The state, because of insufficient expertise of industrial electronization, took a reactive posture to evolve the coordination mechanism for the Internet industry.
Currently, the state plays a counselor to introduce the framework of e-business to the general public. Major policies, including information electronization aid,
electronizing value chains, establishing the demonstration system, and e-learning, are aiming at establish a e-business environment.
Generally speaking, the FPN of Taiwan’s e-business policymaking network represents a new development of economic governing model. Divergent from the statist and marketian theses, the emergence of FPN is a dedicate evolution of state governance in response to the business dynamics. Contrary to dirigisté wisdom enamoring state capacity to direct industrial development, FPN acknowledges relative business capacity of novel technology and preferred to sustains a moderate
coordination relationship between the state and relevant business / industrial
associations. This is a policy innovation of NICI to outsource policy implementation.
From figure 3, associations appear in the scope of the deliberation process of multiple policy centers. The blurring of the state / business boundaries may spawns superb conduits to flow information regarding vision of future industrial development and contributes to good policymaking. Consequently, NICI as the core of the FPN is not comparable to paramount economic apparatus we used to know in the East Asia.
Constrained by budgets and human resources, NICI could not assume power from related state organs discretionarily and unilaterally. Therefore, NICI that is embedded in FPN has limited autonomy and flexible capability regarding decisionmaking and policy execution.
{Figure 3 here}
The FPN also make the Internet industrial governance more transparent. The best mission NICI can carry is information exchange and aggregate center that expedites policymaking efficiency, and reconciles position different in order to reach policy equilibrium. Since most initiatives are contributed in bottom-up way, the initiative-motivators, whether the state managers or the societal actors, have full understanding of the policy. The communication process in FPN prevents general asymmetrical informational exchange between principal and agents.
The most prominent innovation of FPN comes from accountability. NICI is the central organ in charge of policy coordination. But the budget of sub-projects and implementation are operated by independent departments. In the case of getting budget from the source of technology development, it is certainly under the control and evaluation of NICI/STAG. For those sub-projects getting budget from the source of economic development or public construction, CEPD is in charge of supervision.
While most initiatives come from the bottom, the executive organ, either the public or the private, could direct supervise sub-projects. The supervision mechanism
substantially makes policymaking and implementation accountable to principles.
As figure 3 shows, extension of multiple policy centers are leading
recognizant organs that are responsible to sub-coordinate relevant agents during the policy making process. In times, policy center may compete with each other in specific policy turf. However, thanks to the horizontal structure of the FPN, most interests conflicts can be resolved through rational compromise and deliberation.
Stark ministerial rivalry, which occurs frequently in hierarchical coordination, is substituted by horizontal cooperation. In addition, as the development potential of the FPN is vivid, opportunities to absorb external resource to support initiatives proposed by policy centers may make the FPN more extended than currently plotted.
Conclusion
This paper presents a preliminary effort to achieve a new theory to interpret policymaking in Taiwan. As the conventional wisdom withers in the face of new condition, the network governance becomes a new guideline to understand economic policy. We also engineer Fungus Policy Networks to explain the policymaking process of the Internet industry. The network attributes, autonomy, capacity, transparency, and accountability, should be the main scale to gauge the viability of policy networks.
By applying FPN analysis, we illustrate the developmental trajectory of the Internet industry with five features. The story indicates proper-networked
arrangements of state-business relations are innovative as well as conducive to industrial development. We should notice that a factor, not less important than any actor analyzed in this article, might help the advent of FPNs in Taiwan is democracy.
Since the early 90s, the persistent process of democratization substantially dismantled hegemonic control of the state and drew more civil groups into the policymaking process. Especially in high-tech sectors, emergence of professionalism of industrial community becomes influential source for policy initiation. For some extent, professionalism can explain why most respondents implicated politics is not a
significant factor when plotting the Internet policy. Even after the first power turnover occurred in 2000 after DPP won the presidential election, the relationship between technocrats and the industry did not veer as shown in some sectors.
Several reflections are inspired from this paper. Firstly, the state-business relations do not disintegrate or retreat the state from the market in the age of
globalization.54 Contrary to the passive adjustment driven by the market dynamic, the autonomy and capacity of network governance perform as the filter to translate
international pressure and technological change as progressive momentum for the domestic industry. Secondly, as analyzed in this paper, the state-business relations should be flexible, and adaptable according to the business reality. The transitional process is hence dynamic, not static. Thirdly, institutions are creatable. Suited institutional innovation helps the state to intervene in volatile sectors. In the case of Taiwan’s Internet industry, the innovative establishment of NICI substantially cures departmentalism and avoid organizational rigidity. It is instructive that the state may achieve better outcomes by communication and coordination with informal
organizations, rather formal state organs. Indeed, We are shy away to provide a comprehensive explanation to the development of Taiwan’s Internet industry so far, though Taiwan is ranked at the leading spot regarding e-readiness. But the
development of FPN of Taiwan’s Internet industry should cast new light to the East Asian political economy.
.
54 Weiss, Linda. 1998. The Myth of the Powerless State (Ithaca, NY: Cornell Univ. Press).
Table 1: Selected Economist Intelligence Unit e-readiness rankings, 2003
E-readiness ranking Country 2002 ranking 2001 ranking1 Sweden 4 (tie) 6
2 Denmark 7 9
3 (tie) Netherlands 2 10
3 (tie) US 1 1
3 (tie) UK 3 3
6 Finland 10 8
7 Norway 11 (tie) 5
8 Switzerland 4 (tie) 11
9 Australia 6 2
10 (tie) Canada 9 4
11 (tie) Hong Kong 14 13
12 Singapore 11 (tie) 7
13 Germany 8 12
14 Austria 13 16
15 Ireland 15 14
16 South Korea 21 21
17 (tie) Belgium 16 19
17 (tie) New Zealand 18 20
19 France 17 15
20 Taiwan 20 16
21 Italy 19 22
22 Portugal 24 25
23 Spain 22 24
24 Japan 25 18
25 Israel 26 23
Source: EIU e-readiness rankings (2003).
Table 2: Economic governance: structure, exchange, and efficiency
Figure 1: Growth of Regular Internet Users in Taiwan
Jun-96 Dec-96 Jun-97 Dec-97 Jun-98 Dec-98 Jun-99 Dec-99 Jun-00 Dec-00 Jun-01 Dec-01 Jun-02 Dec-02 Jun-03 0%