Edited by Sanjaya Lall and Shujiro Urata
Yumiko Okamoto and Fredrik Sjöholm 1. INTRODUCTION There are two views of Indonesia’s economic development. One is that its achievement in the three decades prior to the ﬁnancial crisis was impressive. Indonesia achieved high rates of economic growth, large declines in poverty and widespread basic education coupled with rapid industrialization and structural change (Rock, 1999: 169). Moreover, it succeeded in acquiring and adopting new industrial technology within a short period; this provided the basis for the ﬁrst stages of industrial growth as well as the expansion of manufactured exports. Thus, the share of the manufacturing sector in GDP rose from about 12 per cent in 1980 to about 26 per cent by 1996.1 The transformation of the export structure was even more impressive: in the early 1980s, Indonesia was wholly dependent on primary exports, but by the early 1990s the share of manufactures had exceeded 50 per cent. The other view is more pessimistic. Indonesia, an economic latecomer by East Asian industrial standards, still operates at the bottom of the technology ladder (Lall, 1998: 141). Its industrial specialization is in relatively low technology and there is little improvement in its technological status over time. This is held to be one factor explaining its failure to achieve a real economic convergence with its wealthier neighbours. Indonesia seems to oﬀer two kinds of lessons on development. The ﬁrst relates to the management of the ﬁrst stages of industrialization (how to gain access to the necessary technology and to use it...
You are not authenticated to view the full text of this chapter or article.
Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.
Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.
Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.