Critical transformations and global development

Area Development and Policy

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Critical transformations and global development: materials for a new analytical framework Jeffrey Henderson & Nicholas Jepson To cite this article: Jeffrey Henderson & Nicholas Jepson (2017): Critical transformations and global development: materials for a new analytical framework, Area Development and Policy, DOI: 10.1080/23792949.2017.1369856 To link to this article: http://dx.doi.org/10.1080/23792949.2017.1369856

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AREA DEVELOPMENT AND POLICY 2017, VOL. 00, NO. 00 https://doi.org/10.1080/23792949.2017.1369856

RESEARCH ARTICLE

Critical transformations and global development: materials for a new analytical framework a

Downloaded by [University of Bristol] at 03:45 20 September 2017

Jeffrey Henderson and Nicholas Jepsonb

ABSTRACT This paper addresses the disconnection between current analyses of global development and 21stcentury developmental realities. It argues for a reworking of the development sciences on the basis of ‘transformation analysis’, attending, in particular, to those phases in longer-term social change that it characterizes as periods of ‘critical transformation’. Taking ‘the global’ seriously as an analytical category, it argues for an innovative development science capable of application in both the ‘developing’ and ‘developed’ worlds, and thus of yielding more appropriate practical and policy guidance. The paper briefly explores the empirical utility of transformation analysis by attention to the recent development histories of Hungary and Malaysia. ARTICLE HISTORY Received 27 February 2017; Accepted 17 August 2017 KEYWORDS global development, transformation analysis, economic, social and political change, development trajectories, Hungary and Malaysia

摘要关键转型与全球发展 – 对新分析框架的思考. Area Development and Policy. 本文针对目前全球发展分析与21世纪发展实情之间存在脱节的问题进行探讨，认为应在‘转型分析’的基础上对发展科学进行修订，尤其应关注长期社会变化中的那些‘关键转型’时期。本文将‘全球’作为分析范畴，认为应建立一种在‘发展中’和‘发达’国家及地区均可适用的创新发展理论，从而可以提供更适合的实践和政策指导。本文通过分析匈牙利和马来西亚近来的发展情况简要探讨了转型分析的实证效用。] 关键词全球发展, ；转型分析, ；经济、社会和政治变化, ；发展轨迹, ；匈牙利和马来西亚

RESUMEN Transformaciones críticas y desarrollo global. Area Development and Policy. En este artículo se aborda la desconexión entre los análisis actuales del desarrollo global y las realidades de desarrollo en el siglo XXI. Se

CONTACT a(Corresponding author) [email protected] School of Sociology, Politics and International Studies, University of Bristol, Bristol, UK bGlobal

Development Institute, University of Manchester, Manchester, UK

© 2017 Regional Studies Association

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Jeffrey Henderson and Nicholas Jepson

argumenta que es necesaria una modificación de las ciencias de desarrollo a partir de un ‘análisis de transformación’, prestando atención sobre todo a las fases del cambio social a largo plazo que se caracterizan como periodos de ‘transformación crítica’. Asumiendo seriamente que el término ‘global’ es una categoría analítica, se aboga por una ciencia de desarrollo innovadora que se pueda aplicar tanto en mundos ‘en desarrollo’ como ‘desarrollados’, y por consiguiente producir una guía más apropiada para la política y práctica. En este artículo se analiza brevemente la utilidad empírica del análisis de transformación enfocándose en las recientes historias de desarrollo de Hungría y Malasia.


PALABRAS CLAVE desarrollo global, análisis de transformación, cambio económico, social y político, trayectorias de desarrollo, Hungría y Malasia

АННОТАЦИЯ Критические трансформации и глобальное развитие: материалы для новой схемы анализа. Area Development and Policy. В настоящей статье рассматривается разрыв между современными походами к анализу глобального развития и реалиями развития в 21-го веке. Автор призывает пересмотреть подходы к исследованиям в области развития на основе «анализа трансформаций», уделяя внимание, в частности, тем этапам в долгосрочных социальных изменениях, которые можно охарактеризовать как периоды «критической трансформации». Принимая «глобальность» как серьезную аналитическую категорию, статья утверждает целесообразность развития инновационной науки о развитии, которая сможет найти применение и в ‘развивающихся’ и ‘развитых’ мирах, и тем самым обеспечить более адекватные практические и политические ориентиры. В статье кратко анализируются эмпирическая полезность анализа трансформаций с упором на недавнюю истории развития Венгрии и Малайзии. КЛЮЧЕВЫЕ СЛОВА глобальное развитие, анализ трансформаций, экономические, социальные и политические изменения, траектории развития, Венгрия и Малайзия

INTRODUCTION Development, as a project for delivering better futures for the vast majority of humanity, is in serious trouble. This is the case in both ‘developing’ countries and in many parts of the ‘developed’ world. Increasing inequality, stagnating poverty reduction, environmental despoliation and climate change, widespread corruption, rising public and private debt, population displacements and large-scale migration coalesce with myriad other factors to impact global humanity negatively. As a consequence, we stand at a ‘hinge of history’ (Appelbaum & Henderson, 1995), one of those moments in human evolution when the superimposition of multiple contradictions, unresolved from the past, but impacted by new and sometimes unanticipated elements, is generating extraordinary economic, political and geopolitical turbulence and, with it, growing uncertainty for societies, communities and individuals alike. Contemporary global turbulence is compounded by explanatory uncertainties in the domain of development science.1 For a considerable period of time we have lacked consensus on an intellectual agenda capable of stimulating credible theorizations of our problems; theorizations that could inform the development of policies and strategies adequate to the enormity of the difficulties we confront. Today, for instance, the intellectual spectrum that bears on the problems of global development and its future ranges – in the realm of political economy alone – from

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Critical transformations and global development: materials for a new analytical framework

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arguments that call merely for better market regulation to analyses that suggest we may be witnessing the beginning of the end of capitalism (cf. French 2010; Streeck, 2016). In this paper, a possible route out of our scientific dilemmas is explored. Specifically, it investigates the possibility (and viability) of reconfiguring the study of global development around the concept of ‘transformation’, with an analytical focus on the dynamics that form, impact and drive forward periods of ‘critical transformation’ (CT) as these arise in particular national and subnational spaces.2 It begins with a critical review of a variety of attempts to understand global development and, in so doing, highlights three key problems that tend to work against the possibility of any of them – though to different degrees – being capable of delivering theorizations adequate to the task at hand. Responding principally to the first two of these, the paper then advances ‘transformation analysis’ (TA) as an alternative basis for grasping the dynamics of global development. Subsequently, by means of brief studies of two countries at different levels of development (though, arguably, in periods of CT) – Hungary and Malaysia – the paper provides an assessment of the empirical viability of transformation analysis.

CONCEPTIONS OF GLOBAL DEVELOPMENT: A NECESSARILY BRIEF EXPLORATION Concerned with the analysis of global development and its policy-practical implications, the ultimate aim of this paper is to encourage the emergence of a development science appropriate to both the developing and developed worlds while remaining sensitive to national and subnational variations. Given this and the impossibility of doing justice, in the context of a short article, to the colossal literatures that concentrate on one or the other ‘worlds’, the focus here will be on work that at least implicitly claims a global remit for its analytical frame: namely, those that approach the dynamics of development in ways that, at least in principle, are relevant to developing and developed countries alike.

Attending to development At the risk of simplification, the analysis and policy practice of global development, at least since the decades of ‘high’ Keynesianism (the 1950s and 1960s) and its Prebisch–Singer inspired corollaries (import substitution industrialization, for instance), has been dominated by the tensions between the appropriate roles for private property and markets, on the one hand, and state interventions – both regulatory and in terms of the provision of goods and services – on the other. Since the 1980s, those privileging the former – neoliberal approaches – have tended to dominate. More recently, and particularly since the economic crises of the late 1990s/early 2000s (in East Asia, Argentina etc.) and more widely after 2008, approaches that critically engage with neoliberalism and reject many of its assumptions and policy prescriptions, have been re-energized and gained credibility in some parts of the world. While neoliberal development strategies were near-hegemonic at the start of the millennium, across the majority of developed and developing countries alike, evidence of their financial and, more widely, economic failures, together with growing recognition of the environmental and socially destructive elements associated with them, have led to a search for alternative theories and projects: from ‘neodevelopmentalism’ in parts of Latin America and Africa to anti-austerity movements in Greece, Spain, Britain and elsewhere in Europe. Many of these have brought the state ‘back in’ while emphasizing the democratic deficits that have been associated with many neoliberal strategies. While neoliberalism has always been a hybridized phenomenon (Brenner, Peck, & Theodore, 2010), leading to a continuum of political–economic forms, growing evidence of its socially damaging effects and inherent economic instabilities gave rise to considerable



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intellectual and political criticism, the well-known work of Wilkinson and Pickett (2009), Piketty (2014) and Streeck (2014) being indicative of the former and movements such as the World Social Forum, Occupy, Podemos (Spain) and Momentum (Britain) of the latter. Even though the neoliberal ‘Washington Consensus’ became for a while the paradigm for the work of most international development agencies, one of them – the United Nations Development Programme (UNDP) – has long stood out for its commitment to the idea that human development could not be reduced to economic development and certainly not to ‘market efficiencies’ (cf. Nederveen Pieterse, 2014). More than anything, however, it was the descent into what ultimately became near global economic crisis that triggered a deepening critique of neoliberal approaches to global development. Though there were early warning signs – particularly the Mexican ‘peso crisis’ of 1982 – it was the relation between the ‘financialized’ global accumulation regime and the East Asian economic crisis of the late 1990s (e.g., Haggard, 2000, Henderson, 1999, Wade, 1998) – quickly followed by the Argentinian crisis of 2001 – that caused even some global governance insiders to question the Washington Consensus. Led by the World Bank’s former chief economist, Joseph Stiglitz (e.g., 2003, 2007), a ‘Post-Washington Consensus’ emerged and with it recognition that the radical forms of neoliberalism underpinning the policy agenda of the World Bank, the International Monetary Fund (IMF) and other development policy agencies were counterproductive. The way forward, Stiglitz and others in effect argued, was to re-create the intellectual and policy space for selective state intervention to support the private and public sectors alike in an effort to secure growth with reasonable social equity. The ‘great recession’ subsequent to 2008 and the disruptions to the social and political order that it has engendered have served to underline the urgency of the search for development strategies beyond neoliberalism (e.g., on Britain, see Green & Hay, 2015). The idea that the state was, and inevitably had to be, a significant development actor took a major practical step forward with the growing economic and political significance of the BICs (Brazil, India, China) and of Russia. With the rise of China in particular – a country with an essentially Leninist state at its heart, but with extraordinary successes in economic growth, employment generation, poverty reduction etc. – it became difficult to argue against the idea of a central role for the state in economic and social progress. With the externalization of the Chinese political economy and as a significant part of that, its state-owned enterprises, the state as a key development actor elsewhere in the world – East Asia, Africa, Latin America and, more recently, Europe – was very much back on the agenda (cf. Henderson, Appelbaum, & Ho, 2013; Ma & Overbeek, 2015; Power, Mohan, & Tan-Mullins, 2012; Yeung, 2017). Predating neoliberalism and continuing as a subaltern strand through to the present day has been a tradition of analysis that began as ‘dependency theory’ (e.g., Amin, 1974; Baran, 1957; Cardoso & Faletto, 1979) and subsequently became absorbed into, and was reconstructed by, world-systems analysis (e.g., Wallerstein, 1974). Though focused on what used to be known as ‘Third World’ countries, the argument was that constraints on development were products of structurally asymmetric relations with countries of the ‘First World’. ‘Underdevelopment’, therefore, was not merely a socio-economic condition that could be changed through ‘development’, but an active process derived from, and reproduced by, the historical and contemporary forms of engagement between the First World and the Third: Europe underdeveloped Africa in Walter Rodney’s (1972) famous phrase. ‘The national’ and ‘the global’ Whatever the intellectual advances made by dependency theory – and they were considerable – it had one analytical affinity to neoliberalism: both were perspectives rooted in discourses of ‘the national’, and thus ‘the international’. In this sense it suffered from similar problems as the vast majority of the social sciences: it was state-centric in its assumptions and analyses. Exclusive attention to this level of aggregation was perhaps understandable at the time dependency theory




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first emerged, given that it predated the era of neoliberal globalization. Today, such perspectives have become less useful in light of the changes that have occurred in the spatial organization of economic and political activities which ‘increasingly slice through, while still being unevenly contained within, state boundaries’ (Henderson, Dicken, Hess, Coe, & Yeung, 2002, p. 437). Among the currently significant approaches to development that have arguably done better – in the sense that they epistemologically foreground the dialectic of ‘the global’ and ‘the national/ subnational’ in their analyses – world-systems and global production network (GPN) analysis have arguably been the most prominent.3 With regard to the former, the principal (and related) foci for analysis arguably have become the rise and fall of economic and political hegemonies, on the one hand, and long cycles of capital accumulation, on the other (Arrighi, 1994, 2007; Babones, 2015; Chase-Dunn, 1998). As such, while substantial theoretical–historical contributions to development analysis have been made (e.g., Moulder, 1977, on Japan and China; and Hung, 2011, on China), only occasionally have analyses of contemporary sub-global problems been delivered (e.g., Hung, 2015, on China; and Jepson, 2015, on Zambia, Ecuador and Jamaica). Perhaps as a consequence, world-systems analysis has largely been unable to fashion an agenda to help guide the course of social, economic and political change in the contemporary world. In this latter sense, GPNs and their cognate tradition of analysis, global value chains (Coe & Yeung, 2015; Gereffi, Humphrey, & Sturgeon, 2005; Henderson et al., 2002), have done better. Originally informed by world-systems analysis, they have gone much further in advancing dialectical analyses of global–local relations in the study of contemporary economic and social development. Unlike their forebear, however, the insights they have generated have also helped to influence policy thinking in a number of national and international agencies (e.g., the International Labour Organization (ILO) and the World Bank; e.g., Cattaneo, Gereffi, & Staritz, 2010; Palpacuer & Parisotto, 2003). Debilitating inadequacies Embedded within the traditions of development science surveyed here – though to variable extents – are three general issues that constrain their prospects of delivering analyses adequate to contemporary conditions.

Development as a developing country problem. Only world-systems and GPN analysis, Castells’ work on globalization (e.g., Castells, 2000a) and cognate contributions (e.g., Sklair, 2002) conceptualize ‘the global’ as a level of analysis in its own right. For the others, economic, political and social change associated with ‘development’ is perceived as being restricted to developing countries only. Change-as-development is seen as an issue solely for the Global South. The Global North is assumed to be ‘developed’, and the development process there is presumed to have finished. In this way, the notion of development and its attendant discourses serve to fracture the unity of global change; the reality of the global political economy and its constituent societies as a dialectical whole in constant transformation is effectively denied. With this intellectual background it is no surprise that notional hierarchies of development have emerged in which the Global North is at the top and the Global South (in varying levels of human degradation) at the bottom. From there it has been but a short step to the assumption – indeed the ontology – that development is a process of historical change in which the ‘developed world’ assists the ‘developing world’ to ‘develop’, but crucially, to develop largely in the former’s self-image, and definitely not vice versa. Euro/American centrism. The conceptions of development reflected in these traditions dominate contemporary discourses and policy agenda and are imbued with European/ American-centric notions of ‘progress’ and ‘modernization’. They emerged from the European Enlightenment of the 18th century, were elaborated and deepened during the



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classical colonialisms of the 19th and first half of the 20th centuries, and have continued to inform perceptions and thinking through to the present day (e.g., Escobar, 1995; Rist, 2014; Santos, 2016; Wallerstein, 2001, ch. 7). The utility of much ‘Western’ foreign aid and advice – behind which lie assumptions that their routes to development are universally applicable – is now being questioned by even some of the key actors themselves, including the Organisation for Economic Co-operation and Development’s (OECD) Development Assistance Committee (Humphrey, 2010). On a wider plane, Chang (2007) shows how the conception of ‘development’ reflected in orthodox economic theory and notions of ‘good governance’ has not merely been inappropriate, but has created serious problems for the peoples of the Global South. Behind these arguments is a sense that the root of the problem is an inappropriate intellectual and socio-political framing of the entire development project and thus the tenor of the research and policy discourses associated with it. The growing impact of China and other BICs as development actors compounds this suspicion. On an intellectual plane, how can China, for instance – itself a developing country, but with a dramatically different vision of modernity and progress relative to North America or Western Europe (Jacques, 2012) – be seen as assisting other parts of the developing world to ‘develop’ if we stick with the categories of traditional development science?4 Clearly, this becomes a difficult task unless the categories we use to think about development are revised and, in the process, a wider variety of conceptions of possible futures than has been typical through to the present is envisaged.

Theorizing ‘after the fact’ and anticipating the future. Almost all development science (and social science more generally) suffers from one or both of the following epistemological problems. They rely on the past (including ‘present history’) for the empirical bases of their theoretical constructions and, additionally, some of them construct formal models on the basis of quantified data regarded as plausibly representing the present and/or a series of ‘snapshots’ of reality at particular moments in time and on those bases sometimes attempt to ‘predict’ the future. While these epistemological orientations and their related methodologies can produce credible routes to knowledge of the social world (e.g., Evans & Rauch, 1999; Henderson, Hulme, Jalilian, & Phillips, 2007), they are, on their own, inadequate for the task of identifying future trajectories of change that are imminent in the present and have been conditioned by structures and processes derived from the past. It is arguably the capacity to apprehend and comprehend such trajectories, however, that is central to the possibilities of building a development science fit for 21st-century realities.

TOWARDS TRANSFORMATION ANALYSIS To move forward to a new framework we need to alter the constructs we use to imagine and analyze historical change, its rhythms and trajectories, not merely in the developing world, but globally. In particular, we need a science that can grasp the dynamics of change, and the actors involved, that are both internal and external to the particular territorial spaces in question (subnational, national, cross-border, world-regional). In other words, we need an appreciation of the dialectic between what Castells (2000a, ch. 6; Castells and Henderson, 1987) calls the ‘space of places’ (indigenous social, economic, political, cultural, physical and natural assets) and the ‘space of flows’ (investment, power, people, information, imagery etc.), as well as the ways in which this dialectic works out under particular historical circumstances. A fruitful way forward might be to construct a new analytical scheme around the dynamics of ‘transformation’ (Henderson et al., 2013, pp. 1235–1239). In particular, and as we argue below, what may be needed is a reorientation of research around tendencies towards ‘critical transformation’ as these emerge in particular periods and at a variety of spatial levels. Among other things, such an analytical scheme (and associated discourses) has the potential to advance




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an appreciation of development as a globally integrated phenomenon, thus distinguishing it from its conceptualization in current theory and policy as something relevant only to the Global South. Unlike discourses of development, therefore, those of transformation offer the prospect of global analyses of the dynamics and consequences of change that, in principle, are relevant for ‘developing’ and ‘developed’ countries alike. The notion of transformation encourages a conception of economic, social and political change that explicitly recognizes that change processes can potentially deliver a wide range of possible outcomes. Implicit in this conception and its attendant discourses is an appreciation that while a known starting point for the change process is obviously assumed, unlike transition discourses, for instance, it does not presuppose that we know the endpoint; rather, the endpoint of the change process is recognized to be unknown (Henderson, 1998, ch. 1). Consequently, transformation discourses have the capacity to avoid the a priori reasoning associated with much mainstream social science, including development science. In helping to avoid analyses that implicitly (and unconsciously) incorporate a predefined endpoint for whatever change process is being studied (from the impacts of building a trans-oceanic canal in Nicaragua, say, to anti-democratic impulses in Poland; Garton Ash, 2016; Watts, 2015), transformation discourses allow for the possibility of openended reflection on the dynamics and consequences of change. This is important analytically as it encourages the avoidance of the premature theoretical closure typical of many traditional development discourses (be they informed, for instance, by neoclassical economic theory or some forms of radical political economy) and thus some of the pitfalls of earlier and current policy engagements with economic and social development (the ‘structural adjustment’ agenda of the World Bank and the IMF being cases in point). Additionally, transformation discourses are likely to offer further advantages: (1) the prospect of learning and policy transfers from the Global South to the Global North, as in the case of New York City’s adoption of anti-poverty advice from Brazil (UNDP, 2013, p. 85), and not merely vice versa; (2) the ability to analyse the dynamics and consequences of change wherever they arise (even in the world’s most developed countries) by applying essentially the same conceptual apparatus; and (3) help open the field to alternative perceptions and voices and thus encourage analysts to transcend Euro/American centrism.

Definitional issues Before turning to an application of TA to the cases of Hungary and Malaysia, we first need to clarify the nature of the analytical categories we seek to mobilize and, subsequently (in the following section), some of the theoretical and methodological issues that underlie our application of them to concrete experiences of development and change. For heuristic purposes, transformations can be comprehended historically as four distinct, but interrelated, phases: ● Evolutionary transformations (ETs). While change is at the core of all ecological systems,

including human societies, for much of recorded history through to the first waves of European colonization from the end of the 15th century and capitalist industrialization from the 18th century, it seems to have been relatively slow and evolutionary. While ET periods may be less of a feature of most human societies today (due to climate change and the myriad processes collectively known as ‘globalization’, including revolutions in communications technologies), it can be seen as a baseline for change that takes place within coordinates set by an interaction of forces whose dynamics – at least in given places – are relatively well understood and unlikely to change rapidly. ● Critical transformations (CTs).5 Transformations are inevitably uneven over space and time. The dynamics of capital accumulation and the dialectic of places and flows associated with it impact particular cities, regions and other territorial spaces at different times and in different sequences. In the process ‘new’ contradictions that might originate in environmental, social



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or economic disruptions (for instance, desertification, large-scale migrations, or unemployment occasioned by shifts in the accumulation cycle and thus the locations of ‘creative destruction’) become superimposed on one another and on pre-existing ones such that the velocity of the change process begins to increase. With it, the dynamics and consequences of change become more volatile and their ‘management’ by governments and other agencies more difficult and less certain. The possibility of new or alternative development trajectories sometimes begins to emerge.6 In these contexts, societies enter periods of CT. ● Critical conjunctures (CCs). Should the volatility associated with CTs develop further and deepen, rather than being effectively managed or resolved, CCs tend to emerge. For example, while China’s development project arguably has entered a CT phase (associated, in part, with contractions in global demand and tendencies towards over-accumulation, mitigated, to some extent, by China’s foreign investment strategies), the tensions associated with the government’s attempt to switch the country’s growth model from an export to a more domestically driven one (cf. Hung, 2015; ten Brink, 2013) could well result in the emergence of a CC. Similarly, but in a very different development context, Britain’s badly asymmetrical and low-productivity economy, coupled with its dysfunctional, premodern state, has arguably contributed to the country’s current phase of CT (cf. Henderson & Ho, 2014) and, subsequent to the support for exiting the European Union (EU) in the 2016 referendum, the possibility of an impending CC. Importantly, a CC phase tends to lead to a shift in the developmental trajectory, whether this is by way of a resolution of the compacted tensions and conflicts typically associated with CCs or by means of a transition to a crisis phase. In other words, in the context of a CC, trajectories to the future become indeterminate in the sense that there tend to be a variety of possible resolutions to the particular problems that CCs generate. ● Crises. Depending on their composition and the ever-present possibility of unanticipated contingencies being inserted into the historical mix (e.g., political assassinations or environmental catastrophes such as volcanic eruptions, hurricanes etc.), CCs can sometimes transition into crises of the prevailing development project, presaging political– economic collapse. The East Asian economic turmoil of the late 1990s, which disrupted three decades of robust development in parts of the region, is an example of a key moment in the history of neoliberalism and financialization – and the contradictions associated with them – that could be reinterpreted by mobilizing CT/CC categories to analyse the developmental trajectories of the various countries in the preceding period. In terms of TA, however, only in Indonesia, where the Suharto regime was toppled, can the term ‘crisis’ be appropriately employed as an analytical category (cf. Henderson, 1999).

Theoretical and methodological issues The multiple problems with which contemporary global development is afflicted obliges us, inter alia, to search for alternative conceptions of long-term economic, political and social change. In so far as TA may be a relevant conception, it is one that seeks to identify temporal patterns of historical social change. In this it shares some commonalities with the concept of path dependence (Arthur, 1989; Mahoney, 2000; Pierson, 2000) and related ‘punctuated equilibrium’ models of change (Krasner, 1984; Steinmo, Thelen, & Longstreth, 1992). While there is insufficient space here to do justice to the debate around evolutionary and path-dependence arguments (Blyth, Hodgson, Lewis, & Steinmo, 2011; Goldstone, 1998; Howlett, 2009; Streeck & Thelen, 2005), it is useful to contrast such models with TA as a means of clarifying our claims as to the sources and sequencing of change underpinning TA. In particular, we engage with two linked questions as to the nature of change: (1) what is the extent to which change occurs through continuous adaptive processes versus sharp




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discontinuous breaks?; and (b) what is the mix of, and relationship between, the exogenous and endogenous forces involved? Most accounts of path dependence begin with a switching point or ‘critical juncture’ (Collier & Collier, 1991) where a contingent event (perhaps of little apparent initial significance) serves to select a particular historical path and foreclose alternatives. Once a direction of travel is embarked upon in this way, positive feedback effects tend to ‘lock-in’ and strengthen the trajectory.7 Path dependence thus juxtaposes discontinuous critical junctures (causal production) with subsequent stretches of stability and irreversibility (reproduction). Using TA concepts, this kind of a sequence is comparable with a CC being successfully resolved and then succeeded by a phase of ET. However, path dependence’s main focus is on explaining the emergence of persistent continuities from episodes of discontinuous change: gradual change is absent or de-emphasized. In TA, by contrast, processes of continuous change are constant and one of the main mechanisms through which transformation occurs. ET phases are conceived of as periods where stable trajectories are reproduced and during which social and economic dynamics are relatively well contained. Nevertheless, any such trajectory does not tend towards an equilibrium state, as in path dependence, but is gradually undermined through the playing out of its internal contradictions, in combination with new dynamics derived through constant interaction with the global political economy. Once established, therefore, any ET tends eventually towards a subsequent CT phase which follows the same overall direction of travel, but where an intensifying interplay of contradictory forces produces sufficient turbulence that this development trajectory begins to lose stability. In this sense our analysis is similar to regulation theory’s explanation of the growing contradictions and turbulence seen in the United States from the late 1960s through the 1970s, destabilizing the prevailing Fordist/Keynesian trajectory (Aglietta, 2015). Our conception, whereby ETs turn into CTs through processes of continuous change rather than by episodes of discontinuous change, helps to illustrate how the two types of phase are analytically differentiated. A continuum rather than a definite break point separates an ET phase from the CT that follows. We can therefore think of an ET–CT sequence as an unbroken period in which a single overall political–economic direction of travel obtains, heuristically divided into two sub-periods of greater stability (ET) and greater turbulence (CT) (Figure 1). The utility of drawing this distinction lies in the claim that only after the end of an ET phase and the beginning of the subsequent CT phase is any substantive break with the current trajectory ‘up for grabs’. Accelerating and amplified contradictions make management and reproduction of the overall trajectory more difficult, breeding volatility and fragility as well as creating spaces in which potential alternative trajectories begin to gestate. These posited conditions during a CT

Figure 1. Continuous and discontinuous processes of change across transformation analysis (TA) phases.



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phase are similar to Sewell’s (1996) notion of structural dislocation where regulatory structures are becoming weaker and less able to contain disruptive occurrences. In an ET phase such disturbances would be absorbed or deflected, but during a CT phase they become ever more likely to act as a trigger event which produces a disarticulation of the prevailing trajectory and begins a CC. The build up to the Argentinian debt default of 2001 provides an illustration of this sort of sequence. A growing recession from the late 1990s might be argued to mark the move from ET to CT phases. At this point, however, any break with the country’s neoliberal trajectory appeared unlikely (doubly so as the worsening crisis progressively deepened dependence on the IMF). Repeated rounds of austerity, protests, a corruption scandal, surging unemployment, a bank run and subsequent restrictions on withdrawals generated mounting turbulence and fragility, culminating in the December 2001 riots where 26 died and the government fell. This might be seen as the trigger event that tipped Argentina into a CC phase, from which a new trajectory would then emerge in 2003 with the victory of Nestor Kirchner in presidential elections (cf. Jepson, 2015, ch. 5). These trigger events are somewhat analogous to the contingent events at switch points that launch causal processes in many conceptions of path dependence. However, for authors using path-dependency frameworks, contingency in this context often indicates a belief that these events cannot be explained by reference to prior historical conditions (Goldstone, 1998; Mahoney, 2000). As Haydu (2010) points out, this limits the utility of path dependence in accounting for time spans of historical change longer than a single path-dependent sequence, since each switch point marks a sharp break between paths, with no apparent mechanism through which influence is transmitted from one to the next.8 In TA, however, a limited number of possible new trajectories emerge and are imminent within the conflictual processes of continual change that result in the transition of an ET phase into a CT one. Trigger events that tip CT phases into CCs are likely to be unpredictable, whether generated through the CT’s contradictory dynamics (e.g., rioting or political assassinations) or largely external of them (e.g., natural disasters). Resolution of the subsequent CC (or the crisis that might emerge from it) depends upon the establishment of a minimally stable new trajectory from the nascent alternatives generated during the previous CT. In these ways, TA recognizes the significance of both continuous and discontinuous change in driving political–economic transformation, but makes specific claims as to how these forms of change are causally related to one another and temporally sequenced. Transitions from ET to CT phases involve the working out and deepening of existing contradictions and the insertion of new ones into the mix, in a process of continuous change. It is for this reason that resolutions of CTs can, in principle, involve reversions to something close to (though never the same as9) pre-existing developmental trajectories. The transition from CTs to CCs, however, always involves particular events – breaks, or episodes of discontinuous change – that crystallize the contradictory dynamics of the CT and tip them over into periods characterized by CCs.10 To put this another way, while it is possible to devise a series of policy interventions that would allow a society to ‘step back’ from a CT, or at least prevent a CT morphing into a CC (as was the case, for instance, in Malaysia in the late 1990s, via the introduction of currency controls; Henderson, 2011, ch. 4), a reversion from a CC phase to the earlier CT phase is methodologically inconceivable. A transition from CC to a new and different CT, though, is distinctly possible. This could occur in conditions where the resolution to the CC establishes a trajectory which fails to stabilize and that from the outset operates under conditions of sufficient volatility to render it once again vulnerable to a further episode of discontinuous change. Applying TA to the post-colonial history of Zambia, for instance, shows that its economic and socio-political realities have been intimately associated with repeated transitions from ET to CT phases underpinned by recurrent contradictions and, in one instance, from a CT phase to CC, followed another period of CT (Jepson & Henderson, 2016).




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All the types of movement between phases of transformation sketched above involve a mixture of, and interactivity between, endogenous and exogenous dynamics (as seen from the perspective of the nation-state). Much of the political science literature on institutional change understands processes of gradual change in a similar manner, as a product of interaction between an ever-changing environment and institutions themselves subject to internal mutation (Blyth et al., 2011; Streeck & Thelen, 2005). Authors who focus on episodes of abrupt, discontinuous change, however, as occurs in our CT–CC movement, tend to see such breaks as purely (or mostly) exogenous in origin (Krasner, 1984), analogous to earlier debates in biology, where the classic example of such a phenomenon is the asteroid strike that brought the extinction of the dinosaurs 66 million years ago. By contrast, transformation analysis rules out the possibility that socio-economic change may ever be purely exogenous (or, for that matter, endogenous) in origin through a dialectical understanding of the relationship between the domestic and global. Constant dynamic interaction between a given national society and the global political economy means that while the latter functions largely beyond the domestic, it also forms a constitutive part of any national social order, in combination with local determinations. This is similar to conceptions of uneven and combined development where inter-societal interaction unevenly drives local development, which is in turn amalgamated in dialectical combination with existing elements into a single social formation (Dunford & Liu, 2017; Rosenberg, 2010). In the first instance, this means that the particular manifestation of any ‘external’ shocks at domestic level will depend greatly on dynamics thrown up through interaction with local conditions – as in the very different effects seen across regions and states during the 2008 financial crisis, for example. But this conception is still compatible with the notion of sharp breaks as exogenously generated, in the same way that an asteroid strike induces rapid environmental changes to which various forms of life will react in very different ways. The implications of TA conflict with exogenous shock models, however, in that the domestic and global are seen as partially constitutive of one another. All apparently external shocks and episodes of discontinuous change are, in the first instance, seen as dialectically generated through complex processes of global–local interaction, rather than via linear causality with a definite origin in a particular site (cf. Castells, 2000a). For example, while a global financial crisis may have its proximate origin in the United States, it will be partially constituted by socio-economic conditions across all domestic economies in the world (including those well outside the epicentre). Thus, even when considering the impact of such a crisis in a state that plays only a marginal role in the global economy, it is still the case that the dialectic between the global and this locality has some role to play (however minor) in constituting the crisis at world level; the crisis is thus never purely exogenous to any location. Other kinds of shock such as climate events may partly originate beyond the sphere of human social systems. Nevertheless, environmental geographers tend to take the view that there is no such thing as a natural disaster (Smith, 2006). A drought in California is experienced very differently from one of a similar extent in East Africa, with the occurrence of a disaster depending on social, economic and political conditions in the affected location, in turn dialectically related to global-level phenomena such as agricultural commodity markets (and, of course, to changes in the climate itself). For these reasons, while it is often useful to discuss particular events or sources of transformation as arising (in a proximal sense) through largely external or internal dynamics, as we do in the following discussion of Hungary and Malaysia, the ultimate source of all such phenomena lies in a dialectical combination of the two. Understanding the global and local as co-constitutive in this way allows for TA to be conducted at multiple, complementary scales. Below we discuss two cases using a state-centred angle of approach, though, in principle, the forms of dialectical relationship outlined above might equally be analysed from global or subnational perspectives, with a corresponding shift in notions of externality vis-à-vis the unit of analysis.


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TRANSFORMATION ANALYSIS ‘ON THE GROUND’


In this penultimate section we ‘ground’ TA by presenting a provisional application of it to the recent developmental histories of two political economies and societies: Hungary and Malaysia. Though at similar levels of economic development, but different levels of social development, they are useful for current purposes as they are both, arguably, in periods of CT. As such, they represent convenient cases through which to explore the utility of the analytical categories sketched above. We proceed by providing brief overviews of the current political and social condition of each country, before moving to applications of the transformation categories.

Hungary11 Recognized by the World Bank (2017a) and the UNDP (2017) respectively as an ‘upper middle income’ economy (gross domestic product (GDP) per capita US$12,665) with a ‘very high’ level of human development, since 2010 Hungary has been dominated by an increasingly authoritarian, ultra-conservative nationalist party, Fidesz (nominally in coalition with the Christian Democratic Party). In the 2014 elections, as in 2010, Fidesz gained two-thirds of the parliamentary seats (with around 45% of the vote). Since its victory in 2010, Fidesz-led governments have legislated to constrain significantly, representational, multi-party democracy, the rule of law and human rights (Tóth, 2012). A new constitution, which was subject to five substantial anti-democratic amendments in its first year alone, has been accompanied by serious limitations on the power of the constitutional court (especially in economic affairs and the activities of opposition parties). The politicization of the judiciary, civil service and the public media via the appointment of Fidesz supporters has proceeded apace. Constituency boundaries have been redrawn (almost halving parliamentary seats from 386 to 199), and the regulations on electoral alliances have been altered. The consequence is that it is now difficult for any party other than Fidesz and its supporters to win seats in the Hungarian parliament (Bánkuti, Halmai, & Scheppele, 2012). Furthermore, there are examples of laws being written in the interests of particular companies or, indeed, individuals (e.g., the changes in the tobacco licensing and banking laws in 2014), and politics seems essentially to have been reduced to the activities of a section of the political–economic elite whose object seems to be the privatization of the remaining public assets in their own interests, most notably with regard to leases on state-owned land (Fridrich, 2013). Corruption within the central state bureaucracy is widely regarded to be increasing and this may extend to the allocation EU funds (Fazekas, Chvalkovska, Skuhrovec, Tóth, & King, 2013). Through all of this, the EU has stood idly by, unable or uninterested in applying Article 7 of its constitution which is designed to discipline member states en-route to authoritarianism (Sedelmeier, 2014). During this period, the neoliberalization of economic governance, which began in the mid1990s (Phillips, Henderson, Andor, & Hulme, 2006), has continued to impact negatively the welfare state to the point that it has been all but eliminated. Unemployment benefit has been cut to the lowest level in the EU and the intention is to abolish it by 2018. Social benefits have been made discretionary and local governments now have the right to use subjective measures (e.g., ‘cleanliness’) to award or reject benefit claims, with particular consequences for the Roma minority (European Commission, 2016). The economy remains overwhelmingly low wage, with labour costs the fifth lowest in the EU (EUROSTAT, 2016). Against this background, one-third of Hungarian families are under threat of poverty or social exclusion (EUROSTAT, 2014) and at least 35% of them are too poor to buy sufficient food (Dugan & Wendt, 2014). Underlying Hungary’s authoritarian politics and social fragmentation is an increasingly foreign-owned and slow-growing economy that has been particularly badly hit by the ‘great recession’ and which, in value-generating terms, continues to perform largely lower-tier



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functions in the respective GPNs (Sass & Kalotay, 2012). While foreign investment in lowproductivity, low-value-adding activities has been true since the immediate post-socialist period, when firms from the EU (largely Germany), the United States and Japan acquired many of the former state-owned companies (Czaban & Henderson, 2003), more recently Russian stateowned companies have become increasing evident – particularly in energy investments (electricity and gas) – as the Fidesz regime has turned to the Russian government for support, and Chinese investment in banking, property (real estate) and manufacturing is growing (Nyíri & Xu, 2017; Szunomár, Völgyi, & Matura, 2014; The Moscow Times, 2014). Additionally, perhaps symbolizing new ‘eastern’ dependencies, the state-owned M1 television channel now broadcasts parts of its Hungarian news programmes entirely in Russian and Chinese, without subtitles (Jeffrey Henderson, personal observation, Budapest, 19 March 2017). Sources of transformation While contemporary Hungary seems to be clearly in a CT phase whose historical roots can ultimately be traced back to the centuries-old dynamics of uneven development there, as elsewhere in Central–Eastern Europe (Berend, 2003), the decisive period for understanding current circumstances is arguably the last 30 years or so since the period of ‘late Kadarism’ (Szalai, 1999)12 immediately preceding the rupture with state-socialism in 1989–90.

Evolutionary transformation. By the late 1960s, with the institution of the reform programme known as the ‘new economic mechanism’ (NEM) while still benefitting from the stable foreign trade and investment relations emanating from its membership of the Council for Mutual Economic Assistance (COMECON), the Hungarian political economy can be understood as having emerged into a period of ET following the CC and subsequent crisis that was the Soviet repression of the Hungarian ‘uprising’ in 1956. This ET period, however, was to be relatively short lived, as the economic contradictions associated with even Hungary’s ‘progressive’ form of state-socialism (rising foreign indebtedness, intervention by the IMF – which Hungary had joined in 1982 – the imposition of austerity budgets etc.) began to take hold of the political economy and society. By the mid-1980s, before the formal end of statesocialism, Hungary had arguably entered a phase of CT. Critical transformation I (early to late 1980s). Evident within this CT phase were arguably at least two possible trajectories to the future. One of which, as Czaban (2007) has cogently argued, could have involved a continuation of the economic and political liberalizations that had begun with the NEM in 1968, including changes within the Hungarian Socialist Workers’ Party, with the possibility of Hungary undergoing a gradual transformation into a version of a social democratic political economy. The other possibility would have been the implosion of the party resulting from its inability to manage the deepening contradictions afflicting Hungary’s political economy and society and, with it, the onset of a CC. In the event, it was the latter trajectory on which Hungary embarked, but one that, crucially, was triggered by an external contingency: the political and geopolitical shifts known collectively as the ‘collapse of the Berlin Wall’ (in 1989). Critical conjuncture I (1989–90). The CC that emerged in 1989–90 provided the opportunity for alternative development trajectories, both of which were advocated by external political actors. Intended as reconstruction strategies for all the former state-socialist societies, and not just Hungary, one, advocated by the French government operating through the EU, would have involved financial support for the various economies with encouragement for a gradual transition to a more marketized and capitalist future (Henderson, 1998, ch. 1). The other – which rapidly won out due to US, British, IMF and other pressure (and had strong AREA DEVELOPMENT AND POLICY

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support among key – by then, ideologically neoliberal – sections of the indigenous political– economic elites, including Hungary’s) – involved various versions of ‘shock therapy’ (Amsden, Kochanowicz, & Taylor, 1995). In the case of Hungary, however, the full force of the ‘shock’ was delayed for some years.

Critical transformation II (early 1990s–95). Subsequent to the CC occasioned by the collapse of Central–Eastern European state-socialism, Hungary entered another CT phase characterized by path dependencies (derived from state-socialism) at the level of the business corporations (Henderson, Whitley, Lengyel, & Czaban, 1995; Whitley, Henderson, Czaban, & Lengyel, 1996) articulated with a variety of neoliberal policy experiments which together produced a hybrid, but essentially unstable, political economy, which at its heart was a system of ‘recombinant property’ controlled by what was, initially, a non-capitalist, cultural elite that had emerged from the remnants of state-socialism (Eyal, Szelenyi, & Townsley, 2001; Stark, 1996; Stark & Bruszt, 1998). Though under the aegis of a conservative coalition government, led by the Hungarian Democratic Forum, the period 1990–95 can be seen as one characterized by halting, incoherent attempts to fashion some sort of social democratic political economy. During this period, welfare expenditures, for instance, were not significantly reduced and, indeed, in some cases, were increased. Whatever the possibilities of this trajectory emerging to underpin a ‘new normal’ in Hungary – a new phase of ET – they were cut short by severe economic recession. Critical conjuncture II (1995–early 2000s). In 1995 the new coalition government (elected in 1994) led by the Socialist Party instituted ‘shock therapy’ with a vengeance. With the policy programme known locally as the ‘Bokros package’, Hungary for the second time in six years was tipped into a CC (cf. Phillips et al., 2006). The resolution of this second CC arguably began under the first Fidesz-led government (1998–2002), was assisted by the promise of stability, higher living standards etc. expected from future EU membership, and by the time Hungary’s formal entry into the EU in 2004, had transmuted into a new period of ET. Critical transformation III (2008 onwards). The various transformation phases that have characterized Hungarian history from the early 1980s to around 2008 can be seen as the consequences of a series of partly different, but partly related, ‘solutions’ to recurring problems associated with the structural contradictions of the Hungarian political economy impacted as they have been changing geo-economic and geopolitical dynamics. Since then, and for the reasons indicated in the first section of this case study, Hungary is once again in a CT phase. This current phase, however, whose predominant origins seem to lie in the inadequate resolution of CC II (the relative stabilities brought by EU membership not withstanding), presages developmental trajectories that, if anything, may be more problematic than those that have gone before. This time, the reverberations of the CT are not only internal to the Hungarian society itself but also impacted by new, external dynamics – flows of migrants from the Middle East and South Asia, for instance – and xenophobic resistance to them – is beginning to spill out to impact adversely the EU more generally. Malaysia As another upper-middle income economy (GDP per capita US$9503), but with a lower level of human development than Hungary (UNDP, 2017; World Bank, 2017a), the results of Malaysia’s 2008 and 2013 federal elections highlighted the increasing political tensions that have now become apparent. In 2008, after 56 years of political domination, the Barisan Nasional (BN) – an alliance of three racially distinct parties, the United Malays National Organization (UMNO), the Malaysian Chinese Association (MCA) and the Malaysian Indian Congress (MIC) – for the first time lost its two-thirds majority in parliament. In 2013, its authority was AREA DEVELOPMENT AND POLICY



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further damaged when it came second in the popular vote (47% to 51%) to the opposition alliance, the multicultural Pakatan Rakyat (PR). However, due to the British-derived ‘first-pastthe-post’ electoral system coupled with direct and indirect vote buying (government policies and investment favouring particular localities), the gerrymandering of constituency boundaries and the manipulation of electoral rolls, the BN retained the largest number of seats: 133 to 89 (Weiss, 2009; Welsh, 2013). Support for PR seems to have come disproportionately from among the urban and young middle classes, who were disillusioned with Malaysia’s racialized, autocratic and corrupt political system (Chin, 2014; Weiss, 2009). With a population currently composed of about 68% Bumiputra (Malays and other ‘indigenous’ peoples), 25% Chinese and 7% Indian, Malaysia is the most multiracial of all Southeast Asian countries. Driven by foreign investment and with a semi-developmental state engaged in economic planning, it is also the only Muslim-majority country to have industrialized. In the process, it has achieved dramatic social progress on all the usual indices (health, housing, education etc.) including significant poverty reduction (though with 2.3% – about 600,000 people – still living on less than US$2 a day in 2009). Importantly, however, income inequality is the second highest in East Asia (after Hong Kong),13 and corruption within the ruling elites is extensive (Gomez & Jomo, 1999; Jomo & Wee, 2014).14 Additionally, Malaysia continues to be a low-wage society with persistently rising prices for housing, food and other commodities and an economy that is beginning to confront serious problems, in part related to its growing structural asymmetries (Henderson & Phillips, 2007; Jomo & Wee, 2014; Tan, 2014, Woodrow Wilson School, 2014). Sources of transformation While the current CT period in Malaysia can be dated from the mid-2000s and highlighted, symbolically, by the declining electoral support for the BN coalition indicated above, its political– economic origins probably lie in the changing configuration of external economic dynamics in the mid-to-late 1980s to which, at that time, Malaysia was particularly subject. Prior to that, and going back to the onset of decolonization in 1957, a compromise around ‘spheres of influence’ had implicitly been established, with Chinese Malaysians effectively controlling the economy and Malays the state (Jesudason, 1989). The asymmetric distributions of power, wealth and poverty that this implied meant that the post-colonial society and political economy was effectively born into a phase of CT.

Critical transformation I (1957–69). An early product of the contradictions that lay behind the post-colonial CT phase was the ejection in 1965 of Singapore (ethnically a largely Chinese enclave) from the Malaysian Federation that the former colonial power (Britain) had helped steer into existence in 1963. The contradictions of these asymmetries continued to coalesce and deepen, however, and transitioned into a CC triggered by race riots in 1969. Critical conjuncture (1969–early 1970s). Implicit within the CC of the late 1960s/early 1970s were a number of possible developmental trajectories, one of which was probably an authoritarian continuation with the economic status quo, with the preservation of the power of the post-colonial elites as they had been constituted both before and after 1957. Another was to drive economic growth and poverty reduction through industrialization. In the event, and undoubtedly learning from the experiences of Hong Kong, Taiwan and Singapore, it was the latter trajectory that began to crystallize. Relative to the others, however, the industrialization project was realized with Malaysian innovations in social development. Critical transformation II (early 1970s–mid-1980s). Fuelled by foreign investment from 1971 (particularly in electronics industries), Malaysia’s industrialization project was coupled with a poverty-eradication programme for all ethnic groups, and an affirmative action programme on behalf of the Bumiputra: the New Economic Policy (NEP).15 Though the NEP


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proved central to social stability and the creation of a Malay middle class, when it came to wealth acquisition, most of the ‘affirmative action’ turned out to be in favour of the Malay political elite and their business associates, particularly during the 22-year (1981–2003) premiership of Mahathir Mohamad (Gomez & Jomo, 1999).


Evolutionary transformation (mid 1980s–early 1990s). By the mid-1980s it is arguable that industrialization and its principal spatial product – urbanization – coupled with the NEP and its successor social development programmes had ushered in a relatively stable period of ET, the dramatic social and cultural changes associated with proletarianization (particularly among women) and a burgeoning middle class notwithstanding. Within this ET phase, however, the ‘groundwork’ for what became Malaysia’s third CT phase began to be laid. Critical transformation III (early to late 1990s). From the latter part of that ET phase it is possible to trace the beginnings of shifting architectures in GPNs – particularly of electronics industries – in ways that were likely to be detrimental to Malaysia’s economic growth and employment (Phillips & Henderson, 2009). Additionally, at around that time, it began to be clear that the NEP was having negative economic effects in the sense that it was deflecting entrepreneurship away from the formation of companies capable of linking productively with the subsidiaries of transnational corporations (Salih, 1988). By the mid-to-late 1990s, the consequence of this particular dialectic of exogenous flows and endogenous places was the sort of economic–political ‘lock-in’, with an absence of innovation coupled with slowing economic dynamism, that is sometimes known as the ‘middle income trap’. Critical transformation IV (late 1990s onwards). Unlike its Southeast Asian neighbours, Thailand and Indonesia, the regional economic ‘crisis’ of the late 1990s did not tip Malaysia’s political economy and society into a CC. The primary reason for this was that the government moved early to impose currency controls which limited the extent of portfolio disinvestment and thus the ravages that would otherwise have been wrought on the economy and on the majority of Malaysians (cf. Ali Abbas & Espinoza, 2006). Consequently, the political economy emerged from the financial turmoil relatively early (1999) and was not subject to significant shifts in, or contestation of, its development trajectory. In the absence of a CC, the dynamics evident during critical transformation IV intensified. While foreign-invested manufacturing has remained important, its significance in the economy has begun to decline. Partly associated with the government’s predilection to rentierism (rather than manufacturing entrepreneurship) as the key route to Bumiputra capital accumulation, for the past 15 years or so the economy has begun to be restructured around lowvalue service industries and – once again – real estate speculation (a key driver of the 1990s’ financial shock; Henderson, 2011, ch. 4). Worryingly from the point of view of building an innovation-driven, high-wage economy, by early 2014 manufacturing had fallen to 24% of GDP while services had risen to 55% (Malaysian Department of Statistics data), with researchers arguing that the country’s industrialization project was ‘stalling’ (Henderson & Phillips, 2007) and may even have begun to de-industrialize ‘prematurely’ (Rasiah, 2011; Tan, 2014). Certainly evidence of industrial upgrading in the economy is limited and, in its absence, China has emerged as a major competitive threat, both for inward investment and in terms of third markets (Nederveen Pieterse, 2015; Phillips & Henderson, 2009; Rasiah, 2011; Yusuf & Nabeshima, 2009). If current trends continue, Malaysia’s economic structure is likely to become dangerously asymmetrical. In the context of a corrupt, autocratic, racialized political economy experiencing the mobilization of a politically assertive civil society, this could be a recipe for political destabilization. Add to this the growing possibility of external, geopolitical contingencies associated with China’s militarization of the South China Sea – and the US AREA DEVELOPMENT AND POLICY


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response to it – in which the Malaysian government is implicated via its own maritime claims (Parameswaran, 2015), and there seems a distinct possibility that Malaysia’s current phase of CT could easily transition into a second CC.


CONCLUSIONS In this paper we have argued that most of the conceptualizations of development that we have today, and the discourses associated with them – be they derived from relatively orthodox or radical theorizations – are fundamentally constrained in their capacities to deliver analyses adequate to the realities of 21st-century global development. As a route out of this dilemma, we have advanced an understanding of development grounded on the concept of transformation. We have suggested that the key historical phases in the medium- to long-term development of given territorial spaces that especially need analytical (and, by implication, policypractical) attention are those characterized by CTs. It is within such periods that the contradictions that always underpin economic, social and political change are impacted by newly emergent ones, be they associated with pre-existing or new social forces. The velocity of change accelerates and the processes involved become more difficult for the agencies of social order to manage. Among other consequences, alternative developmental trajectories sometimes emerge and begin to be articulated by development actors. Where unanticipated contingencies become part of the unstable amalgam, CCs can ensue. These almost always presage a shift in the developmental trajectory. In an effort to show the utility of this approach for development analysis, the paper briefly reconceptualized the recent political–economic histories of two countries – Malaysia and Hungary – and pointed to possible trajectories for their development over the next few years. Whether our endeavours hold promise for theoretical innovation in the development sciences will depend on the analytical utility derived from more detailed applications of TA than we have been able to conduct here (on Zambia, see Jepson & Henderson, 2016) and on whether an ‘anticipatory approach’ to development methodologies can be forged as a guide to practical and policy intervention.

ACKNOWLEDGEMENTS The authors are grateful to the reviewers and editor for their extensive comments made on an earlier version of the paper. Additionally, as the paper formed the basis of lectures given by Jeffrey Henderson at the Universities of Maastricht, Bristol and California at Santa Barbara, he wishes to express his thanks for the comments made by participants at those lectures.

NOTES 1. By ‘development science’ we refer to those social science disciplines and their relevant subdisciplines – as well as the interdisciplinary project, development studies – that study economic, social, political and cultural development, as well as their causes and consequences. 2. In principle, ‘transformation analysis’ could be applied at world-regional and global levels also, but this exercise is not attempted here. 3. But see also Castells (2000a, 2000b, 2004) and the emerging work around ‘uneven and combined development’ (e.g., Dunford & Liu, 2017). 4. Though sticking closely to orthodox economic theory, Lin (2017) has indicated some of the ways in which developing countries can learn from China’s experiences. 5. The sense of ‘critical’ employed here is somewhat akin to that evident in Scheffer’s (2009) work on ‘critical transitions’ in ecological change. There, however, the term refers to the tipping point (an event or series of events) beyond which the turn to a new ecological order



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becomes inevitable. Our use of it refers more to CTs as processes that prefigure tipping points in their latter stages. 6. The notion of ‘developmental trajectory’ used here relates to ‘pathways’ to the future (economic, political, social, cultural) and thus to the possibility of different collective futures being imbricated in the same starting point. As such, it is a structural idea. Consequently, recessions or booms, for instance, do not necessarily imply changes in trajectory. 7. The classic example here being the persistence of the QWERTY keyboard layout into the personal computer era, a standard originally adopted for reasons of mechanical efficiency in 19th-century typewriters (David, 1985). 8. Haydu’s (1998, 2010) iterative problem-solving approach compares time periods in which social actors produce contrasting solutions to recurrent dilemmas under distinct conditions (see also Kaup, 2015, on Bolivia). TA is similarly concerned with the ways in which previous sequences and efforts to resolve contradictions influence later periods of contestation. Our own work on Zambia has found enduring contradictions that have periodically recurred in new ways and under novel circumstances since the 1960s (Jepson & Henderson, 2016). However, as an approach, TA does not focus on a specific set of actors and in comparison with Haydu’s schema makes more precise claims around sequencing and periodization of change. 9. At the beginning of The Eighteenth Brumaire of Louis Napoleon (1852), Karl Marx famously comments on history repeating itself: ‘the first time as high tragedy, the second time as low farce’ (Carver, 1996, p. 31). While that may appear to be possible in historyunderstood-as-events (the way, in fact, that Marx employs his comment), in history-understood-as-process, it clearly is not. 10. There are similarities here with Sewell’s (2008) work on the ‘temporalities of capitalism’. 11. We are grateful to Laszlo Czaban (University of Manchester) for sharing his reading of the Hungarian and English scholarly and media literatures with us, as well as for his views on the current state of Hungary’s political economy and politics. The interpretation developed here, however, is entirely our own. 12. ‘Kadarism’ refers to the partially liberalized, partly marketized, form of state-socialism that developed in Hungary during the political administration of Janos Kadar (General Secretary of the Hungarian Socialist Workers’ Party, 1956–88). 13. The Gini coefficient for Malaysia in 2009 was 0.46 (World Bank, 2017b) and for Hong Kong (in 2016) was 0.54 (Hong Kong SAR, 2017). 14. A recent – and internationally publicized – manifestation of which has been the disappearance of nearly US$700 million from the sovereign wealth fund, 1Malaysia Development Bhd., and the appearance of a very similar amount in the personal bank account of Prime Minister Najib Razak (Wall Street Journal, 2015). 15. The NEP may have been the only example in any capitalist political economy of a redistribution programme being consciously developed as a central element of an industrialization project.

DISCLOSURE STATEMENT No potential conflict of interest was reported by the authors.

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Critical transformations and global development

Critical transformations and global development

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