How Asia Works by Joe Studwell Summary

How Asia Works analyzes why Asian economies like Japan, South Korea, and China succeeded while others (Indonesia, Philippines) lagged. Joe Studwell identifies three pillars: land reform to boost agriculture, export-focused manufacturing with state discipline, and strict financial regulation to direct capital. The book contrasts developmental strategies across nine countries, debunking myths about Asia’s uniform growth.

This book is essential for economists, policymakers, and students of development economics. It’s also valuable for business leaders and investors seeking insights into Asia’s markets. Bill Gates praised its analysis, calling it “refreshingly clear” for understanding economic success factors.

Yes. The Financial Times called it “pithy, well-written, and intellectually vigorous,” while Bill Gates recommended it for its actionable insights. It combines rigorous research with accessible narratives, making it a cornerstone for understanding Asia’s rise.

Studwell argues that:

• Land redistribution maximizes agricultural productivity.
• Export discipline forces manufacturers to compete globally.
• Financial regulation prevents capital misallocation.

These policies drove success in Japan and South Korea but were absent in underperforming Southeast Asian economies.

China’s reliance on state-owned enterprises (SOEs) creates inefficiencies, particularly in advanced manufacturing. Studwell highlights mismatches between SOEs in early-stage industries and less competitive downstream sectors, risking long-term imbalances.

Land reform transforms small farms into high-productivity units, generating surpluses to fund industrialization. This “kick start” was critical in Northeast Asia but neglected in Southeast Asia, perpetuating poverty.

Countries like Indonesia and the Philippines failed due to absent land reform, weak export discipline, and cronyist financial systems. Elite-controlled policies stifled equitable growth, unlike Japan or South Korea’s structured approaches.

Governments must mandate that manufacturers compete internationally, not just domestically. This pressure drives innovation and efficiency, as seen in South Korea’s steel and electronics industries.

A journalist with decades in Asia, Studwell combines fieldwork with academic rigor. His prior books (Asian Godfathers) and role founding the China Economic Quarterly lend authority to his analysis.

While Asian Godfathers exposes oligarchic failures in Southeast Asia, How Asia Works offers a broader framework for developmental success, emphasizing policy over individual corruption.

Some scholars argue Studwell oversimplifies complex economies. However, his three-pillar model is widely praised for clarity, offering a actionable blueprint for policymakers.

Bill Gates notes its lessons could inform African strategies if adapted to local contexts. Studwell’s upcoming book How Africa Works expands on these ideas, supported by the Gates Foundation.