This paper examines the relation of particular forms of social and labour market policy to economic development. Taking the history of Malaysian industrialization as its empirical case, the paper assesses the unintended consequences of redistribution policy, on the one hand, and migration policy, on the other, for the limited upgrading of the country's electronics industry. It argues that, while the former has been central to social harmony in Malaysia's multi-racial society, it has contributed to the underdevelopment of small and medium-sized firms capable of linking with the TNCs on the basis of knowledge-intensive and higher value-added operations. Migration policy, on the other hand, has allowed manufacturers to have continued access to supplies of low-cost, lower-skilled labour that have released the pressures that would otherwise have been there for technological and skill upgrading in the electronics industry. Only in Penang, where regional state institutions have intervened to encourage S...

Unintended consequences: social policy, state institutions and the ‘stalling’ of the Malaysian industrialization project

There has been recognition for some time that the management policies in overseas operations of multinational companies may be complex. This is not only due to diverse business or product market strategies, but also because the political, economic, social, legislative and cultural environment varies between locations. In particular, a neglected aspect of the context is ethnicity, especially in locations which are multi-ethnic. Such environments provide not only ‘constraints’, but also ‘opportunities’ in terms of management. Ethnicity is not only an issue which calls for ‘management’ itself, but is itself a potential managerial resource. Ethnicity is important for organizations at both external (contextual) and internal (operational) levels. We use the example of Malaysia to highlight such issues.

Ethnicity as a Management Issue and Resource: Examples from Malaysia

Many emerging countries in Asia demonstrate a strong pattern of growth and potential of diffusion in science and technology that is dynamic and self-propagating. To elucidate the evolution in science and technology and the institutional dynamics that drive the self-propagating behavior, this paper examines the divergent models pursued by selected Asian economies in regard to science and technological catch-up. An analysis of papers and patents production for each nation was conducted to examine the indigenous science and technology capabilities. This study focuses on six major economies, namely China, Malaysia, South Korea, Singapore, Taiwan and Thailand. In addition, Japan, a country with advanced development of science and technology, is included for comparison. The findings provided insight and understanding of evolving science and technological waves and the dynamic potentials in science and technology. We demonstrate the pursued catching-up models that drive the self-propagating behavior and industrialization, thus providing a more complete understanding of the innovation systems than those examined in previous studies.

The pathway of development: science and technology of NIEs and selected Asian emerging economies

Flexible Production Systems and Local Machine Tool Subcontracting: Electronics ComponentTransnationals

Summary Over the last decades, Malaysia demonstrated significant economic performance as a result of its industrial development policies. In its transition toward a technology‐based industrialization during the 1990s, the Malaysian government has committed to develop a well functioning National Innovation Systems (NSI) to move its economy from labor‐intensive manufacturing to higher value‐added activities. This paper explains the significance of the Malaysian innovation system for its development and examines the process of economic development in manufacturing sectors as a result of assimilating, adapting, utilizing, and generating manufacturing technology. This study focuses on the competences to discover, assimilate, utilize, learn, and improve new industrial technology, which is a key determinant of the successful development of local manufacturing sectors.

Depicting the technology and economic development of modern Malaysia

Analyses the main trends in employment and real wages in manufacturing during the period 1985-97, and assesses the role of trade in generating these trends.

Manufactured exports, employment, skills and wages in Malaysia

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Manufactured exports, employment, skills and wages in Malaysia