Dancing with Giants

China, India and the global economy

Edited by L. Alan Winters and Shahid Yusuf

2007 The Internaltionl Bank for Reconstrauction and Development/ The World Bank and The Institute of Policy Studies

Chapter 7 Governance and Economic Growth by Philip Keeper

pp.220

“Even in countries with competitive elections and checks and balances, political market imperfections can weaken political incentives to pursue good governance outcomes (see Keefer and Khemani 2005). For example, when citizens are not well informed about the connection between political decisions on particular issues and their own welfare, as is often the case with governance reforms, politicians are ulikely to compete on those policy dimensions. Lack of education and of access to informaion , time lags, and a noisy economic environment full of shocks all can contribute to information problems. Another political market imperfection exists when parties cannot make political promises that are broadly credible to all citizens. Parties resort to appeals to those groups of citizens to whom they can make credible promises– but when those groups are narrow, incentives to improve governance for all citizens dwindle (Keefer and Vlaicu 2005). Again, isolated and poor populations are less likely to know of the relationship between political actions and the governance environment, or to appreciate the importance of the country’s governance environment for theris ow personal well-beign. Similarl, in countries riven by social tension, the costs of making credible political promises to all citizens dwarf those of making prmises targeted to individual groups. Each political competitor belongs to one of the groups and therefore is mistrusted by all ther others. “

Seems the biggest problems in Taiwan are 1. the lack to education: people don’t have enough knowledge and disscussion over social issues a and thus stop them from further realize how a politician or political policy really affects their welfare and daily life. 2.  High social tension and lack to consensus make parties to pursue narrow group of peopel instead to pursuing the best for most.