ABSTRACT
This chapter examines theoretical approaches relevant to the development of the automotive industry in Southeast Asia. Although Southeast Asian countries seem rather different from Northeast Asian developmental states such as South Korea, they can be classified as neo-developmental states in the sense that they have been employing vertically oriented hard (directive) industrial policies for their economic growth. There is also the issue of how much ‘policy space’ still exists under the WTO as it has moved in the 2000s and beyond, towards a more strongly free-market stance on industrial policy, reducing developing countries’ policy options. The chapter shows policy options are not as constrained as might first appear: some are still available with imaginative policy. Secondly, the global value chain concept is examined in relation to the automotive industry, a concept strongly interested in issues of industrial upgrading. The chapter considers whether tendencies towards long-term collaborative relationships between assemblers and global mega-suppliers hinder upgrading opportunities for local firms. GVC writers nowadays pay attention to the role of industrial policy to enhance upgrading by local suppliers, as well as dealing with lead firms in the context of the growth of regional as well as global production networks.
