Sunday, February 20, 2005

"Cambridge don challenges conventional wisdom on "Good" Policies and Institutions"

UNU/INTECH Seminar Highlights:

"You could write a history of development economics by looking at the succession of catch-phrases that have captured the reigning orthodoxies of the day. If you did, there is little doubt that the current chapter would be entitled 'Good Governance.' For the past ten years, the international policy-advice establishment centred on the World Bank and the International Monetary Fund has promoted the notion that no economic strategy can succeed as long as poor countries are governed by ineffective and corrupt bureaucracies, managing inadequate and outmoded institutions.

"If good governance - and its corollary, good institutions - are the centrepieces of the current development orthodoxy, Dr. Ha-Joon Chang must be counted as its heretic-in-chief. For the past two years, this Cambridge economics professor has led an iconoclastic push against the received wisdom. 'Good governance,' Dr. Chang says, 'should be seen as one of the effects of development rather than as one of the causes.' "

This position would seem to challenge the central theme of my paper, "The Institutional Divide: Is The Digital Divide a Symptom or a Cause?" In that paper I argued that institutional development is perhaps more important than bridging the digital divide. However, more basically, I argued that institutions are developing and that ICT innovation would both be demanded by the institutional development and would help propel that development.

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