Commercial Power Centers in Indonesia. A New Paradigm to Analyze the Role of Business Groups in Policy Making
Abstract
Crony capitalism and cozy relations between governments and local business groups have been widely considered as the root cause for the crisis that has swept East Asia in the second half of 1997, leading to the demise of Asia's longest serving president, President Suharto. Prior to the onset of the crisis, several policy analysts and observers of emerging market economies had underscored the increasing influence of large business groups on policymaking in these countries. This study seeks to address these issues by providing an integrated framework of analysis to understand and assess the role and influence of commercial power centers (CPCs)-on economic policymaking. We define CPCs as: Any group, combination, or coalition of large aggregate size, that seeks to influence the design and implementation of government economic policies to suit its diversified economic interests. The analytical approach is three-pronged: (1) describing and critiquing literature on interest groups, collective action, and economic regulation to develop a model describing the behavioral characteristics of CPCs placed in a quasi-market for political influence on economic policymaking; (2) employing historical analogies appropriate for understanding today's emerging market economies; (3) applying the model to Indonesia to add texture to the analysis and illustrate its usefulness.
Document Details
- Document Type
- Technical Report
- Publication Date
- Jan 01, 2000
- Accession Number
- ADA381959
Entities
People
- Hugh P. Levaux
Organizations
- RAND Corporation