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State, Economic Policy and Development

Abstract : The onset of the crisis for Keynesian-Fordist ideas in the developed world during the second half of the seventies - combined with the realization, at the same time, that the Soviet model of development in the Eastern bloc and the Third World had failed - led to the triumph, in the eighties, of what is called monetarist (or supply-side) economic theories. These theories take as their point of departure the notion that an upswing in economic activity depends not on stimulating demand, but on stimulating supply by means of a reduction of the charges which weigh on businesses. Monetarist theory favors a strict budgetary and monetary policy, coupled with the withdrawal of the State from the productive sphere, and the limitation of its role in industrial and social relations. In the event, the application of these venerable precepts of liberal orthodoxy did not bring about a lasting restoration of prosperity in the industrialized countries. Similarly, neither in the developing countries of the South, where they were put into practice in the eighties, nor in the countries of the former Eastern bloc, where they were applied in the nineties (usually on the recommendation of the IMF) did they result in a dynamic process of growth and development. Hence, from the end of the nineties onwards, we saw a renewed debate in both economic theory and economic policy about State intervention in the economy, and about the necessity (or otherwise) of government action to get back on the track of growth and development. The main ambition of the article is to discuss the role of the State, and of the economic policy, in the process of growth and development, in the industrialized countries as well as in the developing ones
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https://halshs.archives-ouvertes.fr/halshs-00751903
Contributor : Améziane Ferguene Connect in order to contact the contributor
Submitted on : Wednesday, November 14, 2012 - 2:49:01 PM
Last modification on : Saturday, June 25, 2022 - 7:59:58 PM

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Améziane Ferguene. State, Economic Policy and Development . Argumenta Oeconomica Cracoviensia, Cracow University of Economics Press, 2010, pp.13-32. ⟨halshs-00751903⟩

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