Transcript Culture and Economy: Toward An East Asian Model?

Culture and Economy:
Toward An East Asian Model?
Allison Gleue
Why Are Cultural Factors
Sometimes Ignored?
• Underlying assumptions of economics
• Danger of stereotypes
• More difficult to provide hard empirical
evidence
Does Culture Explain
Development?
• Some analysts have blamed any trend in
the Asian economy on Confucian or Asian
culture
• Weber blames Confucian culture for early
lack of development in China
• Tai and others link Confucian culture to the
development of Japan and the 5 tigers
• Some analysts blamed Confucian culture
for 1997 crisis
Positive Attributes of Asian Culture
for Development (Dore)
• “Will to Develop” compared to Latin
America
• Advantages of backwardness
• Attitudes towards Authority
• Social Cohesion
• High levels of interpersonal trust
• Desire to understand new technologies
Weber-Parsons Paradigm
• Asian Economic Development – human
emotional bonds, group orientation,
harmony
• Western Economic Development –
efficiency, individualism, dynamism
• Weber’s Protestant Work Ethic
Weber-Parsons Paradigm
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Affectivity v. affective neutrality
Self-orientation v. collective orientation
Universalism v. Particularism
Achievement v. ascription
Specificity v. diffuseness
The Affective Model
• Cultural explanation of why East Asia is
economically successful
• Claims Westerners do not properly understand
Confucianism
• Human Relations above all else
• Family
• Company
• Personal Savings
• Human Resources
Family
• Family loyalty the basis of society – the nation
viewed as extended family
• Confucian code explains how each member of
the family would act towards each other
• Most businesses owned and operated by
families
• Unrelated individuals often absorbed into
business/family structure in Japan – Lemoto
principle
Company Structured Like Family
• Paternalism
• Large bonuses for performance, seniority pay
scale, evaluations based on loyalty
• More fringe benefits and social activities
• Employees expected to share feelings and
participate in each others lives
Personal Savings
• Highest in savings to GDP ratio in world
• Increases business investment and
restrains inflation
• Confucian values encourage production
while discouraging consumption -EOI
Investing in Human Resources
• Confucius writings emphasized value of
universal education
• Intellectuals socially esteemed
• Tradition of meritocracy in civil service
• Companies invest in employees
• More engineers
Critiques of Cultural Approach
• Berger, Gross National Product and The
Gods
-Argues that capitalism is conditioned by the
society in which it operates
-Economic culture can create time-specific
comparative advantages
-If culture is the determining factor then East
Asian model not exportable
-External factors affect culture
Critiques of the Cultural Approach
• Fukyama, Asian Values and Asian Crisis
- Potential to be used an as excuse for
autocracy/human rights violations –
universalism v. relativism
- Confucianism can be interpreted many
ways – is it religion or culture?
- Ignores huge cultural variations among
East Asian countries
Discussion Questions
• What are the advantages and
disadvantages of cultural explanations?
• How much does culture matter in
determining the potential for economic
growth in a country?
• Do you think the rational model or the
affective model are applicable to other
developing countries?