Rodrik, Dani2017-08-172017-08-172009https://hdl.handle.net/10986/27937How 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 the author manage the following tension. On the one hand, global macro stability requires that we prevent external imbalances from getting too large. On the other hand, growth in poor nations requires that the world economy be able to absorb a rapid increase in the supply of tradable produced in the developing world. It is possible to render these two requirements compatible, but doing so requires greater use of explicit industrial policies in developing countries, which have the potential of encouraging of modern tradable activities without spilling over into trade surpluses. The 'price' to be paid for greater discipline on real exchange rates and external imbalances is greater use (and permissiveness) towards industrial polices.en-USCC BY 3.0 IGOABSOLUTE VALUEADVANCED COUNTRIESADVANCED ECONOMIESADVERSE EFFECTSAGENCY PROBLEMSAGRICULTUREALLOCATIVE EFFICIENCYANNUAL GROWTHANNUAL GROWTH RATEASSETSBILATERAL TRADEBILLBINDING CONSTRAINTCAPITAL FLOWSCAPITAL INFLOWCAPITAL INFLOWSCAPITAL MOBILITYCAPITAL OUTFLOWSCHLORINECLIMATE CHANGECOMMODITYCOMMODITY PRICESCOMPARATIVE ADVANTAGECOMPARATIVE ADVANTAGESCONDITIONALITYCONSUMERSCONTRACT ENFORCEMENTCOST OF CAPITALCOUNTRY CASECOUNTRY DUMMIESCOUNTRY FIXED EFFECTSCROSS COUNTRYCURRENCYCURRENT ACCOUNTCURRENT ACCOUNT BALANCESCURRENT ACCOUNT DEFICITSCURRENT ACCOUNT IMBALANCESCURRENT ACCOUNT SURPLUSESDEFICITSDEPENDENT VARIABLEDEPRECIATIONDEVELOPED COUNTRIESDEVELOPED WORLDDEVELOPING COUNTRIESDEVELOPING COUNTRYDEVELOPING ECONOMIESDEVELOPING WORLDDEVELOPMENT PRACTITIONERSDIVERSIFICATIONDOMESTIC CONSUMPTIONDOMESTIC DEMANDDOMESTIC SAVINGDUAL ECONOMYDUTCH DISEASEECONOMIC ACTIVITIESECONOMIC ACTIVITYECONOMIC DEVELOPMENTECONOMIC GROWTHECONOMIC HISTORYECONOMIC PERFORMANCEECONOMIC RELATIONSECONOMIC RESEARCHECONOMICSEMISSIONSENDOGENOUS VARIABLESENVIRONMENTALENVIRONMENTAL BENEFITSEQUILIBRIUMESTIMATED COEFFICIENTESTIMATED COEFFICIENTSEXCESS SUPPLYEXPENDITURE FUNCTIONEXPENDITURESEXPORT PERFORMANCEEXPORT PROCESSING ZONESEXPORT VOLUMESEXPORTERSEXPORTSEXTERNAL BALANCEEXTERNAL DEFICITSEXTERNAL FINANCEEXTERNAL IMBALANCESEXTERNAL TRADEEXTERNALITIESFACTOR ENDOWMENTSFINANCIAL CRISESFINANCIAL CRISISFINANCIAL LIBERALIZATIONFINANCIAL MARKETSFINANCIAL STABILITYFISCAL DEFICITSFISCAL POLICIESFISCAL POLICYFIXED EFFECTSFOREIGN CAPITALFOREIGN COMPANIESGDPGDP PER CAPITAGENERAL EQUILIBRIUMGLOBAL MACROGLOBAL RISKGLOBALIZATIONGOLDGOLD STANDARDGREENHOUSE GASESGROWTH PERFORMANCEGROWTH POTENTIALGROWTH PROCESSGROWTH PROSPECTSGROWTH RATEGROWTH RATESGROWTH THEORYHIGH GROWTHIMBALANCESIMPORTIMPORT BARRIERSIMPORT DEMANDIMPORTSINCENTIVE EFFECTSINCOMEINCOME LEVELSINCOME SHAREINCOMESINCREASE GROWTHINDUSTRIAL POLICYINDUSTRIAL SECTORINDUSTRIALIZATIONINDUSTRIALIZATION STRATEGYINDUSTRIALIZED COUNTRIESINSTITUTIONAL ENVIRONMENTINTERMEDIATE INPUTSINTERNATIONAL TRADEINVESTMENT DEMANDINVESTMENT LEVELSJOB CREATIONLABOR MARKETSLOCAL CONTENTLOCAL CURRENCYMACRO STABILITYMACROECONOMIC POLICIESMACROECONOMIC POLICYMACROECONOMIC STABILITYMARKET EQUILIBRIUMMARKET FAILURESMARKET FORCESMONETARY POLICYNATURAL RESOURCESNEOCLASSICAL GROWTH MODELNET CAPITALNEW PRODUCTSOPEN CAPITAL ACCOUNTSOUTPUTPANEL REGRESSIONSPER CAPITA GROWTHPOLICY CHANGESPOLICY ENVIRONMENTPOLICY MAKERSPOLICY OPTIONSPOLITICAL ECONOMYPOOR COUNTRIESPOSTWAR PERIODPOVERTY REDUCTIONPRICE INCREASESPRIMARY COMMODITIESPRIMARY PRODUCTSPRIVATE SAVINGPRODUCERSPRODUCTIVITYPRODUCTIVITY INCREASESPROFITABILITYPROPERTY RIGHTSPUBLIC FINANCEPUBLIC POLICYRAPID ECONOMIC GROWTHRAPID LIBERALIZATIONRATE OF GROWTHREAL EXCHANGE RATEREAL EXCHANGE RATE APPRECIATIONREAL EXCHANGE RATESREAL INCOMERED TAPERELATIVE PRICERELATIVE PRICESRICH COUNTRIESRISK SHARINGSCATTER PLOTSSIGNIFICANT EFFECTSLOW GROWTHSLOWDOWNSTANDARD DEVIATIONSTRUCTURAL CHANGESUPPLY RESPONSESUPPLY SIDETAXTAX REVENUETECHNOLOGICAL ADVANCETERMS OF TRADETRADABLE GOODTRADABLE GOODSTRADABLE SECTORSTRADE BALANCETRADE DEFICITTRADE DEFICITSTRADE LIBERALIZATIONTRADE POLICIESTRADE PROTECTIONTRADE SURPLUSTRADE SURPLUSESUNCERTAINTIESUNDERVALUATIONVALUE ADDEDWAGESWEALTHWORLD DEVELOPMENT INDICATORSWORLD ECONOMYWORLD MARKETWORLD MARKETSWORLD TRADEWORLD TRADE ORGANIZATIONWTOWorking PaperWorld Bankhttps://doi.org/10.1596/27937