Title: Steeling the 'developmental state'? The comparative political economy of industrial policy and state-business relations in the Chinese and Japanese steel industries

Authors: Ryan Foster

Addresses: Department of Political Science, York University, 4700 Keele St., Toronto, ON, M3J 1P3, Canada

Abstract: This paper conducts a comparative historical review of industrial policy and state-business relations in the Chinese and Japanese steel industries. The paper challenges a common assumption within literature concerned with the developmental state, as well as research on the Chinese steel industry, that China and Japan represent polar opposite cases with respect to the effectiveness of bureaucratic intervention in strategic sectors. Through a comparative review of China's current efforts and Japan's mid-twentieth century efforts to consolidate and set price cartels in the steel industry, the paper finds a remarkable resemblance between policy challenges and failures in both countries at a similar phase of their market-oriented industrial development. These findings offer insights into the policy challenges that China and other late industrialising countries currently face as they proceed with modernising their respective steel industries.

Keywords: developmental state; China; Japan; steel industry; BRIC countries; bureaucracy; oligopoly; price cartels; industrial policy; state-business relations; state intervention; modernisation.

DOI: 10.1504/IJEBR.2012.049534

International Journal of Economics and Business Research, 2012 Vol.4 No.6, pp.704 - 718

Published online: 25 Nov 2014 *

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