Andrew Rosser

This Element argues that Southeast Asia's failure to develop stronger social protection systems has been, at its root, a matter of politics and power. It has reflected the political dominance within the region of predatory and technocratic elements, and the relative weakness of progressive elements. From the mid-1980s, democratisation, the emergence of political entrepreneurs seeking to mobilise mass electoral support, and the occurrence of severe economic and social crises generated pressure on governments within the region to strengthen their social protection systems. But while such developments shifted policy in a more progressive direction, they have been insufficient to produce far-reaching change. Rather, they have produced a layering effect. Innovations have built upon pre-existing policy and institutional arrangements without fundamentally altering these arrangements, ensuring that social protection systems continue to have strong conservative, productivist and predatory attributes.

This book examines the dynamics shaping the economic process of economic liberalisation in Indonesia since the mid-1980's. Much writing on the process of economic liberalisation in developing countries views economic liberalisation as the victory of economic rationality over political and social interests. In contrast, this book argues that economic liberalisation should not be understood in these terms, but rather in the way that political social interests shape processes of economic reform in both a positive and negative sense. Specifically, Rosser argues that economic liberalisation needs to be understood in terms of the extent to which economic crises shift the balance of power and influence within society away from coalitions opposed to reform and towards those in favour of reform. In the Indonesian context, the main coalitions that need to be examined in this respect are the politico-bureaucrats and the conglomerates who have generally opposed reform and mobile capitalists who have generally supported reform. Based on extensive original research, and providing much new material, the book considers the politics of economic policy-making in Indonesia in a range of sectors including the capital market, intellectual property law, the banking industry, and the trade and investment sectors. Analysing why the nature of economic policy in Indonesia has varied over time, this study argues that there is nothing inevitable about a transition to a fully-fledged liberal market order in Indonesia, and outlines possible future scenarios for the country's political economy.