Econ11.24.10

Econ11.24.10 - A Competing Explanations 1 Neoclassical...

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A. Competing Explanations 1. Neoclassical explanations: market and price mechanism Y=At(H+K) k, h, a At: efficient allocation of resources, effective use of techniques Savings rate, n, d How did large quantities of k, h, l come about in first place? 2. Statist explanation: pervasive role of the state in driving economic policy Alice Amsden 1989: S Korea late industrialization distorted prices Robert Wade: 1990 Taiwan Stephen Haggard: 1990 HK, S, K, T ISI->export promotion WB Miracle Report 1993: “market friendly approach” Good: strong role of government Detailed empirical analysis (i)no consensus as to what kind of state intervention is required (ii)Economic complexity increases->state no longer able to intervene effectively (iii)no systematic analysis of origin of strength 3.Cultural explanations: Confucian culture of advantage (accept authority, education, self-discipline, hard work) (i)Max Weber: Confucianism hampers economic growth
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Econ11.24.10 - A Competing Explanations 1 Neoclassical...

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