New Structural Economics : A Framework for Rethinking Development
As strategies for achieving sustainable growth in developing countries are re-examined in light of the financial crisis, it is critical to take into account structural change and its corollary, industrial upgrading. Economic literature has devoted...
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
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World Bank, Washington, DC
2014
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| Online Access: | http://documents.worldbank.org/curated/en/2010/02/11737058/new-structural-economics-framework-rethinking-development http://hdl.handle.net/10986/19919 |
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okr-10986-19919 |
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oai_dc |
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Digital Repository |
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Foreign Institution |
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Digital Repositories |
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World Bank Open Knowledge Repository |
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World Bank |
| language |
English en_US |
| topic |
ACCESS TO INFORMATION AGRICULTURE AMOUNT OF CAPITAL ARBITRAGE BANK ACCOUNT BANK LENDING BINDING CONSTRAINT BOND BOND FINANCING BUDGET CONSTRAINTS BUSINESS CYCLES CAPITAL INFLOWS CAPITAL INVESTMENT CAPITAL REQUIREMENTS CENTRAL BANK CENTRAL BANKS CENTRAL PLANNING CLASSICAL ECONOMICS COLLECTIVE ACTION COLLECTIVE ACTIONS COMMODITY PRICE COMMODITY PRICES COMPARATIVE ADVANTAGE COMPARATIVE ADVANTAGES COMPETITIVE ADVANTAGE COMPETITIVE MARKET COMPETITIVE MARKETS CREDIT RATIONING CURRENCY COMPOSITION DEBT DEBT CRISIS DECISION TREE DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPMENT AGENCIES DEVELOPMENT ECONOMICS DEVELOPMENT POLICIES DEVELOPMENT PROJECTS DEVELOPMENT STRATEGIES DEVELOPMENT STRATEGY DOMESTIC CURRENCIES DOMESTIC CURRENCY DOMESTIC MARKET DOMESTIC MARKETS ECONOMIC COOPERATION ECONOMIC DEVELOPMENT ECONOMIC EFFICIENCY ECONOMIC GROWTH ECONOMIC HISTORIANS ECONOMIC LIBERALIZATION ECONOMIC LIFE ECONOMIC SECTORS ECONOMIC STRUCTURE ECONOMIC STRUCTURES ECONOMIC SYSTEMS ECONOMIC THEORIES ECONOMIC THEORY ECONOMICS ECONOMICS LITERATURE ECONOMICS RESEARCH ECONOMIES OF SCALE ECONOMISTS ELASTICITY EQUIPMENT EQUITY MARKET EQUITY MARKETS EXCESS DEMAND EXCHANGE RATE EXPENDITURE EXPENDITURES EXTERNAL ASSETS EXTERNAL FUNDING EXTERNALITIES EXTERNALITY FINANCIAL CAPITAL FINANCIAL CRISIS FINANCIAL DEVELOPMENT FINANCIAL HISTORY FINANCIAL SECTOR FINANCIAL STRUCTURE FINANCIAL SYSTEM FIRM PERFORMANCE FISCAL POLICIES FISCAL POLICY FOREIGN CAPITAL FOREIGN CURRENCY FOREIGN DIRECT INVESTMENT FOREIGN EQUITY FOREIGN EXCHANGE FOREIGN EXCHANGE RESERVE FREE TRADE GDP GLOBAL ECONOMY GLOBAL MARKET GLOBAL MARKETS GLOBALIZATION GOVERNMENT INTERVENTION GOVERNMENT INTERVENTIONS GOVERNMENT INVESTMENT GOVERNMENT REVENUES GOVERNMENT SAVINGS GOVERNMENT SPENDING GROSS DOMESTIC PRODUCT GROSS NATIONAL PRODUCT GROWTH POTENTIAL GROWTH RATE HUMAN CAPITAL IMPORT QUOTAS INCOME INCOME LEVEL INCOME LEVELS INDUSTRIALIZATION INEFFICIENCY INFLATION INFLATION RATES INFORMATIONAL ASYMMETRY INFRASTRUCTURE INVESTMENTS INSTRUMENT INSURANCE INTANGIBLE INTEREST RATE INTEREST RATE POLICY INTEREST RATES INTERNATIONAL BANK INTERNATIONAL FINANCIAL INSTITUTIONS INTERNATIONAL FINANCIAL MARKETS INTERNATIONAL MARKETS INTERNATIONAL TRADE INVESTMENT CLIMATE INVESTMENT DECISION INVESTMENT INSTRUMENTS INVESTMENT OPPORTUNITIES INVESTMENT PROJECTS KEYNESIAN ECONOMICS LAISSEZ FAIRE LEGAL FRAMEWORK LEGAL FRAMEWORKS LENDERS LEVEL OF RISK LIQUIDITY LOCAL BANKS LOCAL MARKETS MACROECONOMIC ENVIRONMENT MACROECONOMIC MANAGEMENT MACROECONOMIC POLICIES MACROECONOMIC VOLATILITY MACROECONOMICS MARGINAL RATE OF RETURN MARKET CONFIDENCE MARKET ECONOMIES MARKET ECONOMY MARKET FAILURES MARKET MECHANISM MARKET SHARES MARKET SIZE MARKET TRANSACTIONS MATURE MARKETS MATURITY MICROECONOMIC ANALYSES MONETARY POLICY MONEY SUPPLY MONOPOLIES MONOPOLY MULTIPLIERS NATIONAL ECONOMIES NATIONAL INCOME NATURAL MONOPOLIES NATURAL RESOURCES NEOCLASSICAL ECONOMICS NET EXPORTS OPEN ECONOMY OUTSTANDING DEBT OVERVALUATION PATENTS PER CAPITA INCOME PORTFOLIO PORTFOLIO MANAGEMENT PRICE ELASTICITY PRICE ELASTICITY OF DEMAND PRICE FLUCTUATIONS PRICE STABILITY PRIVATE CAPITAL PRIVATE CAPITAL INFLOWS PRIVATE INVESTMENT PRODUCTION COSTS PRODUCTIVITY GROWTH PRODUCTIVITY INCREASES PROPERTY RIGHTS PROTECTIONISM PUBLIC INVESTMENTS PURCHASING POWER RESERVES RETURNS RISK SHARING SHADOW PRICES SHORT-TERM INTEREST RATES SOCIAL CAPITAL SOCIAL NETWORKS STRUCTURAL CHANGE TAX TAX REVENUES TAX SUBSIDIES TELECOMMUNICATIONS TOTAL OUTPUT TRANSACTION TRANSACTION COST TRANSACTION COSTS TRANSITION ECONOMIES TRANSPARENCY TRUST FUND UNEMPLOYMENT WAGES WEALTH |
| spellingShingle |
ACCESS TO INFORMATION AGRICULTURE AMOUNT OF CAPITAL ARBITRAGE BANK ACCOUNT BANK LENDING BINDING CONSTRAINT BOND BOND FINANCING BUDGET CONSTRAINTS BUSINESS CYCLES CAPITAL INFLOWS CAPITAL INVESTMENT CAPITAL REQUIREMENTS CENTRAL BANK CENTRAL BANKS CENTRAL PLANNING CLASSICAL ECONOMICS COLLECTIVE ACTION COLLECTIVE ACTIONS COMMODITY PRICE COMMODITY PRICES COMPARATIVE ADVANTAGE COMPARATIVE ADVANTAGES COMPETITIVE ADVANTAGE COMPETITIVE MARKET COMPETITIVE MARKETS CREDIT RATIONING CURRENCY COMPOSITION DEBT DEBT CRISIS DECISION TREE DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPMENT AGENCIES DEVELOPMENT ECONOMICS DEVELOPMENT POLICIES DEVELOPMENT PROJECTS DEVELOPMENT STRATEGIES DEVELOPMENT STRATEGY DOMESTIC CURRENCIES DOMESTIC CURRENCY DOMESTIC MARKET DOMESTIC MARKETS ECONOMIC COOPERATION ECONOMIC DEVELOPMENT ECONOMIC EFFICIENCY ECONOMIC GROWTH ECONOMIC HISTORIANS ECONOMIC LIBERALIZATION ECONOMIC LIFE ECONOMIC SECTORS ECONOMIC STRUCTURE ECONOMIC STRUCTURES ECONOMIC SYSTEMS ECONOMIC THEORIES ECONOMIC THEORY ECONOMICS ECONOMICS LITERATURE ECONOMICS RESEARCH ECONOMIES OF SCALE ECONOMISTS ELASTICITY EQUIPMENT EQUITY MARKET EQUITY MARKETS EXCESS DEMAND EXCHANGE RATE EXPENDITURE EXPENDITURES EXTERNAL ASSETS EXTERNAL FUNDING EXTERNALITIES EXTERNALITY FINANCIAL CAPITAL FINANCIAL CRISIS FINANCIAL DEVELOPMENT FINANCIAL HISTORY FINANCIAL SECTOR FINANCIAL STRUCTURE FINANCIAL SYSTEM FIRM PERFORMANCE FISCAL POLICIES FISCAL POLICY FOREIGN CAPITAL FOREIGN CURRENCY FOREIGN DIRECT INVESTMENT FOREIGN EQUITY FOREIGN EXCHANGE FOREIGN EXCHANGE RESERVE FREE TRADE GDP GLOBAL ECONOMY GLOBAL MARKET GLOBAL MARKETS GLOBALIZATION GOVERNMENT INTERVENTION GOVERNMENT INTERVENTIONS GOVERNMENT INVESTMENT GOVERNMENT REVENUES GOVERNMENT SAVINGS GOVERNMENT SPENDING GROSS DOMESTIC PRODUCT GROSS NATIONAL PRODUCT GROWTH POTENTIAL GROWTH RATE HUMAN CAPITAL IMPORT QUOTAS INCOME INCOME LEVEL INCOME LEVELS INDUSTRIALIZATION INEFFICIENCY INFLATION INFLATION RATES INFORMATIONAL ASYMMETRY INFRASTRUCTURE INVESTMENTS INSTRUMENT INSURANCE INTANGIBLE INTEREST RATE INTEREST RATE POLICY INTEREST RATES INTERNATIONAL BANK INTERNATIONAL FINANCIAL INSTITUTIONS INTERNATIONAL FINANCIAL MARKETS INTERNATIONAL MARKETS INTERNATIONAL TRADE INVESTMENT CLIMATE INVESTMENT DECISION INVESTMENT INSTRUMENTS INVESTMENT OPPORTUNITIES INVESTMENT PROJECTS KEYNESIAN ECONOMICS LAISSEZ FAIRE LEGAL FRAMEWORK LEGAL FRAMEWORKS LENDERS LEVEL OF RISK LIQUIDITY LOCAL BANKS LOCAL MARKETS MACROECONOMIC ENVIRONMENT MACROECONOMIC MANAGEMENT MACROECONOMIC POLICIES MACROECONOMIC VOLATILITY MACROECONOMICS MARGINAL RATE OF RETURN MARKET CONFIDENCE MARKET ECONOMIES MARKET ECONOMY MARKET FAILURES MARKET MECHANISM MARKET SHARES MARKET SIZE MARKET TRANSACTIONS MATURE MARKETS MATURITY MICROECONOMIC ANALYSES MONETARY POLICY MONEY SUPPLY MONOPOLIES MONOPOLY MULTIPLIERS NATIONAL ECONOMIES NATIONAL INCOME NATURAL MONOPOLIES NATURAL RESOURCES NEOCLASSICAL ECONOMICS NET EXPORTS OPEN ECONOMY OUTSTANDING DEBT OVERVALUATION PATENTS PER CAPITA INCOME PORTFOLIO PORTFOLIO MANAGEMENT PRICE ELASTICITY PRICE ELASTICITY OF DEMAND PRICE FLUCTUATIONS PRICE STABILITY PRIVATE CAPITAL PRIVATE CAPITAL INFLOWS PRIVATE INVESTMENT PRODUCTION COSTS PRODUCTIVITY GROWTH PRODUCTIVITY INCREASES PROPERTY RIGHTS PROTECTIONISM PUBLIC INVESTMENTS PURCHASING POWER RESERVES RETURNS RISK SHARING SHADOW PRICES SHORT-TERM INTEREST RATES SOCIAL CAPITAL SOCIAL NETWORKS STRUCTURAL CHANGE TAX TAX REVENUES TAX SUBSIDIES TELECOMMUNICATIONS TOTAL OUTPUT TRANSACTION TRANSACTION COST TRANSACTION COSTS TRANSITION ECONOMIES TRANSPARENCY TRUST FUND UNEMPLOYMENT WAGES WEALTH Lin, Justin Yifu New Structural Economics : A Framework for Rethinking Development |
| relation |
Policy Research Working Paper;No. 5197 |
| description |
As strategies for achieving sustainable
growth in developing countries are re-examined in light of
the financial crisis, it is critical to take into account
structural change and its corollary, industrial upgrading.
Economic literature has devoted a great deal of attention to
the analysis of technological innovation, but not enough to
these equally important issues. The new structural economics
outlined in this paper suggests a framework to complement
previous approaches in the search for sustainable growth
strategies. It takes the following into consideration:
First, an economy's structure of factor endowments
evolves from one stage of development to another. Therefore,
the optimal industrial structure of a given economy will be
different at different stages of development. Each
industrial structure requires corresponding infrastructure
(both "hard" and "soft") to facilitate
its operations and transactions. Second, each stage of
economic development is a point along the continuum from a
low-income agrarian economy to a high-income industrialized
economy, not a dichotomy of two economic development stages
("poor" versus "rich" or
"developing" versus "industrialized").
Industrial upgrading and infrastructure improvement targets
in developing countries should not necessarily draw from
those that exist in high-income countries. Third, at each
given stage of development, the market is the basic
mechanism for effective resource allocation. However,
economic development as a dynamic process requires
industrial upgrading and corresponding improvements in
"hard" and "soft" infrastructure at each
stage. Such upgrading entails large externalities to
firms' transaction costs and returns to capital
investment. Thus, in addition to an effective market
mechanism, the government should play an active role in
facilitating industrial upgrading and infrastructure improvements. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Lin, Justin Yifu |
| author_facet |
Lin, Justin Yifu |
| author_sort |
Lin, Justin Yifu |
| title |
New Structural Economics : A Framework for Rethinking Development |
| title_short |
New Structural Economics : A Framework for Rethinking Development |
| title_full |
New Structural Economics : A Framework for Rethinking Development |
| title_fullStr |
New Structural Economics : A Framework for Rethinking Development |
| title_full_unstemmed |
New Structural Economics : A Framework for Rethinking Development |
| title_sort |
new structural economics : a framework for rethinking development |
| publisher |
World Bank, Washington, DC |
| publishDate |
2014 |
| url |
http://documents.worldbank.org/curated/en/2010/02/11737058/new-structural-economics-framework-rethinking-development http://hdl.handle.net/10986/19919 |
| _version_ |
1764444052339556352 |
| spelling |
okr-10986-199192021-04-23T14:03:52Z New Structural Economics : A Framework for Rethinking Development Lin, Justin Yifu ACCESS TO INFORMATION AGRICULTURE AMOUNT OF CAPITAL ARBITRAGE BANK ACCOUNT BANK LENDING BINDING CONSTRAINT BOND BOND FINANCING BUDGET CONSTRAINTS BUSINESS CYCLES CAPITAL INFLOWS CAPITAL INVESTMENT CAPITAL REQUIREMENTS CENTRAL BANK CENTRAL BANKS CENTRAL PLANNING CLASSICAL ECONOMICS COLLECTIVE ACTION COLLECTIVE ACTIONS COMMODITY PRICE COMMODITY PRICES COMPARATIVE ADVANTAGE COMPARATIVE ADVANTAGES COMPETITIVE ADVANTAGE COMPETITIVE MARKET COMPETITIVE MARKETS CREDIT RATIONING CURRENCY COMPOSITION DEBT DEBT CRISIS DECISION TREE DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPMENT AGENCIES DEVELOPMENT ECONOMICS DEVELOPMENT POLICIES DEVELOPMENT PROJECTS DEVELOPMENT STRATEGIES DEVELOPMENT STRATEGY DOMESTIC CURRENCIES DOMESTIC CURRENCY DOMESTIC MARKET DOMESTIC MARKETS ECONOMIC COOPERATION ECONOMIC DEVELOPMENT ECONOMIC EFFICIENCY ECONOMIC GROWTH ECONOMIC HISTORIANS ECONOMIC LIBERALIZATION ECONOMIC LIFE ECONOMIC SECTORS ECONOMIC STRUCTURE ECONOMIC STRUCTURES ECONOMIC SYSTEMS ECONOMIC THEORIES ECONOMIC THEORY ECONOMICS ECONOMICS LITERATURE ECONOMICS RESEARCH ECONOMIES OF SCALE ECONOMISTS ELASTICITY EQUIPMENT EQUITY MARKET EQUITY MARKETS EXCESS DEMAND EXCHANGE RATE EXPENDITURE EXPENDITURES EXTERNAL ASSETS EXTERNAL FUNDING EXTERNALITIES EXTERNALITY FINANCIAL CAPITAL FINANCIAL CRISIS FINANCIAL DEVELOPMENT FINANCIAL HISTORY FINANCIAL SECTOR FINANCIAL STRUCTURE FINANCIAL SYSTEM FIRM PERFORMANCE FISCAL POLICIES FISCAL POLICY FOREIGN CAPITAL FOREIGN CURRENCY FOREIGN DIRECT INVESTMENT FOREIGN EQUITY FOREIGN EXCHANGE FOREIGN EXCHANGE RESERVE FREE TRADE GDP GLOBAL ECONOMY GLOBAL MARKET GLOBAL MARKETS GLOBALIZATION GOVERNMENT INTERVENTION GOVERNMENT INTERVENTIONS GOVERNMENT INVESTMENT GOVERNMENT REVENUES GOVERNMENT SAVINGS GOVERNMENT SPENDING GROSS DOMESTIC PRODUCT GROSS NATIONAL PRODUCT GROWTH POTENTIAL GROWTH RATE HUMAN CAPITAL IMPORT QUOTAS INCOME INCOME LEVEL INCOME LEVELS INDUSTRIALIZATION INEFFICIENCY INFLATION INFLATION RATES INFORMATIONAL ASYMMETRY INFRASTRUCTURE INVESTMENTS INSTRUMENT INSURANCE INTANGIBLE INTEREST RATE INTEREST RATE POLICY INTEREST RATES INTERNATIONAL BANK INTERNATIONAL FINANCIAL INSTITUTIONS INTERNATIONAL FINANCIAL MARKETS INTERNATIONAL MARKETS INTERNATIONAL TRADE INVESTMENT CLIMATE INVESTMENT DECISION INVESTMENT INSTRUMENTS INVESTMENT OPPORTUNITIES INVESTMENT PROJECTS KEYNESIAN ECONOMICS LAISSEZ FAIRE LEGAL FRAMEWORK LEGAL FRAMEWORKS LENDERS LEVEL OF RISK LIQUIDITY LOCAL BANKS LOCAL MARKETS MACROECONOMIC ENVIRONMENT MACROECONOMIC MANAGEMENT MACROECONOMIC POLICIES MACROECONOMIC VOLATILITY MACROECONOMICS MARGINAL RATE OF RETURN MARKET CONFIDENCE MARKET ECONOMIES MARKET ECONOMY MARKET FAILURES MARKET MECHANISM MARKET SHARES MARKET SIZE MARKET TRANSACTIONS MATURE MARKETS MATURITY MICROECONOMIC ANALYSES MONETARY POLICY MONEY SUPPLY MONOPOLIES MONOPOLY MULTIPLIERS NATIONAL ECONOMIES NATIONAL INCOME NATURAL MONOPOLIES NATURAL RESOURCES NEOCLASSICAL ECONOMICS NET EXPORTS OPEN ECONOMY OUTSTANDING DEBT OVERVALUATION PATENTS PER CAPITA INCOME PORTFOLIO PORTFOLIO MANAGEMENT PRICE ELASTICITY PRICE ELASTICITY OF DEMAND PRICE FLUCTUATIONS PRICE STABILITY PRIVATE CAPITAL PRIVATE CAPITAL INFLOWS PRIVATE INVESTMENT PRODUCTION COSTS PRODUCTIVITY GROWTH PRODUCTIVITY INCREASES PROPERTY RIGHTS PROTECTIONISM PUBLIC INVESTMENTS PURCHASING POWER RESERVES RETURNS RISK SHARING SHADOW PRICES SHORT-TERM INTEREST RATES SOCIAL CAPITAL SOCIAL NETWORKS STRUCTURAL CHANGE TAX TAX REVENUES TAX SUBSIDIES TELECOMMUNICATIONS TOTAL OUTPUT TRANSACTION TRANSACTION COST TRANSACTION COSTS TRANSITION ECONOMIES TRANSPARENCY TRUST FUND UNEMPLOYMENT WAGES WEALTH As strategies for achieving sustainable growth in developing countries are re-examined in light of the financial crisis, it is critical to take into account structural change and its corollary, industrial upgrading. Economic literature has devoted a great deal of attention to the analysis of technological innovation, but not enough to these equally important issues. The new structural economics outlined in this paper suggests a framework to complement previous approaches in the search for sustainable growth strategies. It takes the following into consideration: First, an economy's structure of factor endowments evolves from one stage of development to another. Therefore, the optimal industrial structure of a given economy will be different at different stages of development. Each industrial structure requires corresponding infrastructure (both "hard" and "soft") to facilitate its operations and transactions. Second, each stage of economic development is a point along the continuum from a low-income agrarian economy to a high-income industrialized economy, not a dichotomy of two economic development stages ("poor" versus "rich" or "developing" versus "industrialized"). Industrial upgrading and infrastructure improvement targets in developing countries should not necessarily draw from those that exist in high-income countries. Third, at each given stage of development, the market is the basic mechanism for effective resource allocation. However, economic development as a dynamic process requires industrial upgrading and corresponding improvements in "hard" and "soft" infrastructure at each stage. Such upgrading entails large externalities to firms' transaction costs and returns to capital investment. Thus, in addition to an effective market mechanism, the government should play an active role in facilitating industrial upgrading and infrastructure improvements. 2014-09-02T18:25:20Z 2014-09-02T18:25:20Z 2010-02 http://documents.worldbank.org/curated/en/2010/02/11737058/new-structural-economics-framework-rethinking-development http://hdl.handle.net/10986/19919 English en_US Policy Research Working Paper;No. 5197 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research |