Economic Structure and Performance

Economic Structure and Performance: Essays in Honor of Hollis B. Chenery briefly reviews the work of Hollis Chenery in the field of economics. This book discusses the underlying themes in Chenery's work, including structure, strategy, adjustment, and models. Organized into four parts encompassing 26 chapters, this book begins with an overview of the patterns of structural change and their relation to growth. This text then examines the objectives, measures, and implementation of policy, as well as administrative capabilities and cultural characteristics. Other chapters compare Chenery's econometric analysis of development patterns with the historical analyses and suggest that the two approaches complement each other. This book discusses as well the persistence of disequilibrium in segments of the economy. The final chapter deals with simple criteria for detecting critical interdependencies and a formula for measuring their welfare consequences. This book is a valuable resource for economists, industrialists, foreign capitalists, and social scientists.

Contributors

Preface

Publications of Hollis B. Chenery

Part I Structure

1. The Chenery Analysis and Some Other Considerations

Introduction

Comparison of Egypt and Korea

Differences in Goals

Differences in Managing Public Enterprise

Differences in Managing the Incentives to Private Enterprise

Differences in Managing the Implementation of Policy

Differences in the Management of Planning

The Cultural Milieu

Notes

References

2. Typology in Development Theory: Retrospective and Prospects

Introduction

Convergent Approaches Outlined

A Brief Demonstration of the Comparative Historical Analysis Approach

Prospects

Notes

References

3. Patterns of Economic Growth, 1850-1914, or Chenery-Syrquin in Historical Perspective

Introduction

Method

Data

Statistical Results: All Countries

Comparison of Historical with Contemporary Patterns

Typologies of Industrialization

Conclusions

Appendix A: Summary Definitions of Classificatory Indicators

Notes

References

4. Resource Reallocation and Productivity Growth

Introduction

Labor Shifts and the Growth of Labor Productivity: Partial Measures

Resource Reallocation and Total Factor Productivity Growth

The Gains from Reallocation: Empirical Results

Conclusions

Appendix A

Notes

References

5. Class Alliances and Surplus Labor Time

Introduction

Surplus Labor Time

Class and State Incomes

Alliance and Conflict

Notes

References

6. Some Elements of a Marxist Theory of Socialist Economic Development

Introduction: Assumptions and Definitions

A Model of Socialist and Communist Goals

Strategies for Attaining Socialism

The Strategy of Socialist Transformation

The Strategy of Raising the Productive Forces

Combined and Mixed Strategies

Productive Forces and Relations of Production

Conclusions

Notes

Part II Strategy

7. Comparative Advantage and Development Policy 20 Years Later

Introduction

Trade Policy versus Growth, circa 1960

Experience with Export-Led Growth

Inner- and Outer-Oriented Strategies Contrasted

Why is Performance Different?

Summary and Conclusions

Notes

References

8. Development Problems of the Mineral-Rich Countries

Introduction

Mineral Policy Problems in General

The Nature of Mining Projects

The Automatic Adjustment Mechanism in MRCs

Some Implications

Notes

References

9. Step-by-Step Liberalization of a Controlled Economy: Experience in Egypt

Liberalization as a Step-by-Step Process

The System of Economic Controls in Egypt in the Early 1970s

Macroeconomic Trends during Liberalization

Liberalization of Exchange Controls and Exchange Rates

Liberalization of Arrangements for Private Companies

The Liberalization of Other Areas

Reasonable Principles for Liberalization

Notes

References

10. The Future of Incomes Policies

Introduction

Income Markets Are Imperfect

Incomes Policies Are Indispensable

Not To Be Restricted to Wages

Incomes from Professions; Residual Incomes

Social Productivity as a Possible Criterion

References

11. Urbanization and Income Distribution: The Case of Taiwan, 1966-1980

Introduction

A Classification of Sectors by Degrees of Urbanization

Income Disparities by Urbanization

Effects of Changes in the Sectoral Distribution on Changes in the Economy

Urbanization and the Standard of Living

Reasons for the Relatively Equitable Distribution

Conclusions

Notes

References

12. Reciprocal Trade Growth: The Latin American Integration Experience

Introduction

The Benefits of Economic Integration in a Two-Gap Model

The Evolution of the Latin American Free Trade Association

Implications

Notes

References

Part III Adjustment

13. Growth with Limited Supplies of Foreign Exchange: A Reappraisal of the Two-Gap Model

Introduction

Growth and Aid

Growth and Debt

Conclusions

Notes

References

14. Capital, Foreign Exchange, and Growth: The Two-Gap and Labor-Income-Floor Views

Introduction

The Simplified LIF and Two-Gap Models

The Impact of Aid on the Economy

Impacts of Aid in the LIF and Two-Gap Models: A Comparison

Conclusion

Notes

References

15. What Role Does Equity Play in the International Distribution of Development Aid?

Introduction

The Model

Functional Forms

Data

Basic Estimates with Neither Country-Specific Nor Period Effects

Extended Model Estimates with Country-Specific and Year-Specific Effects

Summary

Notes

References

16. Adjustment Policies and Development Strategies in Sub-Saharan Africa, 1973-1978

Introduction

Analyzing External Shocks and Adjustment Policies in Oil-Importing Sub-Saharan African Countries

The Balance-of-Payments Effects of External Shocks

The Balance-of-Payments Effects of the Policies Applied

Alternative Development Strategies: An Evaluation

Conclusions

Notes

References

17. The 1940s in Latin America

Introduction

External Shocks and Trends

Policies

Performance

The 1940s Legacy

References

18. Petrodollars and the Different Growth Performance of Industrial and Middle-Income Countries in the 1970s

Introduction

Production, Investment, and the Balance of Payment

Determining the Real Interest Rate in a Multicountry Model

The Different Response of Industrial and Middle-Income Countries

Comparative Empirical Evidence

Concluding Remarks

Notes

References

19. A Multisector Approach to Global Econometric Modeling, with Special Reference to Heavy Industries

Introduction

The Model

Empirical Results

Global Simulation of the U.S. Discount Rate Reduction

Concluding Remarks

Notes

References

Part IV Models

20. North-South Trade, Capital Flows, and Economic Growth: An Almost Neoclassical Model

Introduction

Key Assumptions: Single-Period Constraints

Intertemporal Relations

Numerical Assumptions

Reference Case Results

Alternative Rates of Capital Flows

Extensions and Suggestions for Additional Research

References

21. Equilibrium and Prices in Multisector Models

Introduction

Optimization and Market Equilibrium

Competitive Equilibrium Models

Model Specification and Empirical Solution

Prices in Planning Models

Macroeconomic Equilibrium

Conclusion

Notes

References

22. On the Uses and Abuses of Economywide Models in Development Policy Analysis

Introduction

CGEs as Static Models

Time and Money

Income Distribution

Some Possible Uses of CGEs

Consistent Plans

Concluding Discussion

Notes

References

23. Consequences of Changes in Subsidy Policy: The Egyptian Case

Introduction

The Magnitude and Distribution of Subsidies in Egypt

Microeconomic Theory and the Design of Tests of Changes in Subsidy Policy

Tests of the Consequences of Subsidy Adjustments

Conclusions

Notes

References

24. Macroeconomic Adjustment in a Computable General Equilibrium Model for India

Introduction

Real-Side Adjustment

Adjustment with Several Sectors

Money and Interest

The India Model (Jacobian)

Numerical Results: Investment Increase and Devaluation

The Role of Money

Further Observations

Notes

References

25. Active Life Profiles for Different Social Groups

Principles of Construction

The Background to the Development of Life Profiles

The International Research Program

Practical Problems

Preliminary Results

Index Number Construction

Research Possibilities

Costs and Benefits of Constructing Life Profiles

Notes

References

Appendix: Life Profiles and Transition Matrices in Organizing Sociodemographic Data (by Richard Stone)

26. "The Interdependence of Investment Decisions" Revisited

Introduction

Statement of the Mixed Integer Programming Model

A Criterion for Isolating Make-Buy Interdependence

Cost Implications of Neglecting Interdependence

Extensions and Limitations

Appendix: An Algorithm for Solution cum Problem Reduction

Notes

References

Index