INTRODUCTION

This chapter seeks to explain Malaysia's industrialisation in terms of the East Asian developmental state model. This “model” generally refers to a developmental state characterised by the capacity to manage the process of late industrialisation, specifically: 1) the transfer of resources to more productive groups and sectors; and 2) learning and “catching up”. In particular, the disciplinary capacity of the state to ensure that learning rents are not wasted is seen as central to successful late industrialisation. However, this capacity was rooted in historically specific social relations that reduced the need of the state to accommodate political opposition, whether this was a powerful landed class or organised middle class. At the same time, there were geo-political contingencies that provided the impetus to industrialise, supported by substantial amounts of US aid.

The question, then, is whether the East Asian developmental state can be transferred to developing countries, given its historical specificity. While it may be relatively easy to replicate the sorts of capacities related to making the correct economic decisions by improving the quality (and autonomy) of the bureaucracy, the political capacity of the state to implement decisions and enforce discipline is far more difficult to replicate because this will be contingent on political factors specific to a country. The notion of state capacity therefore needs to be understood in terms of historically specific social contexts, and in particular the balance of political forces that shape state motivations and constrain policy design and implementation.