The ability to realize productivity gains and increased efficiency at higher levels of technological sophistication is central to the sustainability of economic growth. Growth that occurs in the absence of productivity-enhancing adaptations depends on mobilizing increases in inputs—labor, capital, and natural resources—that are subject to significant environmental, social, and political limits. If firms, economic sectors, and countries fail to move up the “value-added” ladder of productivity-led growth, they will tend to end up squeezed between environmental and wage pressures, on the one hand, and the need to remain competitive, on the other.
Thus, finding a way to sustain growth through productivity gains has become a political as well as an economic imperative for the “second tier” of industrializing East Asian economies such as Thailand and Malaysia, caught between even lower-wage production locations and the first generation of Northeast Asian industrializers, which have moved successfully into higher-end innovation and production niches. Indeed, when labor and social unrest starts to affect countries such as Vietnam and China, the sustainability of growth models that depend on a seemingly infinite supply of low-wage, compliant labor and a willingness to view the physical environment as an inexhaustible reservoir of resources and a dumping ground for waste looks ever more problematic.
If the imperative for alternative sources of growth is fairly clear, actually achieving productivity-led growth is not an easy task. As Richard F. Doner argues in The Politics of Uneven Development, this is especially the case once the first stage of industrialization has run its course, and the gains from a shift away from labor-intensive agriculture to manufacturing have been exhausted. Doner convincingly shows that the specific tasks of industrial upgrading (including in agricultural industries) to achieve gains in productivity are complex and demanding. Drawing primarily from the New Institutional Economics, Doner identifies several collective action and other (particularly distributional) problems that confront both firms and governments. Resolving these challenges, he argues, requires not only particular institutional capacities in both public and private sectors, but also capacities that are in some crucial respects different from those necessary in the first stage of structural transformation and industry expansion.
The Politics of Uneven Development carries us forward from older debates about the political economy of development, which took successful industrialization as the main dependent variable, to more recent theoretical work in economics and political science. Two elegant and razor-sharp theoretical chapters provide a state-of-the-art synthesis of such work, and set out the book's independent contribution to this literature. In addition to a precise analytic specification of upgrading tasks and matching institutional capacities, the book draws attention to the political origins of institutional capacities, building productively on models of political coalitions and veto players.
The book tightly integrates this analytic framework with its presentation of Thailand's trajectory of uneven economic development—a combination of high growth with periodic significant slowdowns, of successful industrialization but more limited gains in technological sophistication, productivity, and innovation, and of intersectoral variation. In identifying market failures, collective action problems, and distributional conflicts, the book convincingly demonstrates its core propositions regarding the specific challenges of upgrading and sustaining increases in productivity. On the inherently more slippery political variables of coalitional breadth, numbers of veto players, and levels of security threat, there is more room for contestation when it comes to operationalization and measurement. One could also argue that it is a pretty bloodless politics on display in most of the book, with some of the basic cleavages—and the coercive methods employed to deal with them—rather underplayed. Nonetheless, the reader is left with little doubt that there is a crucial and often-neglected political foundation to both the institutional and the economic story told here. While the book's attempt to specify it will not please everyone, it stands right at the forefront of current theoretical work.
The book also stands out for its three sectoral studies—on sugar, textiles, and automobiles—which marry fine-grained empirical detail with rigorous analysis. The three chapters covering these sectors are superb and valuable case studies in themselves, and they bear out the book's arguments on the varying challenges of sustaining growth and competitiveness. For each sector, the different dynamics and structural challenges of the industry are mapped against performance and conditions in Thailand over the past fifty years. In each case, two additional extended case studies illustrate the effects of different institutional and political conditions, thus showcasing both comparatively more successful as well as weaker performance than that achieved by the “intermediate” Thai case.
Overall, this book more than makes good on its claim to put Thailand's economic performance in comparative perspective, and it is an important contribution to the broader literature on economic development. It also holds out significant insights and lessons for those with a particular interest in Thailand or, more generally, the politics of developing countries. Anyone watching the apparent disintegration of Thai politics since 2006 would do well to consider this book's lucid and original analysis of the underlying political economy that is implicated in the current resurgence of conflicting distributional demands.
