Analysis

• First "Asian tigers": Japan, South Korea, Taiwan, Singapore, Hong Kong
• Different philosophies: Shinto, Buddhist, Confucian
• Different histories: Japan was already westernized, Taiwan partially (as a Japanese colony), Korea never was, Hong Kong and Singapore are British colonies
• Role of the state: from ubiquitous (Japan) to totalitarian (Singapore, South Korea, Taiwan) to indifferent (Hong Kong)
• Government: mostly of humble origins and uneducated
• Benevolent dictator whose main goal is not his own wealth or a dynasty but the good of the country (Not unique to Asia: Hitler, Mussolini, Stalin, Pinochet)

• East Asian countries lack natural resources
• To pay for imports, they export cheap goods to the USA
• Develop a knack for understanding Western consumer behavior and social trends
• The USA de facto pays for their development
• The geopolitics of the Cold War (need to contain the Soviet Union) de facto drives the early Asian boom
• What they have in common is not cultural or political background but that they are allies of the USA during the Cold War
• Singapore's unique model: favors foreign investment by multinationals over nurturing national conglomerates

• They ignore Western economic theories and use common sense and traditional values
• They ignore social and economies ideologies of the Third World
• Centralized economy enables long-term planning and short-term decisions
• The government rewards with favors the companies that achieve world-class results
• Asian people demand economic growth before democratic growth

• Second generation of "Asian tigers" (1990s): China, India, Thailand, Malaysia
• Different philosophies: Confucian, Hindu, Buddhist, Muslim
• Role of the state: liberal reforms reduce the power of the state (China, India)
• Government: mostly technocrats and educated
• China: needs money and technology (needs the Western capitalists)
• India: poor transportation and electricity infrastructure, restrictive labor laws discourage labor-intensive sectors

• Taiwan, Singapore, South Korea, etc, China capitalized on cheap labor to capture offsourced jobs from the USA
• India capitalized on English-speaking, college-educated and cheap engineers to capture offsourced jobs from the USA
• The USA lost blue-collar (low-paying low-skills) jobs to China
• The USA loses white-collar (high-paying high-skills) jobs to India

• China: Chinese conglomerates succeed because of the government
• India: Indian conglomerates succeed despite the government
• Indian conglomerates aim for self-sufficiency
• Jindal produces steel and power through backward integration from its own captive coal and iron-ore mines
• Gautam Adani buys port and coal mines, builds power plant and railway
• India: unlike China's labor-intensive exports, exporting capital-intensive items that require skilled workers

• East Asian countries that did not experience the boom:
• Philippines (Catholic, USA ally)
• Pakistan (Muslim, USA ally)
• Bangladesh (Muslim, neutral)
• Vietnam (Buddhist, USA enemy)
• Laos (Buddhist, USA enemy)
• Cambodia (Buddhist, USA enemy)
• North Korea (Buddhist, USA enemy)
• Mongolia (Buddhist, USA enemy)

Notes

There is no single cultural/political explanation for the Asian miracle because the countries of Asia spanned a broad spectrum of philosophies (Confucian, Shinto, Buddhist, Hindu, Muslim) and of political systems: fascism (South Korea, Singapore, Taiwan, Thailand), communism (mainland China), socialism (India), democracy (Japan, Hong Kong).

There are actually two Asian miracles. The first Asian miracle was low-tech and largely based on cheap labor and loose business regulations. The first Asia miracle relied on a simple business plan: do what the West does but do it cheaper and possibly better. This became an art in itself. It also caused the rapid Westernization of all US allies in Asia (that until World War II had largely held on to their traditions). The second Asian miracle was high-tech and based on improving Western high technology. By this time Asia had become very Westernized and, in particular, democracy had become widespread.

The first Asian miracle was largely the consequence of the Cold War between the USA and the Soviet Union. The USA helped the Asian (and Western European) economies develop in order to create stable and strong defenses against the communist world. The USA encouraged trade with its oversea allies, and tolerated that they competed unfairly with US-based manufacturers by keeping their currencies very low.

Government intervention was crucial to the development of these economies: they all boomed under the supervision of a benevolent dictatorship that nurtured and guided the private sector.

Most of the political leaders of the first boom came not from the aristocracy but from the very poor class. These leaders were interested in copying Western industrial methods but ignored Western economic theory: they used common sense and traditional values. They nonetheless became enlightened leaders who somehow made mostly good choices to turn their starving countries into economic tigers. This is not as unusual as it may sound: Hitler, Mussolini and Stalin were really bad people but didn't do what they did to enrich themselves or start a dynasty. They in fact greatly improved the economies of their respective countries.

All the early boomers lacked natural resources. In order to pay for them, they had to focus on exporting. The big open market was the USA. Therefore it was natural that they focused on exporting to the USA. The USA also provided the military protection that helped these countries focus only on the economy. Security was guaranteed and paid for by the USA. What these early boomers had in common was not a cultural or political background but that they were all allies of the USA during the Cold War.

The second Asian miracle was largely the consequence of the end of the Cold War. The collapse of the Soviet Union and of its communist block turned the whole world into one colossal capitalist market. The Asian countries applied their learned skills on a larger scale to a larger market. Globalization favored Asian products over the more expensive products from Western Europe and the USA. However, by now Asia had learned sophisticated industrial and business methods, and was not restricted to cheap goods. Its factories had developed into high-tech factories by serving US manufacturers, but the know-how could now be recycled internally to create factories that served Asian manufacturers. Therefore Asia found itself capable of competing with the West in the much more lucrative high-tech field.

This second Asian miracle introduced two colossal players. Mainland China simply followed the path of Western imitation that had been tested by the old "tigers". India, however, could also sell a widespread knowledge of the English language and Western-style universities that graduated scores of mathematically-inclined students, two factors which created an opportunity for the service industry. Again, the natural customer was the USA, in this case the booming computer and Internet industry. The USA, again, provided the military protection that helped these economies grow in a world largely at peace. West of Pakistan, Asia was relatively at peace. The real trouble was in the Middle East and East-Central Asia, i.e. in the Islamic world. The USA and its Western allies of NATO were busy maintaining some kind of order there, which also provided for safe trade routes. Even mainland China, that quickly became the USA's main rival on the world stage, relied on trade routes from Africa and the Middle East that were guarded by the mighty military of the USA.

There were East Asian countries that did "not" experience that kind of economic boom, and not all of them were enemies of the USA: the Philippines (Catholic, ally), Pakistan (Muslim, ally), Bangladesh (Muslim, neutral), North Korea (Buddhist, enemy), Vietnam (Buddhist, enemy until the late 1990s), Laos (Buddhist, enemy until the late 1990s), Cambodia (Buddhist, enemy until the late 1990s), Mongolia (Buddhist, enemy until the early 1990s). Each of them shared either the cultural or political background with one of the booming economies, but did not experience a similar oom.