Beyond the Developmental State: The Cultural Roots of “Guerrilla Capitalism” in Taiwan

This article seeks to contribute to the emerging literature on moving “beyond the developmental state” by tracing the important role of “guerrilla capitalism” in Taiwan's political economy. The success of small and medium enterprises (SMEs) with little linkage to the state in Taiwan strongly suggests that more than state leadership must have been involved in the island's “economic miracle.” The SMEs are quite important for the overall economy, especiaiiy the export sector where they have long accounted for more than half of total exports. Their success has resulted from the practice of “guerrilla capitalism” which includes aggressive and even audacious pursuit of business opportunities, extreme flexibility in rapidly filling even small orders, atten tion to quality and design, audacious bidding, participation in complex networks of subcontracting, and only partial observation at best of government regulations and international laws, such as those regarding intellectual property rights. The emergence of guerrilla capifalism, in turn, can be explained by the long‐sfanding challenge in Chinese history to “official” Confucianism by a “heterodox counterculture” that is quite conducive to entrepreneurship and small‐scale business activities.