| Abstract: | The article explores the question of appropriate development strategy for the so-called peripheral socialist countries using
Ethiopia as an example. Based on the economics of surplus and the nature of industrialization in late-socializing countries,
the Ethiopian regime's “surplus squeeze” strategy is critically examined. It is shown that such a strategy, whatever its short-term
goals, is detrimental to the long-term generation of sizable economic surplus and the provisioning of basic needs. It is then
argued that a viable alternative is the New Economic Policy (NEP) model of a mixed economy where the state, cooperative, and
private sectors grow side by side for a while on the basis of labor accumulation. NEP will eventually have to be phased out
as it exhausts its economic potential and threatens the goal of building a self-reliant, egalitarian society.
College of William and Mary |
