Sorry, but your view is wrong. If you can back it up with info from authors like Amsdem, then maybe I’ll believe you. You were able to cite authors in rebutting my arguments. Why cant you do the same with respect to the views of SyCip on democracy? Sorry but that quote from hvrds doesnt qualify. – Anthony Scalia

As requested. Here is what economist Dani Rodrik has to say in his paper on Democracy and Economic Performance.

While East Asian countries have prospered under authoritarianism, many more have seen their economies deteriorate—think of Zaire, Uganda, or Haiti. Recent empirical studies based on samples of more than 100 countries suggest that there is little reason to believe democracy is conducive to lower growth over long time spans.3 Neither is it the case that economic reforms are typically associated with authoritarian regimes (Williamson 1994). Indeed, some of the most successful reforms of the 1980s and 1990s were implemented under newly-elected democratic governments—think of the stabilizations in Bolivia (1985), Argentina (1991), and Brazil (1994), for example, or of the Polish transition from socialism.

Should we be agnostic then about the economic implications of democracy? Since civil liberties and political rights have intrinsic value independent of their economic consequences, it is good to know that fledgling democracies do not necessarily face any tradeoffs. But there is more to be said on behalf of democracy.

As I will demonstrate in this paper, democracies perform better than authoritarian regimes in a number of respects which have received scant attention to date. I will show four results in particular:
1. Democracies yield long-run growth rates that are more predictable.
2. Democracies produce greater stability in economic performance.
3. Democracies handle adverse shocks much better.

The entire paper is available in the web. Just google.

cvj,

wait, did i ever insinuate that the IT industry of India was the main driver of Indian growth?

I pointed out to the indian offshoring industry as the best example of self-started and self-driven industry without the benefit of a government aid. And that the policies just caught up with the industry.

When asked why did they choose IT, these Indian entrepreneurs said that because they had no choice, as IT was (then) the only business they could form without going through government red tape.

The ‘policies’ that caught up were the policies relevant to the Indian offshoring industry. Take note that phrase was on the same paragraph. Kindly refer to that paragraph. I was not referring to the whole Indian economy.

The Indian National Dept of IT was formed when India’s IT and IT-enabled services prowess became obvious. This Department really helped the industry further. But such prowess could not have surfaced if not for the initial efforts of the Indian entrepreneurs.

Imagine if the size of the Philippine offshoring industry is the same as that of India. It may not be enough to cause the Philippine economy to leapfrog, just as the Indian offshoring business may not make a dent to India’s over-all economy, but at least you have millions less unemployed to worry about.

My over-all point has been – we need more Pinoys like those Indian self-starters. The problem is, Pinoys are either migrating or thinking of ‘patalsikin na now na’

And removing the chief executive will not usher in economic development.

I wonder where did you get ‘the dismantling of the IT sector’?! For your benefit, you may want to check the history of the Indian IT giants Infosys and Satyam, as it will also give a history of the Indian IT industry. Then you can verify if ‘dismantling of the IT sector’ is accurate or not.

And may I remind you that your quotation from Dani Rodrik and Arvind Subramanian actually helps my argument. (Take note, the ‘policies’ that caught up refer to the offshoring industry, not general policies).

They argue that what triggered the real growth was whewn the government became pro-business. The entry of Suzuki was mentioned – a private sector activity.

Accept it, policies do help, but private sector involvement is what brings the money in. Pinoys still suffer from the malady of waiting for the right policies before doing anything.

By the way, Rodrik and Arvind put it well, “…rapid economic growth is attainable under appropriate policies.”

Not removing chief executives.

How can we expect government to come up with policies if the Senate wastes its time on investigations that are irrelevant to the needs of the country? Thats not being pro-business!

“First of all, we cannot both be correct so if i believe i’m right, then Washington Sycip must be wrong and vice-versa”

Sorry, but your view is wrong. If you can back it up with info from authors like Amsdem, then maybe I’ll believe you. You were able to cite authors in rebutting my arguments. Why cant you do the same with respect to the views of SyCip on democracy? Sorry but that quote from hvrds doesnt qualify.

“I suppose you mean Amsden.”

Ah yes, Amsden.

“No need for that since i’m familiar with the elitist mindset.”

Oh really? Sorry but you don’t.

“Washington Sycip wants a dictatorship because he believes it would give arbitrary powers to technocrats like him which would speed up formulation and facilitate the execution of his favored policies.”

Maybe mlq3 can help verify this – Washington SyCip was at best a government adviser. He never occupied a government position, just those 1-peso a year advisers IIRC.

Maybe it didnt occur to you that Washington SyCip was pro-business all along – like the indian government in the 1980s, as per Rodrik and Arvind?

“This despite the fact that our biggest economic downturn in our history happened when technocrats like him (Cesar Virata and Jobo Fernandez) were given free hand by the dictator Marcos. Haven’t we already learned this lesson?”

SyCip never occupied any government post, much less a policy-making post. What makes you think that if SyCip were given a post, he would do as poorly as Virata and Jobo? And are you sure Virata and Jobo were given a ‘free hand’? During Marcos’ time, nobody had a ‘free hand’!

“Their political leaders don’t have the same legitimacy issues as their Filipino counterparts”

implied answer – no, the rallies in India that you saw were not on removing chief executives. and how sure are you that their leaders do not have legitimacy issues?

“The absolute value of the GDP which you refer to above is different from the rate of GDP growth which i said was important”

Hey hey, you only said

‘rate of GDP growth was important’

after i gave that statement that

‘Well that’s another deadlock. and that makes the Philippines better than India, and just a striking distance off China. Hey that should be shouted from the mountaintops and bannered in headlines – the Philippines is better than the global leader in offshoring, India!’

which is my reply to your earlier statement that

‘Actually no. What matters is per capita GDP’

because the per capita GDP of the Philippines is bigger than India’s.

it ignores the often bloody confrontations between the koreas and their authorities. – mlq3

I pointed to the “the Kwangju massacre where 200 pro-democracy protesters belonging to the workers movement were killed and 1000 injured.”

it ignores that park chung hee was assassinated. – mlq3

You’re right, i should have brought that up as i did in a previous exchange with Ca T on this topic.

Just because it differs with your view, it is already in error? – Anthony Scalia

First of all, we cannot both be correct so if i believe i’m right, then Washington Sycip must be wrong and vice-versa.

I hope you can back it up with authors like Alsem. – Anthony Scalia

I suppose you mean Amsden. No need for that since i’m familiar with the elitist mindset. Washington Sycip wants a dictatorship because he believes it would give arbitrary powers to technocrats like him which would speed up formulation and facilitate the execution of his favored policies. This despite the fact that our biggest economic downturn in our history happened when technocrats like him (Cesar Virata and Jobo Fernandez) were given free hand by the dictator Marcos. Haven’t we already learned this lesson?

Really, please pray tell me what are the rallies for. The resignation of the president? The prime minister? – Anthony Scalia

Their political leaders don’t have the same legitimacy issues as their Filipino counterparts.

‘If you can show that the GDP of Taiwan is bigger than the Philippines’ in 1980 then I stand corrected’ – Anthony Scalia

The absolute value of the GDP which you refer to above is different from the rate of GDP growth which i said was important.

But what exactly are those “appropriate” policies that made the Indian miracle possible? The
conventional story about India, which can be glimpsed in any number of policy-oriented papers and newspaper articles, goes like this. Until 1991, India’s policy makers followed misguided policies that closed the economy to international trade, erected inefficient industries under state guidance, riddled the private sector with extraordinarily cumbersome and detailed regulations, and suffocated private economic activity with controls and bureaucratic impediments. Then in 1991, the big breakthrough happened. Spurred by a balance of payments crisis, Indian policy makers turned to technocrats such as Manmohan Singh, who promptly began the process of liberalizing the economy. Trade barriers were slashed, foreign investment was welcomed, the license raj was dismantled, and privatization began. The economy started to boom, with software exports and call centers leading the way.

Like all caricatures, the above story has elements of truth in it. It is indeed the case that until recently India had one of the most over-regulated and closed economies of the world. It is also true that the economic liberalization of 1991 constitutes a watershed event for the Indian economy. But the main difficulty with the standard account, as summarized above, is that the pick-up in India’s economic growth precedes the 1991 liberalization by a full decade. Even a cursory glance at the growth record reveals that the more-tha -doubling of India’s growth rate takes place sometime around 1980, with very little discernible change in trend after 1991. In fact, some indicators, such as economy-wide total factor productivity, even go in the “wrong” direction, showing a deceleration after 1991. Therefore, the striking post- 1980 improvement in performance can not be attributed to the liberalization of 1991. The latter may well have played a role in sustaining and deepening an ongoing process of growth, but we need to look elsewhere than the reforms of 1991 to understand how India made the transition to high growth. A related implication is that more recent phenomena such as the boom in IT and related services cannot have been the original source of India’s economic growth.

Anthony’s claim that Indian policies simply caught up with the already growing offshoring industry is not historically accurate since the basic policy change (what they call government’s ‘attitudinal shift’) and the growth acceleration tooke place a decade earlier. In explaining the source of India’s growth acceleration the authors explain that distinction between pro-market and pro-business.

We would stress that our characterization of the 1980s reform is not about whether“liberalization” took place but about how it happened. Some accounts of of the 1980s point to the easing of access to foreign technology, to foreign capital goods, and to foreign direct investment (with the entry of Suzuki into the domestic car market as the most telling example) as examples of “liberalization.” To us, these reforms in the 1980s, were not proliberalization but pro-business in the important sense that they served to boost the profits of existing businesses without threatening them with real competition. Allowing a single foreign firm, Suzuki, to enter the domestic car market under existing conditions of limited external liberalization (and subject to local content requirements) is very different from opening the domestic car market to all foreign producers, which is the normal liberalization strategy and 20 the approach adopted in the 1990s.25 This pro business rather than pro-market/procompetition o ientation manifested itself in the greater focus on “internal rather than “external” reforms. In addition, even the internal reforms which favored business were slanted more toward favoring pre-existing activities rather than facilitating new businesses (i.e., through entry by domestic firms). This approach had the political economy merit of avoiding the creation of losers. And it appears that the economic impact of favoring existing activities, which must have entailed some inefficiency, was not only not negative but actually positive. This is reflected in the fact that the growth of the 1990s also appears to have taken place in states with a large initial share of registered manufacturing, some of it built up during the 1980s. Thus, India’s “reforms” in the 1980s, which essentially amounted to more import substitution, were attractive from a political economy perspective because they created virtually no losers. This is reminiscent of China’s reforms as well, although the latter obviously took on a very different form.

To use Anthony’s term, it’s again more of that ‘dirigist ek-ek’.

Now the question is, where did these existing businesses come from in the first place? For that, we have to look to Alice Amsden’s account on the Indian government’s reciprocal control mechanisms (which included the much-maligned license-raj).

noted. it stops there.

“That’s an inacurrate characterization of the Marcos years.”

No, what i wrote was very accurate.

———————————————————-

“There was entrepreneurial/business activity at that time but the difference is that the Marcos government did not implement policies similar to that of South Korea which led to the rise of the Chaebols in the latter’s case.”

No, entrepreneurial activity was not enough to produce Korea-like results. The policies were there, there was just a few takers. And the quest to migrate was already there.

———————————————————-

“That is a truncated and strawman understanding of the opposition to GMA”

No it is not. Just a picture of reality, and the misplaced priorities of many.

———————————————————-

“The issues against Gloria Arroyo are her lack of legitimacy (aka her cheating) and her undermining of our institutions that we need as the basis for a functioning society.I don’t think the private sector can do its part if the Philippines is on its way to becoming a failed state”

Lets go back to Park Chung Hee’s time. He has ‘undermined the institutions’ of his country. Yet how come when democracy was restored in 1987, Korea was very rich. Compared to the Philippines post EDSA 1. Prior to 1987, it can be said that Korea was a failed state.

Face it, we don’t have enough patriotic, entrepreneurial countrymen that see beyond GMA. What we have are Pinoys still thrilled by the romanticism of people power removing a President.

———————————————————-

“Then Wikipedia (specifically the one who wrote that passage) is making the same attribution error as you and Washington Sycip.”

Sorry to say, no, that was not an error. Di mo lang matanggap ang statement ni Washington SyCip. Did it ever occur to you that SyCip has survived more presidents than anyone else, has been in the Philippine business scene actively since the 1950s? That if there is anybody who has the credibility to say something definitive about the Philippines, it is Washington SyCip?

Just because it differs with your view, it is already in error? I hope you can back it up with authors like Alsem.

———————————————————-

“While there are countries that prospered under dictatorships, there are also countries like us that stagnated under one”

Agreed.

———————————————————-

“what matters, aside from per capita GDP, is the rate of GDP growth”

i refer you to my query to you earlier:

‘If you can show that the GDP of Taiwan is bigger than the Philippines’ in 1980 then I stand corrected’

to which you replied with a one-liner:

‘Actually no. What matters is per capita GDP.’

———————————————————-

“Not true. While i was in India, i saw that they also had rallies”

Really, please pray tell me what are the rallies for. The resignation of the president? The prime minister?

———————————————————-

“Both India and the Philippines have a large pool of people working overseas and both have a large immigrant community in the West”

Agreed. But in terms of number of returnees, Indians lead Pinoys.

———————————————————-

“What India and South Korea have in common is that their governments were more successful in pursuing industrial policies that encouraged the growth of their private sector firms, i.e. what you refer to as ‘dirigist ek-ek’”

Asus, where do you think are the traces of the ‘national dirigist mercantilist’ policies you claim that the Indians and Chinese pursued?

If the Indian offshoring industry is an indication, insiders say that its a good thing their industry boomed in the mid 1990s, becauyse if the boom took place much earlier, the Indian government would have nationalized their industry. Indian policies simply caught up with the already growing offshoring industry.

Yes, the policies may have helped later, but the self-starting, diligent, resourceful and entrepreneurial Indians began their businesses without the benefit of policies.

Yan ang kulang ngayon sa mga Pinoy – those who are self-starting, diligent, resourceful and entrepreneurial. Pero how can we expect Pinoys like them to rise if all they do is either migrate or just think “patalsikin na now na”

And if wikipedia is authoritative, it said that one of the factors for the success of the East Asian tigers (includes Korea and Taiwan) is “Non-democratic and relatively authoritarian political systems during the early years.” – Anthony Scalia

Then Wikipedia (specifically the one who wrote that passage) is making the same attribution error as you and Washington Sycip. While there are countries that prospered under dictatorships, there are also countries like us that stagnated under one.

Its sad, but it seems nobody bothered to build companies and jobs during the Marcos years. The sole goal was kick out Marcos and restore democracy… – Anthony Scalia

That’s an inacurrate characterization of the Marcos years. There was entrepreneurial/business activity at that time but the difference is that the Marcos government did not implement policies similar to that of South Korea which led to the rise of the Chaebols in the latter’s case.

…Worse, the best and brightest all suffer the delusion that kicking out GMA is the sine qua non for prosperity a la Korea! So thats where the thrust is now, kicking out GMA, ‘dahil ginagago na tayo!” What a waste of talent and resources! – Anthony Scalia

That is a truncated and strawman understanding of the opposition to GMA. The issues against Gloria Arroyo are her lack of legitimacy (aka her cheating) and her undermining of our institutions that we need as the basis for a functioning society. I don’t think the private sector can do its part if the Philippines is on its way to becoming a failed state.

i thought you said what matters is per capita GDP? – Anthony Scalia

I guess you overlooked what i said above (at 1:09am):

what matters, aside from per capita GDP, is the rate of GDP growth.

no impeachments, no ‘EDSAs’, no people powers, no agitators, no “kami naman’ opposition, no rallies – Anthony Scalia

Not true. While i was in India, i saw that they also had rallies.

many Indians willing to sacrifice for their country, either by not migrating to a First World country, or returning home – Anthony Scalia

Both India and the Philippines have a large pool of people working overseas and both have a large immigrant community in the West.

many entrepreneurial Indians creating wealth for their country – Anthony Scalia

What India and South Korea have in common is that their governments were more successful in pursuing industrial policies that encouraged the growth of their private sector firms, i.e. what you refer to as ‘dirigist ek-ek’.