4 ms·

isn't firm growth just a symptom of the issue? which i guess the article is describing. sometimes i feel like the best short-term path forward for a poor count

isn't firm growth just a symptom of the issue? which i guess the article is describing. sometimes i feel like the best short-term path forward for a poor country is just to have some kind of heavy handed gov't (like a "benevolent" dictator, hear me out lol) dictate policy and brutally subsidize and consolidate industries. of course you have to magically do this this with minimal fallout from corruption and then somehow make the transition to more of a democratic model. debatable if this nets out positive in the long run for the average citizen, but it will make your country "rich" (looking at you south korea). US is unique in this regard in that we have these huge firms and can also foster an environment for small/med to make that transition, although it's changing as well.

antihipocrat 2y ago
Sounds like Singapore.. without the transition to a more democratic model. Living standards there indicate it's been net positive for quite a long time.
- ENGNR 2y ago
  And South Korea
  - throwaway2037 2y ago
    > without the transition to a more democratic model Are you saying that SK has not transitioned to a more democratic model since their colonial independence in 1945? I beg to differ. SK is not SG. Yes, I know they have chaebols. Since their transition in ~1988 to a full democracy, the President and parliament (whatever they call it) have certainly shifted between multiple parties -- peacefully. If you study the development of democracies, this is an important step to a long-lasting, mature democracy.
- gruez 2y ago
  What type of industries were consolidated/subsidized in singapore? My impression is that they had the advantage of being a liberal financial center, whereas all their neighbors were not.
  - accurrent 2y ago
    Yeah the government does not disturb businesses here much. But they do heavily subsidize corporate costs. Theres a economic development board that provides lot of grants for companies. Most mncs use edb grants for setting up their initial business. Early on in Singapores history, the government did seize a lot of land from farmers though. I believe they were compensated for it. We also have these weird things called GLCs. China sort of copied this with their telecom industry. GLCs are corporations created by the government to handle certain things. They kind of have government level powers but corporate governances (worst of both worlds imo).
  - throwaway2037 2y ago
    I am an armchair economist regarding SG, but I would that say semiconductor manuf has been heavily subsidised by the gov't. As I understand, the "one trick" is to "get the plant built". They do whatever it takes to get the next plant built. Once built, it is very hard (economically) to stop running a semiconductor plant. This creates long-lasting, genuine economic growth for SG. Also, their petro-chemical industry is surprisingly large for a tiny country. I'm not talking about the simple trading of crude oil and gas; I'm talking about real value add by refineries and chemical plants. Again, I am not an expert here, but I assume that the SG gov't provided handsome benefits to the global supermajors to build huge refineries and chemical plants.
- accurrent 2y ago
  Im not sure about how much the dictator part is nessecarily true. For one when singapore was independent it was already wealthier than its neighbours. PAP loves telling us how theyre the best thing on earth, but Im not convinced. LKY did a lot of reforms but where practical he left colonial infrastructure as is. FDI and luck are also a big part of Singapores growth story. Singapores success was mirrored by china in the 2000s. The trick was free market capitalism with socialist political policies (in both cases). Also singapore has mastered the art of Government linked corporations - something that china copied. From 2000-2012 China probably had one of the least dictatorial governments in its history. Adding a dictator back in the mix has slowed growth although i wonder if thats a symptom of slower growth.
- logicchains 2y ago
  Singapore got rich because so many foreign firms moved there to use it as their base of operations. That isn't a scalable approach for a larger countries (Singapore's population is only around 5 million) that can't rely on foreign firms to supply all their jobs. In terms of producing successful local firms Singapore has actually been quite unsuccessful.

antihipocrat 2y ago

Sounds like Singapore.. without the transition to a more democratic model. Living standards there indicate it's been net positive for quite a long time.

ENGNR 2y ago
And South Korea
- throwaway2037 2y ago
  > without the transition to a more democratic model Are you saying that SK has not transitioned to a more democratic model since their colonial independence in 1945? I beg to differ. SK is not SG. Yes, I know they have chaebols. Since their transition in ~1988 to a full democracy, the President and parliament (whatever they call it) have certainly shifted between multiple parties -- peacefully. If you study the development of democracies, this is an important step to a long-lasting, mature democracy.
gruez 2y ago
What type of industries were consolidated/subsidized in singapore? My impression is that they had the advantage of being a liberal financial center, whereas all their neighbors were not.
- accurrent 2y ago
  Yeah the government does not disturb businesses here much. But they do heavily subsidize corporate costs. Theres a economic development board that provides lot of grants for companies. Most mncs use edb grants for setting up their initial business. Early on in Singapores history, the government did seize a lot of land from farmers though. I believe they were compensated for it. We also have these weird things called GLCs. China sort of copied this with their telecom industry. GLCs are corporations created by the government to handle certain things. They kind of have government level powers but corporate governances (worst of both worlds imo).
- throwaway2037 2y ago
  I am an armchair economist regarding SG, but I would that say semiconductor manuf has been heavily subsidised by the gov't. As I understand, the "one trick" is to "get the plant built". They do whatever it takes to get the next plant built. Once built, it is very hard (economically) to stop running a semiconductor plant. This creates long-lasting, genuine economic growth for SG. Also, their petro-chemical industry is surprisingly large for a tiny country. I'm not talking about the simple trading of crude oil and gas; I'm talking about real value add by refineries and chemical plants. Again, I am not an expert here, but I assume that the SG gov't provided handsome benefits to the global supermajors to build huge refineries and chemical plants.
accurrent 2y ago
Im not sure about how much the dictator part is nessecarily true. For one when singapore was independent it was already wealthier than its neighbours. PAP loves telling us how theyre the best thing on earth, but Im not convinced. LKY did a lot of reforms but where practical he left colonial infrastructure as is. FDI and luck are also a big part of Singapores growth story. Singapores success was mirrored by china in the 2000s. The trick was free market capitalism with socialist political policies (in both cases). Also singapore has mastered the art of Government linked corporations - something that china copied. From 2000-2012 China probably had one of the least dictatorial governments in its history. Adding a dictator back in the mix has slowed growth although i wonder if thats a symptom of slower growth.
logicchains 2y ago
Singapore got rich because so many foreign firms moved there to use it as their base of operations. That isn't a scalable approach for a larger countries (Singapore's population is only around 5 million) that can't rely on foreign firms to supply all their jobs. In terms of producing successful local firms Singapore has actually been quite unsuccessful.