Tuesday, January 29, 2008

Bad Samaritans

"Bad Samaritans

By Ha-Joon Chang

Bloomsbury Press, 288 pages

His new book is a discursive, well-written account of what he calls the “Bad Samaritans,” “people in the rich countries who preach free markets and free trade to the poor countries in order to capture larger shares of the latter’s markets and preempt the emergence of possible competitors. They are saying ‘do as we say, not as we did’ and act as Bad Samaritans, taking advantage of others who are in trouble.” “Bad Samaritans” is intended for a literate audience of generalists and eschews the sort of exotica that peppers most economic writing these days—there is not a single simultaneous equation in the book and many of Chang’s examples are taken from his own experiences as a South Korean born in 1963.

Ha-Joon Chang’s life is conterminous with his country’s advance from being one of the poorest on Earth—with a 1961 yearly income of $82 per person, less than half the $179 per capital income in Ghana at that time—to the manufacturing powerhouse of today, with a 2004 per capita income of $13,980. South Korea did not get there by following the advice of the Bad Samaritans. Chang’s prologue contains a wonderful account of how post-Korean War trade restrictions and governmental supervision fostered such projects as POSCO (Pohang Iron and Steel Co.), which began life as a state-owned enterprise that was refused support from the World Bank in a country without any iron ore or coking coal and with a prohibition on trade with China. Now privatized, POSCO is the world’s third largest steel company. This was also the period in which Samsung subsidized its infant electronics subsidiaries for over a decade with money made in textiles and sugar refining. Today Samsung dominates flat-panel TVs and cell phones in much of East Asia and the world. "

Please read the (long) review. Another one by dear Kirsten. Very pertinent to the next post... Looks like a great book.

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