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Beyond Late Development: Taiwan's Upgrading Policies. By Alice H. Amsden and Wan-wen Chu. Cambridge, Massachusetts: The MIT Press, 2003. Pp. 207.
Any study of a country's economic development should examine at least the major economic drivers and put them in their historical context. Amsden and Chu's use of Taiwan's electronics as well as modern services industries to illustrate Taiwan's economic development is a good example. In addition, they have carefully considered the extent to which the latecomer model can be generalized. The book should prove to be useful to both academics and policy-makers in opening up new ways of looking at economic development.
As the authors themselves contend, standard theories of the firm have to be adapted to explain latecomer upgrading. Amsden and Chu have forcefully argued the case for a different set of assumptions to be employed in explaining the latecomer firm (pp. 162-64):
* Competitiveness: The second mover must contend with low margins from producing mature products, concentrating on cumulative skills that enables the firm to ramp up fast in order to exploit scale economies. The...