Taiwan, officially the Republic of China, with a 2019 population of about 23.6 million, has successfully taken advantage of its location and used international trade to become one of the “Asian Tigers” and the world’s 21st-largest exporter. During the last half century, Taiwan transformed its economy to one that emphasizes economic liberalization, industrial products and export expansion. The most notable developments in the past two decades were the renewal and growth of Taiwan’s trade and investment with China, the upsurge of Taiwan’s outward FDI, and growing reliance on foreign contract workers.

Questions

1. Explain which of the theories relate to Taiwan’s trade policy during each of the eras described in the case.

2. Map 6.1 shows that 64.9 percent of Taiwan’s exports go to only five  countries/territories. Which trade theories may help to explain this concentration and why?