Cultural identity in policy transfer : Malaysia Look-East policy case study

Urwah Saari

International Development Analyst


Over the years, public policy has become the fundamental principle of administration in a nation state, a guideline and framework used by a government to run the country; and often became fundamental for development approach. While there are many forms of policy-making, the concept of ‘policy transfer’ has become an increasingly popular way to understand public policy. Most developing countries are looking at the developed nations as precedence, in tackling their home issues.

This essay reviews the opportunities and limitations of policy transfer through time between the developed and the developing countries. Based on the literature, the first part of the essay deconstructs the keywords in the policy transfer and elaborate key literature on the keywords. The second part discusses the reasons behind ‘policy transfer’ preference in comparison to others. The determinants of success and failure of policy transfer are discussed in the third section. The two final sections of the essay critically review the opportunities and the limitation of the implementation of policy transfer, supported by case studies from the European Union (EU) and the Organization for Economic Co-operation and Development (OECD) transfer policy between the donors and the recipients; as well as the case study of Malaysia’s ‘Look East Policy’.

What could be called a policy transfer?

Deconstructing the phrase ‘policy transfer’ would help to set a strong basis in understanding the matter. Among the earliest scholars such as Heclo (1972) and Easton (1953) connect ‘policy’ as a course of actions and decisions that allocate values, whilst Jenkins (1978) describes policy as a set of interrelated decision ‘concerning the selection of goals and the means of achieving them within a specified situation’. Hence, a policy is recognized as ‘public’ when it involves a set of actions and decisions made by the government. Cairney (2012) defines it as ‘the sum total of government’s actions, from signals of intent to the final outcomes’. A government action consists of political decisions for implementing programs to achieve societal goals.

Having understood that, policy transfer is “the process by which knowledge about policies, administrative arrangements, institutions and ideas in one political system (past or present) is used in the development of policies, administrative arrangements, institutions and ideas of another political system” (Dolowitz and Marsh, 2000). It is a generic, umbrella term that encompasses the many different conceptions of the process by which ideas, institutions, or programs from one time or place are used in another. It comes in the forms of lesson-drawing (Rose, 1991), policy bandwagon (Ikenberry,1990), policy emulation (Howlett, 2000), convergence (Bennett, 1991) and policy diffusion (Majone, 1991). The processes of ‘policy transfer’ include ‘voluntary’ adoption which Evans (2009) alleges attempting to ‘subsume Rose’s ‘lesson drawing’ and ‘coercive transfer’, ‘where a government or supranational institution encourages or even forces a government to adopt a policy’ (Dolowitz and Marsh, 1996). The objects of transfer include policy goals, policy instruments or administrative techniques, structure and content, institutions, ideology, ideas, attitudes and negative lessons (Dolowitz and Marsh, 1996). Although these terms and processes can be very closely related, they can also stand relatively independently. For example, a government may decide not to adopt a policy after learning from the experience of another or may emulate the policy without studying its extent of successfulness in the exporting country.

Why policy transfer?

Policy transfer happens when a government faces a problem, the search for a solution may include investigation of the experience of others. It is not ordinary to think that every country has a unique problem because when confronted with a common problem, which caused by the same behavior of human nature, only contrasted by the diversity of cultural and geographical context. Rose emphasizes that problems that are perceived as unique in a country are ‘abnormal’ and policy makers regardless of any hierarchy and nation can learn from how their counterparts elsewhere respond (Rose, 1991). Driven by the perception that abroad solution specifically the Western solutions are the best, developing countries are increasingly likely to look for solutions from abroad (Dolowitz and Marsh, 2000). Generally, there are various forms of policy transfer identified, including voluntary policy transfer, involuntary of coercive policy transfer, direct and indirect policy transfer, and obligated/negotiated policy transfer (Dolomitz and Marsh, 1996).  Dolowitz and Marsh’s continuum idea is that forms of transfers are more voluntary and learning from another country without much pressure. The opposite side is coercion transfer, which often placed in conditionality, for example, the countries who are so desperate or told that they are desperate to borrow money from the International Monetary Fund (IMF) will need to accept the IMF’s condition which normally weakening the role of the state in their own financial dependency. Obligated transfer in another hand has discreet similarity to indirect coercion, for example, member states sign up to a political and economic institution such as European Union (EU) need to follow the lead of the other dominant member state in the isomorphic processes such as Germany and France. In most cases, small member countries simply need to respond to the ‘externalities’ or ‘spillovers’ of the policies of larger countries which share a border with them (Radaelli, 2000).

The reasons behind the upsurge of ‘policy transfer’ in the policy transfer study are identified. The “rapid growth in the communication of all types since the Second World War has accelerated the process [of policy transfer]”  has increased ‘policy transfer’ occurrence (Dolowitz and Marsh, 1996). The processes of globalization towards the 21st century have created new opportunity structure for policy transfer. Policy transfer becomes more influential with the close relationship between the Blair and Clinton administrations in the UK and the USA.


The spotlight of the transfer which was labelled as the ‘Americanization’ of British welfare system in 1997, proved to be the biggest adaptation attempt of American policy in British public at the time (Walker,1999).

Furthermore, the Western interpretation of ‘Good Governance’ has influenced many developing countries to respond to the wish list of the globalized standard of governing a state. For some developing countries, good governance implementation is often seen as a reinstatement of the Western normative values such as rights, democracy, and poverty reduction.


What are the determinants of a success or a failure of a ‘policy transfer’?

For an importing policy to be successful, the ‘borrowing’ government should study the policy and political system of the ‘transferring’ government adequately to know the success factor and whether that success is transferable. The objectives of transfer must be consistent and non-ambiguous and the unintended consequences must diligently consider during policy design. A stable and certain socio-economic and political condition of the ‘borrowing’ country must undermine the lack of support from the affected groups (Dolowitz and Marsh, 2000). The success or failure is dependent on the implementation of the policy in particularly in the instance where the transfer involves obligatory acts towards an international governmental organization (IGO). For example, in the EU, where the organization itself puts pressure on the recalcitrant member states, or the OECD countries enforce western definition of ‘good governance’ standard for rogue/fragile recipient countries to comply (Leslie, 2014).

The failure of ‘policy transfer’ are contributed by various factors. Policy transfer with the uninformed, incomplete and inappropriate transfer are potential to fail as Dolowitz and Marsh analyse that there are three contributing factors to this failure. First, an uninformed transfer is “caused by the poor problem definition and insufficient information” about the policy in the origin country and how it operates. In the case of ‘incomplete transfer’, the important element of success policy in the originating country may not have been transferred, or partially transferred which leading to failure. Inappropriate transfer often caused by insufficient consideration regarding uncertain socio-economic and political context that underlies differences between the ‘transferring’ and the ‘borrowing’ country (Dolowitz and Marsh, 2000).


Though literature has shown that policy transfer is generally unfavourable, a number of arguments can challenge that. There are constructive opportunities that appear to benefit the origin and destination countries. Policy transfer demonstrates the importance of adopting a more global understanding to the practice. It would be difficult to understand policy development in central and east Europe and Indochina post-communism without understanding the global role of the World Bank, the EU, and the OECD among others (Leslie, 2014). The impact of global approach can now be seen as a majority of the countries in the world have central banks and have worked collaboratively with the World Bank to introduce financial reforms ‘to make them legally independent’ since the 1990s (Marcussen, 2005). Another example is the international standard for quality and management, ISO 9000 which takes cue from the development of the public sector in several OECD countries has become a standard in most countries. Developing countries responded remarkably positive with this standard in order to transcendent limit in the economic relationship with the developed countries (Siddique, 2010). Interesting fact to note that Malaysia, a developing country in the Southeast Asia became the first country in the world to try and implement ISO on its all government agencies, however eventually ended with national customized standard in Malaysian Standard (MS) ISO 9000, developed by the Standards and Industrial Research Institute of Malaysia (Common,1999).

Policy transfer holds an opportunity to produce actions in response to the positive change between neighbouring countries. The rapid development of Japan after the World War 2 motivates the Indochina and South East Asian countries such as Malaysia, Singapore, and the Philippines to emulate and follow, which Ikenberry (1990) articulates it as the band-wagoning of Japan remarkable achievement. The Look East policy, introduced by the then prime minister of Malaysia in 1981 Mahathir Mohamed, encouraged a turnaround from the “traditional perspective of Western countries as role models and instead look towards the East” (Siddique, 2010). The policy transfers the technology, emulates high productivity, strong ethical standards as well as management philosophy and practices from the East especially in Japan and South Korea (Siddique, 2010). The Look East policy has produced a direct outcome with the introduction of ‘Malaysia Incorporated’ policy in 1983, a policy which was inspired and emulated based on the notion of the ‘Japan Incorporated’, a relationship model between Japan state and private sector to boost the country’s economy (Jomo, 2014).  The essence of this approach is to increase the cooperation and collaboration between government and private sector to accelerate economic development.

Malaysia’s first national automotive project, Perusahaan Otomobil Nasional or Proton is one of the initiatives from Look-East policy. collaboration between the government-private sector. Proton which was established in 1983, owned by the government through Khazanah Nasional and had its first collaborations and partnerships with Mitsubishi Motors.

Malaysia’s first national car, Proton Saga was launched in 1985

Policy transfer also emphasizes the plurality of actors that can involve in the policy making process. In the case of ‘Malaysia Incorporated’, the thorough implementation across all level of federal and state requires all public sector agencies to hold consultative panels with private sector partners to formulate on the policy implementation. Corporatization or privatization, as part of the whole ‘Malaysia Incorporated’ agenda, become fertile ground for more actors to be trained in the policy making process. For instance, the special task force to initiate public-private partnership (PPP) has been turned into a specialist government unit under the Economic Planning Unit (EPU) in the Prime Minister’s Department (Siddique, 2010).


Amid all the opportunities, some critics argue that the credibility of the concept is being stretched a little too far and the methodological problems in proving whether or not the transfer is relevant to have occurred. In the case of ‘Malaysia Incorporated’ policy, the distinctive element between Malaysia and Japan successfulness in corporatization and privatization is the homogeneity of societal and cultural in both countries. Japan is occupied by predominantly single ethnicity whilst Malaysia is a diverse country with multiple ethnicities, religions and political beliefs, therefore that makes the result of the implementations are different even though the similar models were constructed (William, 2010).


Take one example. In international football, Malaysia and Japan used to play at the same level in the 70s. However, Malaysia has failed to emulate the great success of Japanese football development. Could cultural identity be a big limitation?

Clifton and Diaz-Fuentes have a more pessimistic evaluation of the OECD’s methodological approach in its ‘Enhancement Engagement’ with five of G-20 countries; Brazil, China, India, Indonesia, and South Africa. Clifton and Diaz argue in their finding that it was relatively successful with South Africa and Brazil, however, did not materialise with China because OECD is still a ‘Western’  organization in its “approaches, models and even its personnel” (Clifton and Diaz-Fuentes, 2014). Policy transfer is shaped by “cognitive and recognition phases including language and culture as inter-personal experiences” (Clifton and Diaz-Fuentes, 2014). As policy decision making is partially contributed by bounded rationality, an idea by Herbert Simon in 1957; in which the rationality of human is limited by the cognitive limitation of information they have and the finite amount of time to make a decision. This could explain the reason behind unequal result of OECD policy transfer in English spoken language in South Africa and India as compared to China and Indonesia. English is an official language in South Africa and India within average around 10 percent of the population speaks English while there are estimated less than 1 percent of Indonesia and Chinese speaks English (Leslie, 2014).

We can collectively argue that particularly in the developing country, particularly in Asia as pictured in Malaysia implies that cultural identity is a major factor in policy transfer success, unbeknown to the international agencies which promote policy transfer as a global solution.


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