic Research

Abstract: Based on the variable rate of gross domestic product per capita growth and its sources, this paper first identifies five phases of economic development that are common to China, Japan, and Korea : M (Malthusian), G (government-led), K (à la Kuznets), H (human capital based) and PD (post demographic-transition). But there are also marked differences in the onset, duration, and institutional forms of these phases across these economies. In order to understand these differences, this paper explores the agrarian origins of institutions in Qing China and Tokugawa Japan (and briefly ChosŠn Korea) and their path-dependent transformations over those phases. In doing so, the paper employs game-theoretic reasoning and interpretations of divergent institutional evolution between China and Japan, which also clarifies the simplicity of prevailing arguments that identify East Asian developmental and institutional features with authoritarianism, collectivism, kinship-dominance, Confucianism and the like. Finally, the paper examines the relevance of the foregoing developmental discussions to the institutional agendas faced by China and Japan in their respective emergent phase-transitions. In what way can China avoid the “middle income trap†? What institutional shortcomings become evident from the Fukushima catastrophe and how can they be overcome in an aging Japan?

Keywords: phases of economic development; institutional forms; Institution; game-theoretic reasoning; path-dependent (search for similar items in EconPapers)
JEL-codes: J11 N15 N35 N55 O15 O43 O53 P51 (search for similar items in EconPapers)
Date: 2011-12
New Economics Papers: this item is included in nep-dem, nep-dev and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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Related works:
Working Paper: The Five-Phases of Economic Development and Institutional Evolution in China and Japan (2012)
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