ABSTRACT
This chapter examines some of the basic structural characteristics of Taiwan’s economy in international perspective for the period 1960–1990. These characteristics are used to suggest why Taiwan was able to apply so successfully the late industrializing model. Taiwan’s coefficient of variation was extremely high by international standards in 1961–1973. At that time Taiwan’s growth instability was surpassed only in South Asia (the Guomindang’s experience with inflation in prewar China was also near record-breaking). By 1974–1987, Taiwan’s growth began to accelerate further, but its coefficient of variation became the lowest among all countries. The growth path in the late-industrializing model is defined by an absence of pioneering technology even in leading enterprises. Whereas a driving force behind the First and Second Industrial Revolutions was the innovations of radically new products and processes, no major technological breakthrough has been associated with twentieth-century industrialization.
