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Neo-liberalism and Domestic Capital: The Political Outcomes of the Economic Crisis in Thailand

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  • Kevin Hewison

Abstract

The 1997 economic crisis in Thailand provided an opportunity for a reinvigoration of neo-liberal economic policies. International financial institutions, together with Thailand's Democrat-led government, emphasised further market reforms, liberalisation, deregulation, decentralisation, privatisation and a reduced role for the state. The deep economic downturn saw a popular rejection of such policies, meaning that the neo-liberal interregnum was short-lived. The 2001 landslide electoral victory of the Thai Rak Thai Party symbolised the intensity of opposition to neo-liberalism. It also showed that national governments remain critical in shaping markets and that domestic economic actors continue to have significant political roles. In Thailand, far from neutering domestic capital's political capacity, the crisis and opposition to neo-liberalism saw this enhanced. One reason for this was that neo-liberal restructuring was not simply about the efficient operation of the market. Rather, it demanded a fundamental transformation of the operations of government and of the ways that business was organised and conducted. This threatened domestic capital. Its economic survival required that it seize the state so that it could control economic policy-making. This was achieved through the Thai Rak Thai electoral victory and its subsequent rule, where the protection of domestic capital's interests was achieved through a re-negotiation of its social contract with other classes.

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  • Kevin Hewison, 2005. "Neo-liberalism and Domestic Capital: The Political Outcomes of the Economic Crisis in Thailand," Journal of Development Studies, Taylor & Francis Journals, vol. 41(2), pages 310-330.
  • Handle: RePEc:taf:jdevst:v:41:y:2005:i:2:p:310-330
    DOI: 10.1080/0022038042000309269
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    Cited by:

    1. Okabe, Yasunobu, 2013. "Financial Restructuring after the 1997 Crisis and Impact of the Lehman Shock: Path Dependence of Financial Systems in Korea and Thailand," Working Papers 51, JICA Research Institute.
    2. Veerayooth Kanchoochat, 2014. "Coalition Politics and Reform Dynamics in Thailand," GRIPS Discussion Papers 13-26, National Graduate Institute for Policy Studies.
    3. Edo Andriesse & Guus Westen, 2009. "Unsustainable varieties of capitalism along the Thailand–Malaysia border? The role of institutional complementarities in regional development," Asia Pacific Journal of Management, Springer, vol. 26(3), pages 459-479, September.
    4. Chau-kiu Cheung & Raymond Chan & Wing-chung Ho, 2014. "Feeling Close to Fellow Citizens in Hong Kong, Korea, Taiwan, and Thailand," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 119(1), pages 25-48, October.
    5. Petar Stankov, 2018. "The Political Economy of Populism: An Empirical Investigation," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 60(2), pages 230-253, June.
    6. Mehmet Hecan, 2016. "Dynamics of Institutional Proliferation in Financing for Development: The birth of the AIIB," Development, Palgrave Macmillan;Society for International Deveopment, vol. 59(1), pages 158-166, June.
    7. Andriesse, E., 2006. "Regional varieties of capitalism': inter-firm relations and access to finance in Satun (Thailand) and Perlis (Malaysia)," ISS Working Papers - General Series 19192, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.
    8. John Walsh, 2013. "The Role of Clinical Governance in the Health Management Systems of Thailand," Journal of Social and Development Sciences, AMH International, vol. 4(10), pages 461-466.

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