Sustainability impact of economic integration: The case of flying geese and path dependencies in East Asia

In East Asia, the path of economic integration that started at the end of the second World War took a distinguished path. Energy intensive industrialization expanded into countries with fewer development options. Aided by official development assistance (ODA) and Foreign Direct Investment (FDI), the emergence of production networks across East Asia, permitted the second and third tier economies to catch up to advanced economies in technology and skill upgradation, and narrow the developmental gaps. The pattern of East Asia’s catch up economic growth has been extensively studied, with the “flying geese” (FG) model being the most well-known paradigm. This process of catch up also led to increased emissions and creation of air, water and soil pollutions, and the movement of the intensity of emissions and pollutants to second and third tier economies. From the perspective of an energy-development nexus, does it mean that East Asia’s growth pattern still could not break away from the historical path of dependency on energy intensive industrialisation observed elsewhere?

We ask three questions. What factors lead to the emergence and subsequent dispersal of the flying geese? What were the main characteristics of integrated energy and environmental policy formulation during the dispersal, and what lessons could be learned from those experiences for a sustainable future? To our knowledge, our work is the first such direct attempt to understand the linkages of the FG model and energy policies in East Asian economic development. Using historical data on trade and energy consumption, we demonstrated that the East Asian governments have taken proactive measures to address energy intensity concerns, and the policy effort has been further intensified. We use regression analysis on data from the United Nations Comtrade Database and the International Energy Agency with structured interviews to obtain firm-level data on selected sectors.

We first give a brief overview of the FG model, to describe general features of gaggles of flying geese. We highlight the process of their foundation and factors leading to formation of their flights, such as policy support provide by the government for export substitution. We then focus on low emission technologies that accompanied the formation of the flying geese and assess how so called Asian values figure to integrated energy and environmental planning. Finally, we draw lessons learned from the FG model, for its potential application in solving global sustainability challenges.