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This thesis in the result of more than two and a half years study in Malaysia between 1969 and the end of 1973, although most of., tho work that in most directly concerned with the thesis title was carried out in Malaysia in the first half of 1973. The research was supported by a grant from the Social Science Research Council and this grant onabled me to work flail-tino on the project between January 1973 and the end of February 1974. '" This thesis is prst of the final report to the SSRC and copies also havo been sent to the following organisations in Malaysia: The Economic Planning Unit, Kuala Lumpur; Tho Ministry of Trade and Industry, Kuala Lunpur; The University of Malaya (Faculty of Economics and Administration), Kuala Lumpur; Bank Negara (Central Bank), Kuala Lumpur; Tho Treasury, Kuala Lumpur. Innuraerablo people in the above organisations and elsewhere have assisted in tho research; but my special thanks go to V. T. Subromaniaa and B. Rajcoonar (who both worked as research assistants)-, to Zainal Aznw and Pathraanabbn in the EPU; to Malok Marican and many others in the Treasury; to, David Li©, and others in the University of Malaya; to Musa Hitan (Deputy Minister in the Ministry of Trade and Industry); to Professor Mackintosh, my supervisor in the School of Development Studios of the University of East Anglia; to Charles Flli. ott and John, Thoburn (also at UEA); to Professor Max Cordon and K. P. Teh at Oxford; and, above all, to Liz, my wife, who prevented ae from thinking that the research would change the world. The thocis is split into sovon chapters. The first two chapters give an'economic and political history of Malaysia and describe why and how tho incentives to industrialisation were introduced. These give tiro background to and describe the emphasis given to industrialisation in Malaysia. The next three chapters (Chapters, 39 4 and 5) attempt to trace the effects of the incentives used to promote industrialisation in Malaysia. In Chapter 3 particular emphasis is given to the incontives offered in the form of tariffs, quotas and other forms of protection, the reasons for the protection, and the relationship between the level of protection, profits and the market structure in '. ho various industries. The effects of the incentives (again particularly protection) on income distribution through prices, employment and the level of wages is considered in Chapter 4. Chapter 5 attempts to consider the social costs and benefits of protection more generally, and to look at the impact of foreign investment in the manufacturing sector. Chapter 6 of the thesis looks at the development and prospects of the primary products sector and, finally, Chapter 7 gives a su ary of the main points in Chapters 2 through to 6 and drawn some conclusions from the research. There aro a number of appendices, mostly consisting of the details of the case studies of the industries. The main results of those case studies are contained in Chapters 3 and 5 but they are likely to be particularly useful to those people who have an interest in a specific, industry or to those who want to do further research along those lines, or to make corrections to mine. They are therefore included. Those readers who would like to obtain quickly an impression of the coin findings of the research are advised to road Chapter 7 before the other chapters. But before the nitty-gritty of the report, a few remarks should be made about terns and titles used, Firstly, there may be some confusion about the torus Malaysia, Malay, and Malaya, and about the use of the word Tracoº in the context of Malaysia. Malaysia is used to refor. to the Federation of Peninsular Malaysia (which itself was referred toi until recently, as West Malaysia, but which is now officially referred to as Peninsular Malaysia) and East Malaysia (consisting of the states of Sabah and Sarawak). Peninsular Malaysia is the same geographic area as the Federation of Malaya which oxieted between 1948"and 1963, and consists of the eleven States of Johor, Kedah, Kelantan, Malacca, Negri Soubilan, Pahang, Ponang/Provinco Wellesley (referred to from hereon simply as Penang State), Perak, Perlin, Selangor and Trengganu. The maps on pages ev) and(v) should help to clarify the meaning of these torus, as should Chapter 1. The meaning of the terms Malay and race are more diffiQult to specify precisely. By constitutional and legal definition, Malays are and must be Muslims; they are the traditional subjocts. of the, Sultan and the people whose native language is Malay (p. 13, Means, 1970). For the Malays; to abandon Islam means the loss of all legal and political privileges afforded to them on the basis of their claim of being the 'indigenous' people (p. 17, Means, 1970). Because of this claim, Malays commonly refer to themselves as the Buniputera or 1sons of the soils. In Most official publications of the Government of Malaysia, ., Malaysians of Indian, Chinese and Malay origin are referred to as traces and this practice is followed in this thesis, although tethnic groups' would be a lose inaccurate reference.In this report Malaysians are gonorally roforrod to by dropping the torm Encik or Mr., though 'higher' titles are included to conform with cooion usage in Malaysia. tDatot is a non-horeditary title conferred by a state or by the Head of State and, since 1966, the federal title, Dato, has boon changed to 'Tan Sri' to distinguish it fron the title conferred by the state. 'Tun' is a, title which ranks higher than Dato and is conferred by the Head of State. The spoiling of Malay words and place names as far as possible conforms with the official spoiling as at the dato of writing (September 1974). The most cormon spelling of personal names is usod. Official statistics in Malaysia define manufacturing in accordance with the Standard Industrial Classification adopted by the United Nations in 1958- The torts 'industry' is used hero to refer to the 4-digit Malaysian Industrial Classification (itIC). The whole of manufacturing is referred to ras tho Ix ufacturing sector', and tho 2-digit cla. sification is referred to as a sub-sector. For oxaapl©, , 40 is the Manufacture of Rubber Products sub-sector, and classification 4021 refers to the industry manufacturing tyros and tubes. Other torus are defined as they are usod unless there is thought little likelihood of any misunderstanding. Again to conforci with official usage, the Malaysian currency is referred to as the ringgit, but is abbreviated to ,. If US dollars are referred to they are abbreviated to US , %. In the tables pillions of units are denoted as in. All references are given briefly in the text by author and year and are given in detail in alphabetical order at the end of Chapter 7.

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