Facing economic imbalances

Facing economic imbalances, unable and unwilling to change policy, many governments sustained ISI by borrowing from abroad. Yet foreign loans could provide only a temporary solution; foreign lenders would eventually question whether loans could be repaid. When they concluded that they couldn’t, they would be unwilling to lend more, and governments would be forced to… Continue reading Facing economic imbalances

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Stable macroeconomic environment

This stable macroeconomic environment had beneficial consequences for Asian economic performance. Low inflation promoted high savings rates and investment (World Bank 1993, 12). Savings rates in the Asian NICs averaged more than 20 percent of GDP per year, almost twice the level attained in other developing countries, whereas investment rates were 7 percentage points of… Continue reading Stable macroeconomic environment

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The three stages of industrialization

These three stages of industrialization are evident in the paths traced by Taiwan and South Korea. (See Table 7.3.) In Taiwan, industrialization fo- cused initially on light manufacturing, textiles in particular. By the mid-1950s, textiles were Taiwan’s most important export. The government also encour- aged production of simple consumer durable goods such as television sets.… Continue reading The three stages of industrialization

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Structural Adjustment and the Politics of Reform

Structural Adjustment and the Politics of Reform 145 STRUCTURAL ADJUSTMENT AND THE POLITICS OF REFORM By the early 1980s, governments in many developing countries were recog- nizing the need for reform. The imbalances generated by ISI created pressure for reform, and East Asia’s success provided an attractive alternative model. It took a massive economic crisis,… Continue reading Structural Adjustment and the Politics of Reform

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The IMF and the World Bank

The IMF and the World Bank also encouraged privatization of state- owned enterprises—that is, selling such enterprises to private individuals and groups. The IMF and the World Bank argued that reducing government in- volvement in the economy would foster competition and that greater com- petition would in turn help create a more efficient private sector… Continue reading The IMF and the World Bank

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Adopting Trade and Domestic Policy Reforms

Countries Adopting Trade and Domestic Policy Reforms, 1980–1996 Africa Latin America Benin Malawi Argentina Honduras Burkina Faso Mali Bahamas Mexico Burundi Mauritania Barbados Nicaragua Cameroon Mauritius Belize Panama Central African Republic Mozambique Bolivia Paraguay Chad Niger Brazil Peru Congo Nigeria Chile Suriname Cote d’Ivoire Rwanda Colombia Trinidad Ethiopia Senegal Costa Rica Uruguay Gabon Sierra Leone… Continue reading Adopting Trade and Domestic Policy Reforms

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Comparing average growth rates

Structural Adjustment and the Politics of Reform 149 with structural adjustment. In some instances, efforts to implement economic reform were overtaken and greatly complicated by civil and international conflict. Even so, average growth rates have been higher since 1990 than the average rate during the 1980s. Moreover, the last few years have been particu- larly… Continue reading Comparing average growth rates

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Reform and Growth in Latin America

Reform and Growth in Latin America Source : Reform index from 1997, 96; growth rates from World Bank, World Development Indicators     150 CHAPTER 7 Trade and Development II: Economic Reform most should see large improvements in growth, whereas countries that have reformed less should see small growth gains. That expectation finds some sup-… Continue reading Reform and Growth in Latin America

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