ABSTRACT
This chapter examines how South Korea, Taiwan, Spain, and Argentina attempted to develop automobile assembly and component manufacturing industries during the post–World War II period. It then compares the experiences and observes that each country gravitated over time toward a configuration of component manufacturing and automobile assembly made possible by indigenous institutional arrangements. Great inequalities in economic development have been an enduring issue of interest in the social sciences. The institutional approach to development departs from previous theories in its contingent nature, emphasizing that there is no single best path, process, or pattern of development or of social organization. Clearly, similar sets of import-substitution policies in Argentina and in Taiwan produced thoroughly dissimilar results in component manufacturing because of the different characteristics of their small-firm sectors. Populism led to numerous regulations aimed at promoting a false sense of security and at keeping interest groups satisfied.
