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Institutions and Comparative Economic Development pp 13–47Cite as

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The Five Phases of Economic Development and Institutional Evolution in China, Japan, and Korea

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Abstract

In 2010, aggregate real gross domestic product (GDP) in terms of purchasing power parity (PPP) of China, Japan, South Korea (henceforth Korea), Hong Kong, China, and Taiwan surpassed that of both North America and the European Union.1 According to Maddison’s frequently cited estimate, these economies together also constituted the largest economic zone in 1820, producing more than one-third of the world’s total GDP.2 However, their share dropped by more than three quarters toward the middle of the 20th century, which was then followed by the successive miracles of Japan, the Asian Tigers and now China. What accounts for such a dramatic fall from historical heights and then the resurgence of the region as a whole? Is there anything unique about the East Asian development pattern? What implications does this experience have for future development?

An earlier version of this paper was presented as the Presidential Lecture at the 16th World Congress of the International Economic Association held in Beijing on 4 July 2011. I am grateful to Wenmeng Feng of CDRF, Beijing, and Yoko Yamamoto, formerly of VCASI, Tokyo, for their excellent research assistance. I also thank Professor Liu Minquan of Peking University and Professor Rhee Young-hoon of Seoul National University for their valuable advice to improve on the draft lecture.

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  1. Stanford University, USA

    Masahiko Aoki

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  1. Masahiko Aoki
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  1. Stanford University, USA

    Masahiko Aoki

  2. Duke University, USA

    Timur Kuran

  3. University of California, Berkeley, USA

    Gérard Roland

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Aoki, M. (2012). The Five Phases of Economic Development and Institutional Evolution in China, Japan, and Korea. In: Aoki, M., Kuran, T., Roland, G. (eds) Institutions and Comparative Economic Development. International Economic Association Series. Palgrave Macmillan, London. https://doi.org/10.1057/9781137034014_2

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