Role of Law and Legal Institutions in Cambodia Economic Development: Opportunities to Skip the Learning Curve

  • Siphana Sok

Student thesis: Doctoral Thesis


This thesis advances the view that, in an era of regionalization and globalization, Cambodia, as a least developed country, can deliver sustained economic growth, social stability and development if it can develop a coherent set of economic policies linked to the development of a functional and credible legal system. The scope for ‘catch up’ or ‘skip the learning curve’ is possible provided Cambodia can draw from the experiences - policies, legal system and institutions that have been discovered, tried, tested and refined - of other countries with similar background and with proven track records of rapid economic growth. In the context of Asian economic growth and development over the past 30 years, policy choices have been shown to be crucial for achieving high growth rates. Experience of the high performing economies in Asia over the past decades is the best evidence that those with relatively low income levels are, with the right policy and institutional choices, able to catch up with the richer ones.

The Cambodian experience, tested against four hypotheses (convergence, divergence, differentiation and irrelevance hypotheses), demonstrates a series of complex causal links and effects intertwined between law, economics, politics, history and culture. Arguably, the thesis seeks first to understand, through a multi-dimentional lens, la problématique of Cambodia’s long term economic development, and second to provide a long term coherent systemic solutions to the wider issues of nation building.

Certain Cambodia experiences have shown substantive convergence with those of the West or other advanced Asian countries as reflected by the steady economic growth over the past decade. Along that line the degree of catch-up is not only feasible but far exceeds those of other similar countries. Other positive signs of development are prevalent throughout the country. Other Cambodian experiences confirm the economic divergence hypothesis which suggests that Cambodia’s catch-up efforts may be possible, though not necessarily along international best practices, but under the influence of other major different factors typically identified as culture, tradition, history and geo-politics. The overall economic expansion in the last decade has not brought the so-called “quality of growth” where development has had a positive impact on factors such as poverty and inequality, the role of the state, democracy and freedom. The argument in favor of the economic differentiation hypothesis suggests that while there are strong signs of policy catch-up in the area of
integration and trade related areas, Cambodia’s institutional structures have not fully converged. Culture is another facet confirming this hypothesis.

On the legal side, the Cambodian experience has shown that some legal convergence did occur with the process extensively influenced by Western and successful Asian experiences. The policy shift in the mid 1990s has promoted the process of legal convergence and the legal system had evolved slowly towards being much more rule-based. Other Cambodian legal experiences support the legal differentiation hypothesis which suggests that different parts of the legal system behave differently, with some parts showing signs of convergence and others developing along a more idiosyncratic path. While there are strong signs of catch-up in the area of legislative development, Cambodia’s institutional structures and their enforcement mechanisms either have not converged, or worse have persistently resisted change. The trend towards a more market-allocative legal system has not resulted generally in a strengthening of the rule of law.

In sum, the Cambodian experience, while balancing to some extent the convergence and divergence hypotheses, validates the strength and dominance of the differentiation hypothesis. The dominance of the differentiation factors explains why Cambodia, while having the necessary ingredients and possibilities to skip the learning curve or leap frog, did experience only a minimum and uneven quantum of the leap frogging process. Nonetheless, taking into account the ‘Ground Zero’ starting point, the fragile peace and the multiple-fold transition that Cambodia went through since the late 1980s, there is a merit in supporting the argument that Cambodia, as still a post-conflict society and political system, has decently done well, and that the leap frogging process, though minimal, can serve as a foundation pillar for skipping the learning curve in the future. Moving into the future, there is a strong likelihood, if not certainty, of the Cambodian experience inexorably pursuing its path-dependent trajectory well into the next generation affirming in the process the continued validity of the differentiation hypothesis. The combined ‘push and pull’ effect, generated from the constant changes of both external and internal factors, will invariably shape and give credence and authority to the differentiation hypothesis confirming the trends and expectations that indeed Cambodia will continue to leap frog, not at a fast pace had the convergence hypothesis be validated, but with a minimalist quantum.
Date of Award14 Feb 2009
Original languageEnglish
SupervisorMary Hiscock (Supervisor)

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