Streams

Lessons From the Developing World

Friday, April 26, 2013

Peter Blair Henry, dean of NYU's Stern School of Business and the author of  Turnaround: Third World Lessons for First World Growth  (Basic Books, 2013), says developed economies can learn a lot about economic reform from Third World experiences and should follow their own economic advice to developing economies.  Click here for a link to Ten points of D.C. Consensus.

 

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Comments [3]

Dan Welsh from Lewisboro, NY

I also lived in a developing country for a good number of years (same? - China) and generally "agree" with superf88. That is, development was controlled behind duties and trade barriers. In fact, the US climb to dominance was also critically supported by a customs regime. Mr Henry declared himself a believer in the global-trade-floats-all-boats myth. Tell that to nations that swapped out fully functional traditional cultures for "export oriented" wage slavery, or formerly middle class workers in the US. The primary beneficiary has been the folks who skim off the top of the global arbitrage in lives and jobs. We need to be able to sensibly adjust the playing field when necessary, and not be so hung up on ideological labels. Some of those adjustments must include duties which account for differences in wage levels and currencies, as well as environmental and labor standards. Instead, we are getting a stead diet of race-to-the-bottom trade agreements.

Apr. 26 2013 11:58 AM

Nonsense!
To get our economy going, cut our highest-corporate-taxes-in-the-world. The multinationals will then repatriate their most profitable aspects to the US, along with the profits, and the US will prosper. Effects will be seen in months.
Those used-to-be 3rd-world countries used to have higher taxes.
Most real job-training happens on the job. Government job training is a false panacea. If there are profitable jobs to be filled, then companies will hire & train.
The marginal federal corporate income tax rate on the highest income bracket of corporations (for 2011, USD 18,333,333 and above) is 35%. State and local governments may also impose income taxes ranging from less than 1% to 12%, the top marginal rates averaging approximately 7.5%. A corporation may deduct its state and local income tax expense when computing its federal taxable income, generally resulting in a net effective rate of approximately 40%. The effective rate may vary significantly depending on the locality in which a corporation conducts business.

Apr. 26 2013 11:58 AM

Living in a developing country myself for some years I picked up a few key lessons. 1. Put up protective walls against glforeign imports for as long as possible, to keep away competition. 2. Keep your currency de-linked from dollar or euro. The World s stock market crashing ? Not here it ain't! 3. Require $$ earned in country to stay there. We're developing, baby! 4. No tax breaks! You want our market? You like spreading your risk (like when your factory implodes?) buy your ticket . 5. Don't borrow money! Put on your sad face for roads and health care -- the world bank, IMF, Japanese, Canadians and swedes will cough up the bucks. 6. The foreigners think you are a "country" oriented toward "growth." Play along, and whatever you do -- DON'T LAUGH!

By following these rules you will both help your fellow villagers and buy that cinderblock mini hotel on mulberry st. You know you want.

Apr. 26 2013 10:53 AM

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