“How Asia Works” by Joe Studwell explains why some Asian countries got super rich (Japan, South Korea, Taiwan) while others stayed relatively poor (Philippines, Indonesia, Malaysia).
The Recipe for Economic Success ✨
- Start with the farms 🌾
- Give land to small farmers
- Make them grow lots of different crops
- Support them with tech and education
- Build up manufacturing 🏭
- Government needs to push companies to export
- Support local businesses but make them compete globally
- Focus on learning new technologies
- Keep tight control of money 💰
- Don’t let banks do whatever they want
- Direct money toward farms and factories
- Be careful with stock markets and foreign investment
Why This Matters 🤔
The successful countries (Japan, South Korea, Taiwan) followed ALL these steps IN ORDER. The less successful ones (Philippines, Malaysia, Indonesia) skipped steps or did them wrong.
Examples 📚
- Japan started this whole thing after WW2:
- Broke up big farms
- Created companies like Toyota
- Became super rich
- South Korea copied Japan:
- Turned poor farmers into factory workers
- Created Samsung and Hyundai
- Now makes awesome phones and cars
What About China? 🇨🇳
China is following this recipe too, but with some twists:
- Started with farming reforms (✅)
- Building lots of factories (✅)
- Still figuring out the money part (🤔)
- Facing new challenges like aging population
The Big Takeaway 💡
The author’s main point: Poor countries don’t have to wait for magic to happen – there’s a clear path to follow. But it takes:
- Strong government leadership
- Following the steps in order
- Being patient (it takes decades)
- Not listening to bad advice about free markets solving everything (The World Bank, The Washington Consensus) 👎
Why It Failed Elsewhere 😕
Countries that struggled usually:
- Let rich people keep all the farmland
- Trusted foreign investment too much
- Let banks do whatever they wanted
- Tried to skip straight to being “modern”
Here’s one of the most important principles from the book.