Polterovich, Victor and Popov, Vladimir (2005): Appropriate Economic Policies at Different Stages of Development.
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This paper summarizes theoretical arguments and provides empirical evidence to support the statement that rational economic policies depend qualitatively on two factors – technological and institutional level of development of a country. We concentrate on the impact of three policies to promote the catch up development – import tariffs, increase of government revenues/spending, and the speed of foreign exchange reserves accumulation ("exchange rate protectionism"). It is shown that the impact of these policies may be positive or negative dependening on a stage of development; in each case we find threshold levels or critical combinations of GDP per capita and/or an institutional quality indicator.
A theoretical model demonstrates how tariff protection and accumulation of reserves can boost long term growth in the presence of externalities.
|Item Type:||MPRA Paper|
|Original Title:||Appropriate Economic Policies at Different Stages of Development|
|Keywords:||development stages; economic growth|
|Subjects:||P - Economic Systems > P1 - Capitalist Systems > P16 - Political Economy|
|Depositing User:||Victor Polterovich|
|Date Deposited:||18. Jan 2010 10:47|
|Last Modified:||15. Feb 2013 21:50|
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