Unlike what is commonly believed, the last two decades have not witnessed the twilight of industrial policy. Instead, incentives and subsidies have been refocused on exports and direct foreign investment, in the belief that these activities are the source of significant positive spillovers. The...

South Africa has undergone a remarkable transformation since its democratic transition in 1994, but economic growth and employment generation have been disappointing. Most worryingly, unemployment is currently among the highest in the world. While the proximate cause of high unemployment is that...

We consider a model of policy choice in which appropriate policies depend on a country’s own circumstances, but the presence of a successful leader generates an informational externality and results in too little ‘policy experimentation’. Corrupt governments are reined in while honest...

Unlike most cross-country growth analyses, we focus on turning points in growth performance. We look for instances of rapid acceleration in economic growth that are sustained for at least eight years and identify more than 80 such episodes since the 1950s. Growth accelerations tend to be...

How hospitable will the global environment be for economic growth in the developing world as we come out of the present financial crisis? The answer depends on how well we manage the following tension. On the one hand, global macro stability requires that we prevent external imbalances from...

Much more than comparative advantage and free markets have been at play in shaping China's export success. Government policies have helped nurture domestic capabilities in consumer electronics and other advanced areas that would most likely not have developed in their absence. As a result, China...

Africa’s recent growth performance has raised expectations of a bright economic future for the continent after decades of decline. Yet there is a genuine question about whether Africa’s growth can be sustained, and if so, at what level. The balance of the evidence suggests caution on the...

Do countries with lower policy-induced barriers to international trade grow faster, once other relevant country characteristics are controlled for? There exists a large empirical literature providing an affirmative answer to this question. We argue that methodological problems with the empirical...

This is an attempt to derive broad, strategic lessons from the diverse experience with economic growth in last 50 years. The paper revolves around two key arguments. One is that neo-classical economic analysis is a lot more flexible than its practitioners in the policy domain have generally...

The World Bank's The East Asian Miracle: Economic Growth and Public Policy makes official what East Asian specialists had long known: most of the high-performing Asian economies have had extensive government intervention, and some of these interventions, in the areas of credit and exports, have...