Development-Which_way_now-summary

Development-Which_wa - Article 1 Development Which Way Now by Amartya Sen I The promise and the default This paper provides a critical perspective

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Article 1: Development: Which Way Now? by Amartya Sen I. The promise and the default: This paper provides a critical perspective about the status of economic development as a discipline. According to Sen, the traditional economic models have not been unsuccessful in identifying the factors of growth in developing nations. However, they fall short in characterizing economic development which involves expansion of people’s capabilities. Sen criticizes the paper written by Albert Hirschman titled “The rise and decline of economic development” on the ground of methodological approach. The traditional mainstream development economics began with a set of favorite themes and the main approaches to the subject have been molded by these motifs. These motifs are fundamentally erroneous or misguided. Two central thoughts in development economics are identified: rural underdevelopment and late industrialization. Solutions suggested: Use undeveloped manpower and accelerate capital accumulation. To address the problem of late industrialization, have an active state and planning. Policy option proposed: 1. Industrialization 2. Rapid capital accumulation 3. Mobilization of underdeveloped manpower
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4. Planning and an economically active state The traditional development economics is criticized on the ground that it places too much emphasis on neoclassical economics. It is argued that by development economists that neoclassical economics does not apply terribly well to underdeveloped countries. Sen argues that it should not a surprise since neoclassical economics does not apply terribly well anywhere else. On the other hand, the neoclassical economists argue that departure from these models in many ways is more radical. They draw much sustenance for this claim from the success of high performance economies of South Korea, Taiwan, Hong Kong and Singapore. II. Traditional themes in the light of recent experiences: Economic growth is not same as economic development and it is only one aspect of the process of development. However, traditional development economics has concentrated on the idea of promoting growth. Sen examines the appropriateness of traditional themes of development economics given their concentration on growth. He uses the data from The World Development Report for 14 low income and 18 middle income countries. He points out the relationship between economic growth and factors that contributed to growth. There is positive relationship between growth and these factors: 1. Industrialization 2. Rapid capital accumulation 3. Mobilization of underdeveloped manpower 4. Planning and an economically active state Conclusion: The traditional economics do well in terms of identifying the factors of economic growth.
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III. Fast growth and low social change: The real limitations of traditional development economics arises not from the choice of means to the end of economic growth, but in the insufficient recognition that economic growth is no more than a means to other objectives. Growth does matter but it matters because of some associated
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This note was uploaded on 02/05/2012 for the course ECON 383 taught by Professor Nafeezfatima during the Fall '11 term at Waterloo.

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Development-Which_wa - Article 1 Development Which Way Now by Amartya Sen I The promise and the default This paper provides a critical perspective

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