I was reading about the history of South Korea, particularly the Park Chung-hee Dictatorship from 1961 until Park's assassination in 1979.
Two qualities define his reign -
1. Authoritarianism. Suppression of opposition, suppression of liberalism, militarism, war, and general high-handedness.
2. Industrialization. Rapidly modernizing, improvement in economic quality of life, South Korea's rise from the most devastated part of East Asia into a burgeoning economic power.
You'll see lots of history follow that pattern -- authoritarian societies seem to be able to rapidly industrialize and "catch up" with the rest of the world.
It seems like liberal societies do better at inventing, but authoritarian societies can do better at rapidly building capital and an industrial base.
Why is this? When countries are economically in bad shape, people's preferences shift to short time perspectives. Perhaps authoritarianism can channel resources from consumption to investment among people that would normally consume, thus building an industrial base.
But authoritarianism, at least thus far, seems counter-productive to innovation. You'll see liberal republics consistently produce more shifts and changes, out of which comes the innovations in art, culture, and technology that push the envelope.
So, the big questions become -- can liberal societies industrialize as effectively, and can authoritarian societies manage to innovate and invent?
There's probably examples and counterexamples worth discussing -- share your anecdotes and experiences in the comments?
You'll see the trend of rapid catchup in almost all East Asian economies. Check out Singapore, the tigers, Korea as you mentioned. It seems that they have a problem shifting from catchup to the next level, though.
On a related note, Japan wasn't authoritarian but it had a stable one party rule for most of its easy growth period.
Most interesting to watch will of course be China. Will they overtake the US?
there is a good book of essays written in the mid 90's on this by Krugman, talking about 'total factor productivity'. Yes, authoritarian govts are good at quickly deploying capital, but this doesn't mean they are deploying capital to the right areas.
Right after reading this post I read an interesting blog from a Valve employee (http://goo.gl/nGHdl/) about, amongst other things, the culture at that company. There's almost no hierarchy there at all. A company with 300 people that lacks any form of hierarchy. Very interesting read.
This blog post left an incredible impression on me, but it also raises the thought whether it will work in the long run. The writer also states that it gets a bit more formalized when they're at Valve close to shipping.
My thoughts are that the approach (either more authoritarian or more liberal) is not that important: it's whether you can make sure on the long run that the strategy that gets chosen suits the goals: to thrive.
Now you get to values, ideologies, morale. It's pretty easy to influence people into going a more liberal route (when there is a lot of untapped potential) or a more autoritarian route (when there are more constraints and people want to be effectively lead), but how do you guide people on the long run? How do you make sure that people change strategies when it is needed, that they keep in mind what is truly important?
Philosophy, religion, tradition, to a lesser extend ideology, those are strategies of a higher order than simply choosing liberalism or authoritarianism. It's there where the long term success lies, and I think it's incredibly difficult (and maybe impossible) to get that right.
In Brazil, for example, our industrialization process happened quickly under a autoritarian governement,but the process was really expensive: they were just taking lots of loans, investing them in heavy industries, making huge works (higways, bridges ...) to employing lots of people and seems like the country was developing.
I mean, it was important, but it totally messed up our economy two decades later.
Good questions from a reader -
There are some questions I want to ask you about the shogun era.
Why didn't the generals around Tokugawa Ieyasu aim for more power?
What were their end game?
Seeing Like a State by Scott is quite an eye-opener, especially if you've been dabbling in decentralization, economics, and social models.
The general premise is that central planning doesn't work, but the perspective taken is very unique and I haven't seen anything like it in classical free-market economics texts. Scott demonstrates how central planning has failed. The book is like a visual guide to what Hayek described as the "fatal conceit" of central planners.
What strikes me every time I read about the failures of central planning is that planning isn't the problem. Everybody plans, you can't not plan. If you decide to not plan, that's a plan right there. Free market types plan all the time, every company and every capitalist plans.
So is the problem with central planning "central"? What does that even mean?
Scott circumvents these etymological problems by using different words. He doesn't talk about central planning. He talks about high-modernist authoritarianism.