This paper studies the consequences of certain widespread policies for the quality and sustainability of growth. These policies cause economic inefficiency, environmental destruction and increased poverty. The paper develops a political economy model to show why the existence of such policies is...

For dozens of developing countries, the financial upheavals of the 1980s have set back economic development by a decade or more. Poverty in those countries has intensified as they struggle under the burden of an enormous external debt. In 1988, more than six years after the onset of the crisis,...