Explaining political change and economic conditions in the newly industrializing countries: Government's commitment strategy to economic actors

The dissertation consists of two parts. In the first, I draw from rational choice theory of institutions to characterize economic growth and political development in the NICs as a pattern of incentives, communication, and coordination. Specifically, I theorize that governments in the NICs adopt economic policies because they believe that a successful economy will lead to continued tenure in office, and economic actors follow these policy prescriptions if they expect individually to do better. Governments in the NICs understand that a successful economy depends largely on the extent to which economic actors follow policy prescriptions. To motivate such adherence, governments demonstrate their "commitment" to increasing economic opportunities through the adoption of various changes in political arrangements. Within this theoretical framework, changes in political arrangements serve strategically to equilibrate the relationship between government and economic actors.;The second part of the dissertation is an empirical application of the framework, in which I demonstrate its descriptive and explanatory utility in Malaysia and Singapore. Business reports of annual and quarterly economic data and government reports of changes in political processes, structures, and roles provide empirical support for the following generalizations. First, if the government succeeds in increasing economic opportunities, economic actors will continue to follow policy prescriptions, without changes in government. In fact, if economic opportunities increase, the government will not adopt political changes. That is, the government will not reduce or eliminate the duties of personnel or agencies, and will not change political roles, processes, and structures, and will not increase monitoring. Second, if the government does not increase economic opportunities, economic actors will continue to follow policy prescriptions only if the government adopts political changes. If the government does not adopt political change, that is, if it fails to reduce or eliminate the duties of the responsible personnel or agency and change political roles, structures, and processes, and increase monitoring, economic actors will individually or collectively deviate to "punish" the government.;Some implications of the theory are as follows. Contrary to existing modernization arguments, political changes typically identified as "liberalization" follow economic failures. That is, political changes do not follow economic development, nor is economic development necessary or sufficient to impel political changes. Moreover, the theory allows us to predict under what conditions political changes will follow "liberalization" efforts and what form these changes will take. Specifically, if the economy is successful, "liberalization" efforts will halt, and any attempt to force the government to adopt more political changes will lead to repression; should the economy fail, however, the government will follow "liberalization" with "democratization" to overcome the economic exigency. (Abstract shortened by UMI.).