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17 Cards in this Set

  • Front
  • Back

Japan Miracle Period

Taiwan Take off?

Sth Korea take off?


Early 60's

Mid 60's

Communes (renmin gongshe)

1958-78. Result of Great Leap Forward, Mao Zedong. Private cooking band, replaced by communal cooking and kitchens. Everything communal. Everyone assigned jobs.

Decision to collectivize before mechanisation

- Initially too large, poor fit with existing market areas, by 1963 smaller.

Work incentives poor. Very high rate of investment 25%.


Township and village enterprises: refers to companies located in townships and villages. Flexible in ownership structure. Many communally owned.


Shows virtual integration

MB= Main Bank

Sogo shosha

Arrow bottom right mutual shareholdings

Financial Keiretsu

The Big 6 1951-67 to Heisei Recession to 1992 or present.

(Mitsubishi, Mitsui, Sumitomo, Fuyo / Fuji, Sanwa, Dai-Ichi, Kangyo)

Invulnerability to takeover. Ignore share price and means they dont need to pay dividends.

Guaranteed finance from main banks over loaning.

Capital Keiretsu

Core firm + Subcontractors

Post-WW2 till today.

Miracle growth uses large firms

Benefits of vertical integration without the risks.

Western firms renegotiate more often so less trust.

90's started to break down as protection of SC stopped.


State owned enterprises. Centrally owned, or at a provincial or local level. China mainly Medium sized firms (1000+ workers). Communes country sides, cities big SOE's. Not as successful as communes.

SOE's retain 30-50% share of economy.

Technology transfer.

SOE Cont.

Financial losses, big drain on big 4 banks. Feared crash in 1980's. Massive over-investment, especially in steel cement etc.

POST 1978.


Sogo Shosha

Means General Trading Companies

Meiji period-today. Large trading companies, survived, thrived best within zaibatsu.

Mitsui. Mitsubishi. Sumitomo, Marubeni, Itochu Toyota Tsusho and Sojitz.

Neo-Classical View?

Dominent since 70's

Free markets, Small Gov

Keynesian view?


Big Government to interfere in the governmnet. (Structuralist)

Clear evidence of high state intervention in East Asia Miracles.

EOI, ISI or pure free?

Export Oriented Industrialisation

Open to Imports, subsidise exports



Meiki period until 1945

Gov Patronage, Bank Ownership.

Holding co. controlling large firms in heavy industry and finance.

Mitsui Mitsubishi Sumitomo and Yasuda

Top four control 25% of economy.


Golden Age after banking crisis of 1927.

Transaction costs - 4 Elements?

1. Transaction-specific investments

2. Opportunism (moral hazard or cheating) TSI above creates opportunity for

3. Information costs - Contracting, Monitoring contracts, Market research, errors in market research, seeking suppliers.

4. Some sort of structural response to 1,2,3 e.g vertical integration, gufen companies, guanxi.

Zaibatsu diagram??

Capital Keiretsu diagram