After long suffering from benign neglect if not outright contempt, industrial policy is almost fashionable again. The global financial and economic crisis known as the Great Recession has forced researchers and policy makers to confront the reality that market forces alone generally do not lead to (constrained) Pareto-efficient outcomes.
... Exibir mais + Many important national and global policy objectives (equality of opportunity for all citizens, financial stability and inclusion, environmental protection and pollution control, etc.) are simply often not reflected in market prices and not achieved by markets on their own. In addition to traditional justification for industrial policies -- dealing with externalities and coordination issueseconomists and policy makers now acknowledge the need to foster learning at the level of each economic agent and throughout society and the ultimate responsibility that the state must bear in that crucial process. But converting the now widely accepted theoretical principles of industrial policy into practical frameworks for concrete government action is indeed a daunting task everywhere and perhaps more so in the African context where the institutional underpinnings of effective government are often not as strong as one might have hoped. This essay highlights the intellectual foundations and broad principles of good industrial policy, outlines the contours of the policy agenda, and fleshes out the lessons learned. It argues that there has been substantial progress on the understanding and acceptance of industrial policy and that Africa could benefit enormously from it and from the unprecedented new opportunities brought to light by a multipolar world.
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Documento de trabalho sobre pesquisa de políticas WPS6633 OCT 01, 2013
This paper assesses some of the main strands of the theoretical literature on unemployment and employment and shows that their interesting conclusions may not be transferable to low-income countries whose endowment and production structures are profoundly different from that of high-income economies.
... Exibir mais + It then tackles the knowledge deficit on employment creation by shedding light on the new economic opportunities that latecomers may derive from the dynamics of globalization -- especially the economic success of large emerging economies such as China and Brazil. It offers a simple analytical framework for identifying opportunities for labor arbitrage in the global economy and suggests a practical policy framework for exploiting them.
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Documento de trabalho sobre pesquisa de políticas WPS6661 OCT 01, 2013
This essay is about an important area in which there has been major rethinking -- industrial policy, by which the authors mean government policies directed at affecting the economic structure of the economy.
... Exibir mais + The standard argument was that markets were efficient, so there was no need for government to intervene either in the allocation of resources across sectors or in the choices of technique. And even if markets were not efficient, governments were not likely to improve matters. But the 2008-2009 global financial crisis showed that markets were not necessarily efficient and, indeed, there was a broad consensus that without strong government intervention -- which included providing lifelines to certain firms and certain industries -- the market economies of the United States and Europe may have collapsed. Today, the relevance and pertinence of industrial policies are acknowledged by mainstream economists and political leaders from all sides of the ideological spectrum. But what exactly is industrial policy? Why has it raised so much controversy and confusion? What is the compelling new rationale that seems to bring mainstream economists to acknowledge the crucial importance of industrial policy and revisit some of the fundamental assumptions of economic theory and economic development? How can industrial policy be designed to avoid the pitfalls of some of the seeming past failures and to emulate some of the past successes? What are the contours of the emerging consensus and remaining issues and open questions? The paper addresses these questions.
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Documento de trabalho sobre pesquisa de políticas WPS6628 SEP 01, 2013
Stiglitz, Joseph E.; Yifu, Justin; Monga, CelestinDisclosed
The chapters in part one provides the overall context of light manufacturing in Tanzania. Chapter one presents the rationale for the study, the potential of the sector in creating jobs and prosperity for Africa, and the approach and methodology of the study.
... Exibir mais + Chapter two reviews Tanzania's recent economic performance and prospects and concludes that, despite good macroeconomic performance, the country still needs to pursue structural transformation and diversification. Moreover, despite Tanzania's abundant natural endowments, manufacturing remains a viable source for job creation and prosperity. Chapter three examines the overall business environment among firms of all sizes in light industry in Tanzania. It first reviews the macroeconomic framework, focusing on wages, exchange rates, and interest rates before analyzing the microeconomic issues affecting firms such as export incentives, trade logistics, and access to electricity, land, and finance. Competition, an issue of paramount importance in improving Tanzania's competitiveness, is analyzed next, before a discussion of a potential shortcut for addressing some of the related macro and micro problems.
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There is a wide consensus in academic and policy circles on the idea that good governance is a prerequisite to sustained growth and economic development.
... Exibir mais + Good governance generally 'relates to political and institutional processes and outcomes that are deemed necessary to achieve the goals of development the process whereby public institutions conduct public affairs, manage public resources and guarantee the realization of human rights in a manner essentially free of abuse and corruption, and with due regard for the rule of law.' The dominant view of good governance as a pre-condition for economic success is therefore misguided. This paper acknowledges that governance problems are indeed major impediments to economic growth. But contrary to conventional wisdom, it argues that they are often correlated with the level of economic development. Seen from that perspective, the well-known governance problems in African countries and many developing countries today are mainly the reflection of their low level of development, and the results of failed state interventions and distortions originating from erroneous economic development strategies. The remainder of the paper is organized as follows: second section highlights the conflicting conclusions from various waves of research on the main pillar of good governance, which is generally seen to be a situation of low levels of corruption. Third section highlights the correlation between economic development and institutional development, and suggests a change in the approach to the fight against 'bad' governance.
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They are being hailed as the new Holy Grail of economic development. The success of special economic zones (SEZ) in general and specialized ones in particular (industrial and technology parks) in countries as diverse as Australia, Denmark, Sweden, Germany, Switzerland, Ireland, Japan, the United Kingdom, the United States, and more recently, China; Korea; Taiwan, China; or Mauritius, has led several African leaders to launch new similar initiatives.
... Exibir mais + This paper establishes a common point of reference for those who believe in the virtues of SEZs, explains why the many existing ones have not delivered the expected outcomes, and summarizes the key issues on the agenda. It then suggests cluster-based industrial parks as the most effective tool for developing competitive industries and generating employment, and provides some practical guidance to development practitioners and policymakers on the road ahead.
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Documento de trabalho sobre pesquisa de políticas WPS5900 DEC 01, 2011
Active economic policies by developing countries governments to promote growth and industrialization have generally been viewed with suspicion by economists, and for good reasons: past experiences show that such policies have too often failed to achieve their stated objectives.
... Exibir mais + But the historical record also indicates that in all successful economies, the state has always played an important role in facilitating structural change and helping the private sector sustain it across time. This paper proposes a new approach to help policymakers in developing countries identify those industries that may hold latent comparative advantage. It also recommends ways of removing binding constraints to facilitate private firms entry into those industries. The paper introduces an important distinction between two types of government interventions. First are policies that facilitate structural change by overcoming information and coordination and externality issues, which are intrinsic to industrial upgrading and diversification. Such interventions aim to provide information, compensate for externalities, and coordinate improvements in the "hard" and "soft" infrastructure that are needed for the private sector to grow in sync with the dynamic change in the economys comparative advantage. Second are those policies aimed at protecting some selected firms and industries that defy the comparative advantage determined by the existing endowment structureeither in new sectors that are too advanced or in old sectors that have lost comparative advantage.
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Documento de trabalho sobre pesquisa de políticas WPS5313 JAN 01, 2011
Despite its heavy human, financial, and economic cost, the recent global recession provides a unique opportunity to reflect on the knowledge from several decades of growth research, draw policy lessons from the experience of successful countries, and explore new approaches going forward.
... Exibir mais + In an increasingly globalized world where fighting poverty is not only a moral responsibility but also a strategy for confronting some of the major problems (diseases, malnutrition, insecurity and violence) that ignore boundaries and contribute to global insecurity, thinking about new ways of generating and sustaining growth is a crucial task for economists. This paper reassesses the evolution of knowledge on growth and suggests a new structural approach to the analysis. It offers a brief, critical review of lessons learned from growth research and examines the remaining challenges -- especially from the policy standpoint. It highlights how the 2008 Growth Commission Report identifies the stylized facts associated with sustained and inclusive growth. And it explains how the new structural economics provides a consistent framework for understanding the key findings of the Report.
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Documento de trabalho sobre pesquisa de políticas WPS5336 JUN 01, 2010
Active economic policies by developing countries governments to promote growth and industrialization have generally been viewed with suspicion by economists, and for good reasons: past experiences show that such policies have too often failed to achieve their stated objectives.
... Exibir mais + But the historical record also indicates that in all successful economies, the state has always played an important role in facilitating structural change and helping the private sector sustain it across time. This paper proposes a new approach to help policymakers in developing countries identify those industries that may hold latent comparative advantage. It also recommends ways of removing binding constraints to facilitate private firms entry into those industries. The paper introduces an important distinction between two types of government interventions. First are policies that facilitate structural change by overcoming information and coordination and externality issues, which are intrinsic to industrial upgrading and diversification. Such interventions aim to provide information, compensate for externalities, and coordinate improvements in the "hard" and "soft" infrastructure that are needed for the private sector to grow in sync with the dynamic change in the economys comparative advantage. Second are those policies aimed at protecting some selected firms and industries that defy the comparative advantage determined by the existing endowment structureeither in new sectors that are too advanced or in old sectors that have lost comparative advantage.
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Documento de trabalho sobre pesquisa de políticas WPS5313 MAY 01, 2010
Traditional narratives of external imbalances have focused on the analysis of national accounts, trade flows, and financial flows. They have generated two opposing views of the current situation of the world economy: on one side, a prudent, if not pessimistic view considers large imbalances as evidence of problems with the international monetary and financial system, and symptoms of domestic distortions (mainly in the United States and China).
... Exibir mais + On the other side, a relaxed, if not optimistic view suggests that global imbalances are not anomalies but simply the predictable outcome of a world with increasingly globalized financial flows in search of the right mix of risks and returns. The former view prescribes that the two largest countries in the world rebalance their economies to avoid the potentially painful cost of disruption and adjustment. The latter contends that global imbalances will be corrected through time by the normal functioning of market forces. This paper offers a critical analysis of these competing explanations of the United States-China imbalances and suggests a way of reconciling them. Starting with an exploration of the accounting frameworks that underpin any discussion of current account deficits and surpluses, the paper argues that China and the United States have become economically so interdependent that fears of any abrupt change in their current Nash equilibrium situation may be exaggerated. The paper also uses Hegels parable of the development of self-consciousness to explain the dynamics between the two countries. Hegel may not have been a great philosopher of history but his analysis of lordship and bondage (also known as the master-slave dynamics) provides a good framework for analyzing the dialectics of recognition and acknowledgement that currently characterizes the macroeconomic relationships between the United States and China.
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Documento de trabalho sobre pesquisa de políticas WPS5175 JAN 01, 2010
For decades, many researchers argued that economics had nothing to fear from enriching itself with lessons and advances from other disciplines.
... Exibir mais + Unfortunately, these suggestions were either neglected or dismissed upfront in what was then arbitrarily considered mainstream economics. The global crisis has led even Nobel Prize winners to acknowledge that the problem facing economists and policy makers today is mostly intellectual - it is the need to confront the systematic failure of thinking, especially on the part of macroeconomists. Despite its unprecedented magnitude and heavy financial, human, and intellectual cost, the crisis certainly does not invalidate everything that has been learned about macroeconomics. However, the costs highlight some of mistakes of the dominant intellectual macroeconomic framework. Post-macroeconomics should not be understood as another metanarrative of the end of metanarratives. The use of the prefix post here suggests and emphasizes much more than temporal posterity. Post-macroeconomics should follow from macroeconomics more than it follows after macroeconomics. The theorizing of post-macroeconomics is therefore neither systematically oppositional nor hegemonic. It does not advocate a - dialectic opposition - between macroeconomics and post-macroeconomics. Rather, it suggests that the latter builds on the former and goes beyond it.
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Documento de trabalho sobre pesquisa de políticas WPS4986 JUL 01, 2009
In times of crises, it is always useful to revisit some of the paradigms that underlie collective thinking and action. For nearly 200 years, most social science has relied on the assumption that the emergence of strong and nurturing social capital through a vibrant civil society yields all kind of positive externalities to society.
... Exibir mais + Following intuition and anecdotal observations from Alexis de Tocqueville, a large body of theoretical and empirical research has attempted to confirm that societies strive politically and economically when they are able to build strong non-state actors and community organizations. Many disciplines-mainly political science, economics, law, and international relations-have constructed influential analytical frameworks in support of that general proposition. This paper examines the philosophical foundations of conventional wisdom and observes that it often fails to take into account the dark side of some civil society groups, from the mafia to Al Qaeda. While acknowledging the potential contribution of civil society to the development process, the paper also cautions again the rush to circumvent the state, which sometimes sustains community-based initiatives in poor countries. It suggests the possibility of the production of negative social capital by non-state actors.
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Documento de trabalho sobre pesquisa de políticas WPS4942 MAY 01, 2009
This paper analyzes the dynamics of poverty and income inequality during the recovery phase of the transition that characterized the Republic of Latvia in the late 1990s.
... Exibir mais + Despite a continued rise in income inequality, empirical evidence suggests an improvement in living standards, owing largely to a significant surge in per capita income growth, particularly in urban areas. In a context of rising income inequality and widening urban-rural income and poverty gaps, the benefits of growth were not equally distributed, and poverty persisted in a number of regions (particularly the regions of Latgale and Vitzeme) and among some socioeconomic groups (particularly households deriving their main income from social benefits). In addition to income inequality and asset endowments, poverty appears to be highly correlated with a number of labor market-related variables, particularly unemployment, suggesting that the labor market could be an important transmission channel from growth to poverty. However, though positive, the association between poverty and unemployment is non linear, especially in urban areas, where the labor market and demand are the most important channels of transmission through which growth and macroeconomic development affect household income and living standards.
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Documento de trabalho sobre pesquisa de políticas WPS3336 JUN 01, 2004
Latvia's experience over the past decade shows that economic growth and real convergence can no longer be assumed to be exogenously driven processes determined by given technological improvements and relatively higher factor returns.
... Exibir mais + Instead, it is an endogenously driven process led by many variables, including policy variables. European Union membership clearly brings enormous economic benefits to Latvia. However, it also brings important challenges on the macroeconomic front, especially prior to the adoption of the euro. Substantial progress has been made toward fiscal consolidation since the mid-1990s but several risks remain. Given the facts that domestic demand remains buoyant and that Latvia will have to accommodate the expenditure commitments associated with NATO and EU membership while simultaneously aiming to fulfill the medium-term goal of a balanced budget, a more prudent fiscal policy should be the main short-term policy objective. The authorities should therefore reassess their current medium-term budget framework and strengthen their fiscal rules so that off-budget spending is eliminated and controls over spending ministries and local government finances are reinforced. They should also rethink any further tax reductions until a clear strategy is designed for compensating for projected losses in government revenues. Monetary policy can contribute to sustainable growth and job creation in Latvia in the medium and long term by providing an environment for price stability. It will have to be complemented by further microeconomic reforms and prudent wage developments aligned with productivity growth.
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Documento de trabalho sobre pesquisa de políticas WPS3307 MAY 01, 2004
The authors investigate the dynamics of poverty and income inequality in a cross-section of socio-economic groups and geographical regions over the five-year growth period following the 1994 devaluation of the CFA franc in Burkina Faso.
... Exibir mais + Results show rapidly increasing urban poverty accompanied by rising income inequality, declining poverty -growth elasticities, and significant changes in the poverty map. In rural areas, the incidence of poverty remained the same and income inequality did not increase. In contrast, the distribution of welfare across socio-economic groups was more stable. The rank ordering of socioeconomic groups on the welfare scale did not change during the post-devaluation growth period. Poverty remains largely a rural phenomenon, whose inelastic nature may justify a shift toward growth-oriented policies that at least maintain the rural poor's share of income to reduce poverty in the medium term. Among factors that feed into income inequality: disparities in wages and in educational attainment and unequal access to productive assets (especially human capital).
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Documento de trabalho sobre pesquisa de políticas WPS2590 APR 30, 2001
