Abstract
Instead of adopting approaches emphasizing cost and trust, this paper examines the history of Taiwan's footwear industry from a political perspective, and analyzes how the formation of the industrial governance structure helped Taiwan to become a global leader in shoe exports. Particular1y, the Taiwanese Footwear Manufacture's Association (TFMA) played an important role in stabilizing the production market during both the cut-throat competition in the late 1960s and the international trade protectionism in the 1970s. The “price approval for licensed export" and the “order1y marketing agreement" implemented by TFMA not only regulated the interaction between enterprises, but also distinguished the incumbents from the challengers in the footwear industry. Furthermore, the emergence of the status hierarchy led to the successful relocation of Taiwan footwear industry to China. Finally, the industrial association highlighted in the paper not only supplements Fligstein's model of markets as politics, but also elaborates the perspective of the developmental state.