Whatever Happened to the Third World?: A History of the Economics of Development

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https://www.palgrave.com/gp/book/9783030396121 How can the successful development of some former Third World countries be explained, while other developing countries have remained stagnant or worse, have deteriorated into failed states? This book offers a history of development economics. De Haan examines how the right mix of policies and evolving insights in development economics have impacted certain countries with the progression from low-income to middle-income, and even high-income status. In particular middle-income countries encounter hindrances to transit into high-income countries. The challenges of low-income countries and those of fragile and failed states is elaborated as well. Due attention is given to successive generations of development economists, economic growth models and international trade theories to provide academic background to the evolution or stagnation of developing countries. The author’s own experience in development aid is woven into the text, making this book important and entertaining reading for researchers, students of development economics, international trade and international aid. Preface Acknowledgments Contents List of Figures List of Tables Chapter 1: Introduction 1.1 Introduction 1.2 Global Economic Development 1.2.1 Growth Patterns of Developing Countries 1.2.2 The Gap Between Rich and Poor Countries 1.2.3 Inequality Within Countries 1.2.4 What Happened to the Third World The Middle-Income Trap Low-Income Countries and Fragile States 1.2.5 The Evolution of Development Economics The First Generation The Second Generation A Third Generation? Institutions Matter History Matters as Well New Economic Geography 1.2.6 Trade, Globalisation and Developnment International Trade Theories Globalisation International Trade Institutions GATT UNCTAD WTO Regional Trade Agreements How Developing Countries Fared How to Ward Off Protectionism 1.3 Conclusions References Chapter 2: Whatever Happened to the Third World 2.1 Introduction 2.2 The Evolution of the Third World in Figures 2.2.1 Trends 2.3 Trends in the Four Developing Regions 2.3.1 Asia 2.3.2 Latin America 2.3.3 Sub-Saharan Africa 2.3.4 The Middle East and North Africa 2.4 Categories of Countries 2.4.1 An Asian Success Story 2.4.2 The Middle-Income Trap Slowdowns Dissenters Alternative Approaches Skipping Industrialisation 2.4.3 Low-Income Countries and Failed States Damage Done What Can Be Done? Appendix 1: Lee Kuan Yew’s Singapore Introduction Success Factors Employment and Education Anticorruption Welfare Democracy and Development Appendix 2: The Middle-Income Trap in Figures References Chapter 3: What Preceded Development Economics 3.1 Introduction 3.2 What Scholars Thought About Development Before World War II 3.3 Civilisation and Climate 3.4 Dualism 3.5 The Role of Geography Revisited 3.6 Dualism Lives On References Chapter 4: The First Generation of Development Economists 4.1 Introduction 4.2 The Main Characteristics of the First Generation’s Proposals 4.2.1 The Role of Government 4.2.2 Development Planning 4.2.3 Balanced and Unbalanced Growth 4.2.4 The Crucial Role of Savings 4.2.5 Foreign Aid 4.2.6 Almighty Government? 4.3 The Harrod-Domar Model 4.4 The First Generation in More Detail 4.4.1 Paul Rosenstein-Rodan 4.4.2 Ragnar Nurkse 4.4.3 William Arthur Lewis 4.4.4 Simon Kuznets Quantitative Aspects of Economic Growth of Nations: VIII—Distribution of Income by Size32 4.4.5 Walt Whitman Rostow What Next? 4.4.6 Hollis Chenery 4.5 Dissenters 4.5.1 The Dirigiste Dogma 4.5.2 Failed Industrialisation 4.5.3 The Financing Gap and Aid 4.6 Conclusion 4.7 Development Theories in the Marxist Tradition References Chapter 5: The Second Generation of Development Economists 5.1 Introduction 5.2 The Philosophy 5.3 The Washington Consensus 5.4 Growth Theories Revisited 5.4.1 From Harrod-Domar to Solow 5.4.2 New Endogenous Growth Theory 5.4.2.1 Convergence 5.5 Empirical Studies 5.6 Asia and sub-Saharan Africa Compared 5.7 Dissenters 5.8 The Best of the Two Generations 5.8.1 The East Asian Miracle Common Threads Getting the Basics Right The Role of Government Institutions Comments 5.9 Conclusion References Chapter 6: Main Components of the Third Generation 6.1 Introduction 6.2 New Institutional Economics 6.2.1 The Role of Institutions 6.2.2 Path Dependency 6.2.3 Transaction Costs 6.2.4 Property Rights 6.2.5 Types of Societies 6.2.6 Why Nations Fail 6.2.7 Institutions and Geography 6.2.8 Markets Require Institutions 6.2.9 Measurement Challenges 6.2.10 Chicken and Egg 6.2.11 Democracy, Autocracy and Institutions 6.2.12 Conclusion 6.3 Economic History 6.3.1 From Stagnation to Growth: Unified Growth Theory 6.3.2 Demographic Transition in Less-Developed Countries 6.3.3 Unified Growth Theory 6.3.4 Unified Evolutionary Growth Theory 6.3.5 Differential Takeoffs and the Great Divergence 6.3.6 Conclusions 6.4 Long-Term Economic Growth and the History of Technology 6.4.1 A Historical Theory of Technology 6.4.2 The Intellectual Roots of the Industrial Revolution 6.4.3 The Emergence of Technological Modernity 6.4.4 Institutions and Technological Progress 6.4.5 Technology, Growth, and the Rise of the Occident 6.4.6 Conclusion 6.5 New Economic Geography 6.5.1 Increasing Returns and Economic Geography 6.5.2 Reshaping Economic Geography 6.5.3 Does the Report Reshape Economic Geography? 6.5.4 Conclusion 6.6 Overall Conclusion Appendix: Population Issues Falling Fertility Rates Demographic Dividend References Chapter 7: Trade, Globalisation and Development 7.1 Introduction 7.2 International Trade Theories 7.3 Globalisation 7.3.1 The Downside of Globalisation 7.4 The Institutions of Multilateralism 7.4.1 GATT 7.4.2 UNCTAD Prebisch and UNCTAD UNCTAD II Beyond UNCTAD II 7.4.3 GATT, UNCTAD, and the WTO The Kennedy Round The Uruguay Round 7.4.4 WTO 7.4.5 Regional Trade Agreements 7.5 How Developing Countries Fared 7.5.1 Trade Liberalisation and Poverty Reduction 7.5.2 Income Distribution 7.5.3 No Level Playing Field 7.5.4 Renewed Protectionism 7.5.5 How to Ward Off Protectionism 7.6 Conclusions References Epilogue Index