ABSTRACT
The resurgence of neo-classical thought in economics, which characterized the 1980s, can be understood in part as a reaction against earlier Keynesian and other more radical economic influences, which tended to favor government intervention to achieve economic policy objectives. The main pretext for state intervention in South Korea has been to build an "independent economy" and for industrial upgrading by "a transfer of labor from low productivity sectors to high productivity sectors," for example as realized through the heavy chemical industries drive in the late 1970s. The success of industrial policy in Taiwan and South Korea has shown that the state can indeed play a positive and crucial role in late industrialization. However, direct emulation of the East Asian newly industrializing countries experiences may not be feasible, as their development strategies were forged in particular historical, social and political circumstances.
