Government Direction And Policy Case Study

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How important has government direction and policy been in the economic development and export success in countries of the Asia-Pacific region?
The level of economic development and export success in the countries of the Asia-Pacific region is a phenomenon which many theorists have attempted to explain. Concerning whether or not there exist a significant relationship between government policies and such regional economic success, I argue that government direction and policy has been critically important to facilitating the economic success of the region, particularly where private investment is lacking. Such a position can be substantiated through reflecting over the set readings of the course, and as such this reflective piece will discuss
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Importantly, in this article Beresford discusses the important concept of ‘alliance capitalism’, which is the term used in reference to government policies aimed at providing direct state guidance to the market as opposed to policies aimed at simply facilitating market operations (2008: 223). Therefore, alliance capitalist policies are often interventionist in nature with the state maintaining a heavy role in determining market operations and investments (Beresford 2008: 223-225). Alliance capitalism, as argued by Beresford, is critical to inducing long-term structural changes to any given country’s economy, especially for developing economies (2008: 224). This is the case as in developing economies, investment decisions without state guidance would typically only serve to “perpetuate existing structures” and not lead to any major industrialisation (Beresford 2008: 225). I believe this conclusion to be sound on basis that often long-term investments, particularly in developing economies, typically require state investment as I would expect private and/or foreign investors would be wary to the risks of the developing country, which may be perceived to lack stability or have high levels of corruption for …show more content…
Green argues that there are a number means through which government policy can encourage increased levels of investment (2007: 16-20). The first measure is through the government providing adequate infrastructure and providing basic utilities such as electricity, water, sanitation and transport services (Green 2007: 24-25). As noted by Green, underinvestment in infrastructure can have economic costs as was the case in the Philippines, where power outages were estimated to costs the economy billions per year (2007: 24). To develop infrastructure, Green argues that public sector resources are often required as often there is no real equivalent to the resources of government in comparison to the private sector, particularly in developing economics (2007: 24). This relates fundamentally to the concept of alliance capitalism in relation to the ability of government in ensuring long-term structural investments are funded, as discussed by Beresford. In addition to infrastructure, Green argues that the state plays a critical role in encouraging investment due to its ability to set the national policy agenda, build long-term confidence for foreign investors, commit to structural reforms to reduce the

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