* The author gratefully acknowledges the assistance of Research Fellow Linda Chao of the Hoover Institution. He is also indebted to Thomas A. Metzger for many helpful discussions and for critical comments offered by members of the “Taiwan Today” conference, hosted by The China Quarterly, 20–21 November 1995, Taipei, Taiwan, Republic of China on Taiwan. All are, of course, innocent of any errors or omissions.

1 Su, You-chi,“Hai yang” (“The sea”), in Zhou, Huiqing(ed.), Qianzhan Taiwan: xin dingwei (A Glance at Taiwan's Future: A New Position)(Taipei:Tianxia zazhi,1994), p.14.Google Scholar

2 Gary, Klintworth,New Taiwan, New China: Taiwan's Changing Role in the Asia-Pacific Region(New York:Longmans/St. Martin's Press,1995), p.3.Google Scholar

3 Tens of thousands of young people left Taiwan for higher education in the United States over the past 45 years. For examples of how U.S. officials pressured Taiwan government officials in the early 1950s to expand free enterprise, see Thomas Gold, State and Society in the Taiwan Miracle(Armonk, NY:M. E. Sharpe, 1986), p. 73 and pp. 76–77.Google Scholar

4 I avoid using the term modernization because it has become a misunderstood and confusing concept. Consider the modernization paradigm of the 1950s and 1960s, which consisted of seven political attributes, eight social attributes, ten economic attributes and eight intellectual characteristics. SeeJohn Whitney Hall, “Changing conceptions of the modernization of Japan,” in Marius B. Jansen(ed.),Changing Japanese Attitudes toward Modernization (Princeton:Princeton University Press,1965), pp.20–23. Written over 30 years ago and based on a conference in Hakone, Japan, this described the difficulties of getting U.S. and Japanese scholars to agree on the meaning of modernization. When Japanese scholars questioned the American participants as to why their concept of modernization did not include democracy, the American side had no response. I am indebted to Mark Peattie for this reference.Google Scholar

5 I am indebted to Thomas, A. Metzger,“The Western concept of the civil society in the context of Chinese history,” in Sudipta Kaviraj and Sunil Khilnani(eds),Civil Society: History and Possibilities(Cambridge:Cambridge University Press, 1997).Google Scholar

6 Reinhard Bendix,“Tradition and modernity reconsidered,” Comparative Studies in Society and History, Vol.9, No. 3 (April 1967), p.334.Google Scholar

7 Alexander Gerschenkron,Economic Backwardness in Historical Perspective: A Book of Essays(New York: Praeger,1965), p.8;Google Scholarand particularly Thomas, A. Metzger, Escape from Predicament(New York:Columbia University Press, 1977), ch. 5.Google Scholar

8 Zhongyang ribao, 11 October 1952, p. 1.

9 Jiang Jingguo [Chiang Ching-kuo], “Zhongguo zhi tongyi yu shije heping” (“The unification of China and world peace”), Lianhe bao, 30 March 1986, p. 3.Google Scholar

10 Wu Xuansan, “Li zongtong di quan fanwei jiguo limian” (“President Lee's comprehensive ideas about our nation's management”), in Zhongshi wenhua, Yumin tongxin(To Walk With the People)(Taipei:Zhongshi wenhua gongsi,1995), p.56.Google Scholar

11 Li I, “Li Denghui yuan zou huahang fei wang Beijing” (“Lee Teng-hui would like to fly to Beijing on China Airlines”), Jiushi niandai, August 1995, p. 36.Google Scholar

12 Li Denghui [Lee Teng-hui], “Bixu zhuquan zai min” (“It is necessary that sovereignty reside with the people”), Zhongyang ribao, 23 April 1994, p. 1.Google Scholar

13 Li I, “Li Denghui,” p. 36.

14 Gao Xizhun, ‘“Hou Taiwan jingyan yu xin Taiwan ren” (“The post Taiwan experience and the new Taiwanese”), Yuanjian zazhi, No. 103 (15 December1994), pp. 22–24. For intellectual mobilization in the transformation of societies from aristocracy and monarchy to political parties representing the peopleGoogle Scholar, see Reinhard, Bendix, King or People: Power and the Mandate to Rule(Berkeley:University of California Press,1978).Google Scholar

15 For more discussion of these concepts, see the introduction written byMetzger and Myers inRamon H. Myers(ed.).Two Societies in Opposition: The Republic of China and the People's Republic of China after Forty Years(Stanford:Hoover Institution Press,1991).These concepts were developed by Metzger, as well as the framework of the three marketplaces (which I have recast as “three market processes”), which is an organizing principle in this essay.Google Scholar

16 See Linda, Chao and Ramon H. Myers, “The first Chinese democracy: political development of the Republic of China on Taiwan, 1986–1994,” Asian Survey, Vol.34, No. 3 (March 1994), pp.213–230.Google Scholar

17 “Zhengdang zhengzhi yijing maiqu zhenggong diyi da bu” (“Pluralistic political parties already have taken one greatly successful step”), Zhongyang ribao, 2 December 1993,p.1.Google Scholar

18 Samuel, P.Huntington,The Third Wave: Democratization in the Late Twentieth Century(Norman:University of Oklahoma Press,1991), pp.46–106. These conditions, in brief, are the following: declining legitimacy and performance of the regime; economic development and economic crisis; religious change; new policies of external factors; demonstrations and a global tidal wave of democratic change.Google Scholar

19 This interpretation as well as others below are based on Linda, Chao and Ramon H. Myers,The First Chinese Democracy: Political Life in the Republic of China on Taiwan (Baltimore:The Johns Hopkins University Press,1997).Google Scholar

20 Jiang Jingguo [Chiang Ching-kuo], “Shoufa shoufen shouji yiguojia liyi wei zhong” (‘To focus on our nation's best interests, we must uphold the law, have self-control, and exercise self-discipline”), in Jiang Jingguo xiansheng quanji bianji weiyuanhui (Editorial Committee for the Collected Works of Chiang Ching-kuo), Jiang Jingguo xiansheng quanji (Collected Works of Chiang Ching-laio), Vol. 20 (Taipei: Government Information Office, 1991), p. 44, a speech to the KMT's Central Committee in November 1986 on expanding the quota for electing central government representatives.Google Scholar

21 Markets perform both “allocative” and “creative” functions, an important distinction stressed by Heinz, W. Arndt,“ ‘Market failures’ andunderdevelopment,” World Development, Vol. 16, No. 2 (1988), pp. 219–229.Google Scholar

22 For a good discussion of “instrumental rationality” seeWolfgang Mommsen, The Political and Social Theory of Max Weber(Chicago:University of Chicago Press,1989), p.154.Google Scholar

23 For a brief discussion of some of these technocrats, seeLawrence, J. Lau(ed.),Models of Development: A Comparative Study of Economic Growth in South Korea and Taiwan(San Francisco:Institute for Contemporary Studies Press,1990), pp.245–47. See also Gold, State and Society, p. 68.Google Scholar

24 Fu-chih, Liu,Essays on Monetary Development in Taiwan(Taipei:China Committee for Publication Aid and Prize Awards, 1970), pp.37–39.Google Scholar

25 Albert, Park and Bruce Johnston, “Rural development and dynamic externalities in Taiwan's structural transformation,“Economic Development and Cultural Change, Vol. 44, No. 1 (October 1995), pp. 181–208.Google Scholar

26 Ching-yuan, Lin,Industrialization in Taiwan, 1946–1972: Import-Substitution Policies for Developing Countries(New York:Praeger,1973), ch.5.Google Scholar

27 For the best account on the role of foreign investment and enterprise in enhancing Taiwan's competitiveness, see Chi, Schive, The Foreign Factor: The Multinational Corporation's Contribution to the Economic Modernization of the Republic of China (Stanford:Hoover Institution Press,1990).Google Scholar For how the role of export zones and government policies enhanced Taiwan's economic competitiveness, see Ramon, H. Myers, “The economic transformation of the Republic of China on Taiwan,”The China Quarterly, No. 99 (September 1984), pp.500–528; for the role of governmentGoogle Scholar, see Robert, Wade,Governing the Market: Economic Theory and the Role of Government in East Asian Industrialization(Princeton: Princeton University Press, 1990)Google Scholar; Alioe, H. Amsden, ‘Taiwan's economic history: a case of etatisme and a challenge to dependency theory,” in Robert H. Bates(ed.),Toward a Political Economic of Development: A Rational Choice Perspective(Berkeley:University of California Press,1988), pp. 142–175.Google Scholar

28 These three processes are described in Ellis, Chenery and T. N., Srinivasan(eds.), Handbook of Development Economics, Vols. 1–2 (Amsterdam: North-Holland, 1988–89)Google Scholar. They are elegantly explicated in Albert, Fishlow,“Review of Handbook of Development Economics,”Journal of Economic Literature, No.29(December 1991), pp. 1728–37.Google Scholar

29 The United Kingdom first doubled output per person between 1780 and 1838; the United States between 1839 and 1886; Japan between 1885 and 1919; the Republic of Korea between 1966 and 1977; and China between 1977 and 1987. See The World Bank, World Development Report, 1991: The Challenges of Development (Oxford: Oxford University Press, 1991), pp. 12–13. Between 1952 and 1967, Taiwan's gross national product increased from NT$21,435 to NT$45,594 in 1991 prices, more than doubling in 15 years.Google Scholar

30 See The World Bank, World Development Report, 1995: Workers in an Integrating World (Oxford: Oxford University Press, 1995), p. 163, for an international ranking of countries. Because Taiwan is not a member of the World Bank, data for Taiwan for appropriate years can be found in Council for Economic Planning and Development, Republic of China, Taiwan Statistical Data Book, 1995 (Taipei: Council for Economic Planning and Development, 1995), p. 32. The best study for Taiwan's economic growth during the 1940s and 1950s is by Simon, Kuznets, ch. 1 in Walter, Galenson(ed.),Economic Growth and Structural Change in Taiwan(Ithaca, NY: Cornell University Press,1979).Google Scholar

31 See Anchi Lin, “Social and cultural bases of corporate expansion: the formation of business groups (jituan) in Taiwan,” PhD. thesis, Harvard University, 1995, p. 6. This thesis describes the activities and organizational style of large-scale corporations (jituan).Google Scholar

32 Sophia, Wu Huang, “Structural change in Taiwan's agricultural economy,”Economic Development and Cultural Change, Vol.42, No. 1 (October 1993), p.59. In 1989 the average producer subsidy equivalents for agriculture showed 72 for Japan and 88 for South Korea, 29 for Taiwan, 30 for Canada and 18 for the United States.Google Scholar

33 Ibid.. p. 33.

34 For a brief discussion of the competition of these four ideologies and the primacy of Sunist doctrine in Taiwan, see Julie, Lee Wei, Ramon H. Myers and Donald, G. Gillin(eds.), Prescriptions for Saving China: Selected Writings of Sun Yat-sen(Stanford:Hoover Institution Press,1994), p. xxvi. Thomas A. Metzger first alerted me to the competition of these four ideologies in mainland China.Google Scholar

35 See Thomas A. Metzger, “The Chinese reconciliation of moral-sacred values withGoogle Scholar modern pluralism,” in Myers, Societies in Opposition, pp. 10–26.

36 Ibid.. pp. 26–37. The following paragraphs are based on Metzger's analysis of Taiwan's five ideological orientations.

37 For Taiwanese elites‘ sense of predicament, see Gao Xizhun, “Hou Taiwan jingyan yu xin Taiwan ren,” pp. 22–24. Thomas, A. Metzger first introduced this concept in his classic The Escape from Predicament(New York:Columbia University Press,1977).Google Scholar

38 Zhongguo luntan bianweihui (The Committee for the China Forum) (ed.), Zhishifenzi yu Taiwan fajhan (The Intellectuals and Taiwan's Development) (Taipei: Lianjing chubanshe, 1989), p. 133.Google Scholar

39 A recent survey of Taiwan's top civil servants revealed that 70% hold doctorates or master's degrees, a higher educational level than their counterparts around the world. See Allen Pun, “Officials among best educated,” Free China Journal, 28 June 1995, p. 4.

40 Zhongguo luntan bianweihui, Zhishifenzi yu Taiwan fazhan, p. 134.

41 Millsian democracy means that a society has liberty for its individuals, the people have the right to elect their representatives, and finally - a characteristic not often referred to today - these representatives constitute an elite wise in the art of governance and somewhat insulated from their constituents. See Geraint, L. Williams(ed.), John Stuart Mill on Politics and Society(London:Fontana,1976), pp. 177–185Google Scholar in particular. The very different Rousseau concept of democracy refers to empowering the people through representatives who will reflect the people's general will, thus creating a form of “unlimited democracy” that, contrary to Rousseau's theory, will enhance government power. See Donald, A. Cress(trans, and ed.), Jean-Jacques Rousseau: Basic Political Writings(Indianapolis: Hackett Publishing Co., 1987).Google Scholar

42 The ideas expressed in this section owe much to ongoing discussions with Thomas A. Metzger about Taiwan's social transformation and how and why it differs from that of so many other countries.