The ‘Flying Geese’ Paradigm of Catch-up Growth
New Horizons in International Business series
Chapter 1: Hegemon-Led Growth Clustering and the Flying-Geese Paradigm of Catch-up Growth
1.1. TWO HEGEMONIES AND TANDEM GROWTH It is important to keep in mind that Japan’s phenomenal economic growth, both pre- and post-World War II, has been a derivative of the spread of global capitalism, early on under the Pax Britannica and more recently under the Pax Americana. In other words, Japan’s rapid industrialization would have been inconceivable if it had not been for the roles of Great Britain and the United States as the successive hegemons that created a favorable global environment for trade, investment, and technology transmission. The postwar US hegemony in particular has brought about a host of ideal opportunities for Japan to capitalize on in crafting and pursuing its own brand of catch-up growth. The Pax Britannica and the Pax Americana both constitute a global economic system of what may be called ‘hegemon-led growth clustering’ (a hegemon-driven process of tandem growth) (Ozawa, 2003c), when looked at from an economics point of view (though it has many other dimensions). Growth clustering is a phenomenon in which a hegemon economy propagates growth stimuli to its closely aligned cohort of countries that are at various stages of development and structural transformation. The stimuli include dissemination of technology, knowledge, information, skills, and demand (via access to the hegemon’s home market), and provision of development finance – and above all, transplantation of growth-inducing institutional arrangements of open market capitalism; this all contributes to higher levels of industrial productivity, efficiency, and per capita income. The lower-echelon countries can ‘free ride’ and thrive on those...