The Transition in Open Dualistic Economies. By Douglas Paauw and John Fei. New Haven: Yale University Press. 1973. 306 pp.Price! 12.50

Mahmood Ali Ayub


This book is concerned with a special type of less developed
countries having open dualistic economies. It deals with transition
growth, the postwar era of 1950—1970, which is a relatively short
period, sandwiched between the two long epochs of colonial growth and
modern economic growth. The hallmark of the colonial epoch is the
imposition of foreign political control on the agrarian economy of the
colony to result in a heavy reliance upon primary product exports. The
non-agricultural sector and the com¬mercialized agricultural sector form
an enclave which is "involved in a trian¬gular pattern of resource
utilization with the foreign sector." The economic goal of colonialism
is to extract from the colony the maximum export surplus. This feature
of colonial growth is vital to the examination of the transition growth
process because the subsequent experience of the colony after political
independence depends on how these export profits are employed. The main
point of the book is that the use of export profits to alter the
economic structure differs among countries, and the authors identify two
types of experience. The first is economic nationalism, under which the
trade- related profits are utilized for a thorough change in the
production and trade patterns. The second is neocolonialism in which, by
contrast, the trade- related profits are employed to strengthen and
perpetuate the colonial pattern of growth. Taiwan and the Philippines
are cited as examples of economic nationalist transition growth while
Malaysia and Thailand are examples of the neocolonial pattern of growth.

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