Taiwan History and Economic Development

19th-Century Taiwan

  • Qing Frontier: Taiwan was a frontier area during the Qing dynasty.
  • Overseas Chinese Comparison: Similar to overseas Chinese communities.
  • Diminishing Violence: Gradual decrease in violence over time.
  • Land and Irrigation: Agriculture was important, with both large and small landlords.
  • Private Irrigation: Private systems of irrigation were common.
  • Camphor: Camphor production was a key industry.
  • The Last Frontier: Taiwan represented the last frontier for settlement.
  • Whales & Elephants: Resources such as whales and elephants were exploited.

Tea

  • John Dodd & Li Chunsheng: Key figures in the tea industry.
  • Entrepreneurship from the Outside: External entrepreneurs played a significant role.
  • First Financial "Revolution": The tea industry spurred early financial development.
  • Northern Interest Rates & Land Prices: Tea cultivation influenced financial dynamics, raising interest rates and land prices in the north.
  • Long-Term Institutional Effects: The tea trade had lasting impacts on Taiwan's institutions.
  • Pouchoung (Baozhong) Tea, Black Tea & Japan’s Return: Different types of tea and Japan's involvement influenced the industry.
  • Entrepreneurship from the Outside Again: Continued importance of outside entrepreneurs.
  • Opportunism: The tea industry fostered a culture of opportunism.

Sugar

  • Japan’s Attempt to Modernize: Japan aimed to create a modern sugar industry in Taiwan.
  • Taiwan Sugar Corporation: This corporation was established to improve small mills.
  • Sugar Cartel: A sugar cartel controlled the industry.
  • Monopsony Areas: Certain areas were monopsonies, where a single buyer dominated.
  • Captive Consumers: Consumers were often captive to the sugar industry's practices.
  • Postwar Sugar: The sugar industry continued to be significant after World War II.
  • The Wrong Industry: Eventually, sugar became a less strategic industry.

Rice

  • Capital-Intensive Farming: Rice farming required significant capital investment.
  • Raising Interest Rates: Rice cultivation contributed to increased interest rates.
  • Strengthening Families: Successful rice farming strengthened family units.
  • Zailai & Ponlai Rice: Different varieties of rice.
  • Iso Eikichi & the Green Revolution: Iso Eikichi and the Green Revolution greatly influenced rice production.
  • Second Financial "Revolution": Rice cultivation drove further financial development.
  • Effects on Sugar Cane, etc.: Effects of rice farming on other crops like sugar cane.

Mining

  • Discovering Gold: Gold discovery led to mining activities.
  • Gold Rush: A gold rush occurred in Taiwan.
  • Low-Capital Mining: Early mining required relatively little capital.
  • Jiufen versus Jinguashi: Comparison of two mining areas.
  • Yen Yun-nian’s New Approach: Yen Yun-nian introduced a new approach to mining.
  • Biggest Gold Mine in Asia: Taiwan had the largest gold mine in Asia.

Hats

  • Creating the Industry: The hat industry was intentionally developed.
  • Outside Entrepreneurship Variant: The hat industry involved a unique form of outside entrepreneurship.
  • Taiwan versus Okinawa: Comparison with Okinawa's hat industry.
  • Two Systems of Production: Different systems of hat production existed.
  • How Taiwan Took The Lead: Factors that led to Taiwan's dominance in the hat industry.
  • Future SME Heartland: The hat industry contributed to Taiwan becoming a hub for small and medium enterprises (SMEs).
  • Female Labor: The hat industry relied heavily on female labor.
  • Japanese Connections: Connections with Japan played a role in the hat industry.

Fascism, War & Civil War

  • Preparing Taiwan for War: Taiwan was prepared for war under Japanese rule.
  • Electricity & Heavy Industry: Expansion of electricity and heavy industry.
  • Import Substitution: Policies promoting import substitution.
  • Wartime Problems: Challenges faced during wartime.
  • Bombing: Taiwan experienced bombing during the war.
  • Agriculture: Wartime impact on agriculture.
  • The KMT Takeover: The Kuomintang (KMT) took over Taiwan.
  • Corruption & Civil War: Corruption and the Chinese Civil War affected Taiwan.
  • KMT Central Government Arrival: The KMT government moved to Taiwan.
  • A New Ruling Class & Soldiers: Emergence of a new ruling class and military presence.

1950s—Controlled Growth

  • US Aid: US aid played a significant role in Taiwan's development.
  • Similar to South Korea: Development strategies were similar to those in South Korea.
  • Beef & Noodles and Cotton: Industries supported by US aid.
  • Land Reform: Land reform policies were implemented to promote equality.
  • Toward Equality: Land reform aimed to reduce inequality.
  • Asparagus & Mushrooms: New agricultural exports.
  • Crony Capitalism: Elements of crony capitalism existed.
  • Finance & Real Estate: Rise of financial and real estate companies (Chinatrust, Cathay, Fubon, Shin Kong).
  • T.S. Lin ("the father of industry") versus Tang Eng: Key figures and companies in the industrial sector.
  • Far Eastern & Textiles: Growth of the Far Eastern Group and the textile industry.

Consumer Exports Boom

  • The Foreign Foundation: Foreign investment and influence.
  • Retail, Transportation and Communications Revolutions: Rapid modernization in these sectors.
  • Japan’s Role: Japan's influence on Taiwan's economy.
  • The Surprising Boom: Unexpected economic boom.
  • The end of aid & depreciation: The end of US aid and currency depreciation.
  • Government Plans: Government economic development plans.
  • Speed Intensity: Focus on speed and efficiency.
  • Entrepreneurship over Management: Emphasis on entrepreneurship rather than management.
  • Subcontracting & Networking: Importance of subcontracting and networking.
  • Speed over Quality: Early focus on speed rather than quality.
  • High Wages: Labor over capital.
  • Bicycles: Example of a successful export product.
  • From speed to quality: Shift from prioritizing speed to prioritizing quality.

Heavy Industry

  • The place of heavy industry: The role of heavy industry in Taiwan's economy.
  • The Next Step: Considered the next stage of economic development.
  • Sugar Mills: Using sugar mills for industrial purposes.
  • Wang Yung-ching: Important figure in the development of heavy industry.
  • A different type of businessperson: Business leaders different from traditional entrepreneurs.
  • Ten Major Projects: Large-scale infrastructure projects.
  • SOEs versus Chaebol: State-owned enterprises compared to Korean chaebols.
  • The retreat from heavy industry: Shift away from heavy industry.

Electronics

  • Early electronic assembly: Early focus on electronic assembly.
  • Inward FDI and SEZs: Foreign direct investment and special economic zones.
  • Technology, speed & components: Importance of technology, speed, and components.
  • Calculators: Example of an early electronics product.
  • The left behind: Stanley Shih and Barry Lam: Individuals who transformed the electronics industry.
  • Computers: Development of the computer industry.
  • The IBM-compatible & OEM: Focus on IBM-compatible computers and original equipment manufacturing (OEM).
  • Acer’s attempt: Acer's efforts in the computer industry.
  • Semiconductors: Growth of the semiconductor industry.
  • The government & UMC: Government support for United Microelectronics Corporation (UMC).
  • Morris Chang takes control: Morris Chang's leadership in the semiconductor industry.

Outgoing FDI

  • The financial bubble: The financial bubble period.
  • Taiwan’s crazy years: Period of economic exuberance and instability.
  • Traditional industry squeezed off the island: Traditional industries moved offshore.
  • Crossing the straits: Investment in mainland China.
  • Go south: Investment in Southeast Asia.
  • Fujian to Shenzhen: Key investment destinations in China.
  • Made in China by Taiwan: Products made in China by Taiwanese companies.
  • Electronics FDI: Foreign direct investment in electronics.
  • Kunshan: Important location for Taiwanese electronics manufacturing in China.
  • Terry Gou & Foxconn: Emergence of Terry Gou and Foxconn.

Present & Future

  • Problems: Current challenges.
  • A possible invasion: Threat of invasion from China.
  • A shrinking, aging population: Demographic challenges.
  • An overreliance on electronics: Overdependence on the electronics industry.
  • Hopes: Future prospects.
  • A new Hong Kong: Potential to become a financial center.
  • A cultural metamorphosis: Cultural changes.
  • A new Silicon Valley: Aspiring to become a technology hub like Silicon Valley.