One is that neoclassical economic analysis is a lot more flexible than its practitioners in. Review of dani rodriks one economics, many recipes princeton university press, 2007. Exposing assumptions behind different reform strategies if you think we should do this, your model of the economy must be that allowing the systematic use of economic theory and evidence if this is the relevant model, these are what the evidence must. China could have minimized external imbalances through a timely appreciation of the renminbi, by reducing financial repression that has. Countries that have run their economies following the policy tenets of the professionals. Growth strategies dani rodrik as far as the ldcs are concerned, it is probably fair to say that at least a crude sort of justice prevails in the economic policy realm.
Introduction the last decade has been an extraordinarily good one for developing countries and their mostly poor citizensso good in fact that it has become commonplace to look upon them as potential saviors of the world economy. In the economic arena, chinese reformers used two related strategies to sim ultaneously. Industrial policy for a sustainable growth path abstract. We look for instances of rapid acceleration in economic growth that are sustained for at least 8 years and identify more than 80 such episodes since the 1950s.
The past, present, and future of economic growth global citizen. A paper for the handbook of economic growth, revised october 2004. Introduction green growth can be defined as a trajectory of economic development that fully internalizes environmental costs, including most critically those related to climate change, and that is based on sustainable use of nonrenewable. Evolution and current performance mulu gebreeyesus unumerit, maastricht. The mystery of the indian growth transition dani rodrik and arvind subramanian this paper explores the causes of indias productivity surge around 1980, more than. Identifying policy priorities what should we fix first. Handbook of economic growth vol 1, part a, pages 11060. This is an attempt to derive broad, strategic lessons from the diverse experience with economic growth in last 50 years. What we propose to do in this paper is to develop a framework for growth diagnostics that is, a strategy for figuring out the policy priorities. The real lesson for the architects of growth strategies is to take economics more seriously, not less seriously.
Since the reasons for the disappointing growth performance. The why and how of growth diagnostics school of social. The strategy is aimed at identifying the most binding constraints on economic activity, and hence the set of policies that, once targeted on these constraints at. Unlike most cross country growth analyses, we focus on turning points in growth performance. Successful economic growth strategies have always required a judicious blend of imported practices with domestic institutional innovations. One is that neoclassical economic analysis is a lot more flexible than its practitioners in the policy domain have generally given it credit. Economic fluctuations and growth, international finance and macroeconomics, international trade and investment this is an attempt to derive broad, strategic lessons from the diverse experience with economic growth in last fifty years. Ch 14 growth strategies, pp 9671014 dani rodrik ch 15 national policies and economic growth. Why we learn nothing from regressing economic growth on. We redefine industrial policy for industrialised countries as a strategy to promote highroad competitiveness, understood as. Although the report does not quite put it in this way, what i think the. Why were such different strategies chosen to promote industry. He has published widely in the areas of economic development, international economics, and political economy. Growth strategies weatherhead center for international.
The way in which the authors tackle the analysis of growth strategies in this context is by. Srinivasan jagdish bhagwati yale university columbia university abstract the costs of import substitution is as a strategy for industrialization, which was deemed synonymous with economic development by many development economists of the fifties and sixties. In addressing rethinking economic growth strategies i will explain in greater detail that. Review of rodriks one economics, many recipes final v2. Growth strategies why inorganic growth external industry and economic factors play a crucial role slowing industry growth rate, fragmented industry and too many competitors fighting for the same market share an economic slump creates opportunities for cash rich companies to get hold of unutilised. Comment on hausmann and rodrik wesleyan university. Start from activities that are the proximate determinants of growth, xi.
Globalization, social conflict and economic growth 1 dani rodrik revised, december 11, 1997 1. What the experience of the last 15 years has shown, however, is that the im. Economic fluctuations and growth, international finance and macroeconomics, international trade and investment. Academic economics, with its refusal to make unconditional generalisations and its careful examination of the contingent relation between the economic environment and policy implications, is. I have more to say on these growth strategies below. Second, trying to come up with an identical growth strategy for all countries, regardless of their circumstances, is unlikely to prove productive.
Industrial policy is back on the agenda and the consensus is that it must be different this time from the past. Working paper 10050 national bureau of economic research. The 8th wider annual lecture was given by professor dani rodrik in helsinki on 5th november 2004, under the title rethinking growth strategies. Rodriks sabot lecture will focus on africas recent economic growth.
As with the explanation for the calico acts, the impulse of many scholars is to attribute this variation in. It has now become the latest poster child for efforts. Introduction the idea of a mixed economy is possibly the most valuable heritage that the twentieth century bequeaths to the twentyfirst in the realm of economic policy. The views expressed in this working paper are those of the authors and do not necessarily represent. Crosscountry regressions have been the tool of choice in asses sing the effectiveness of policies and the empirical relevance of th. Nber working paper series growth strategies working paper.
Development strategies for the next century1 dani rodrik harvard university i. Globalization, institutions and economic growth 2007 the central lesson from the past 50 years of development research and policy is that economic growth is the most effective way to pull people out of poverty and deliver on their wider objectives for a better life. Dani rodrik is ford foundation professor of international political economy at the harvard kennedy school. Development strategies for the next century1 dani rodrik harvard university february 2000 i. An important distinction highlighted by rodrik is defined by the terms growth ignition, and growth sustainability rodrik 2003, 1415. The past, present, and future of economic growth dani rodrik 1.
This is an attempt to derive broad, strategic lessons from the diverse experience with economic growth in last fifty years. Dani rodrik school of social science institute for. The middle east and latin america, which had led the developing world in tfp growth prior to 1973, not only fell behind, but actually experienced negative tfp growth on average thereafter. But globaliza tion is not a shortcut to development. Dani rodrik is the rafiq hariri professor of international political economy at the john. Dani rodrik, harvard university one economics, many recipes. This interpretation of the east asian experience heavily influenced the famous. Rodrik s recent papers on growth, institutions, and globalization, but they constitute a. Ricardo hausmann dani rodrik andros velasco revised march 2005 1introduction most welltrained economists would agree that the standard policy reforms included in the washington consensus have the potential to be growth promoting. Policymakers need to forge a domestic growth strategy by relying on domestic investors and domestic institutions. In particular, firstorder economic principles protection of property. Reform strategies should be principally targeted at raising rates of growth sthat is, they should be growth strategies. Unlike in the other two regions, where growth had been slow and erratic, asian growth tended to rely heavily on the engine of structural change. The past, present, and future of economic growth school of social.
Rodriks recent papers on growth, institutions, and globalization, but they. Rodrik makes a persuasive case for an alternative strategy which has profound implications for the construction of economic policy in developing countries. The weights one places on these considerationsand many othersdepend on ones views as to the ultimate drivers of economic growth in lagging countries. The costliest downside of the integrationist faith is that it crowds out. Fourth and finally, is rodrik correct in maintaining that, a trade surplus is only an incidental consequence of chinas growth strategy and more the result of our present global rules p. Growth strategies dani rodrik nber working paper no. Sometimes th e desired ends are worthwhile, and sometimes they are pernicious. An institution building strategy to sustain growth 1005 6.
O1, o4 abstract this is an attempt to derive broad, strategic lessons from the diverse experience with economic. Why we learn nothing from regressing economic growth on policies 1 dani rodrik government use policy to achieve certain outcomes. In addressing rethinking economic growth strategies i will explain in greater detail that the kind of certainty and consensus that existed in the mid1990s about the appropriate policy framework for economic growth has almost disappeared. Development strategies for the next century1 dani rodrik. Introduction to any economist interested in growth. His current research focuses on employment and economic growth, in both developing and advanced economies. According to him, evidence of economic growth indicates that it is generally easier to kickstart growth than to maintain sustainable growth levels over time. Stated in its starkest form, this view is that economic growth requires two things. Hence my account harks back to an earlier generation of studies that distilled operational lessons from the observed growth experience, such as albert hirschmans the strategy of economic development 1958, alexander.
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