A critique of bourgeois theories of economic development

Festival expenditures amount to over 15 per cent of a household's annual expenditures in rural India. Yet they have never been studied by economists. This article uses both qualitative and quantitative data from a case study of three South Indian villages to show that festivals are important public goods in the village, but neither a pure entertainment motive nor an altruistic desire to contribute to a public event seems to explain their size. Households which spend money on festivals, everything else held equal, are able, however, to generate tangible rewards - lower prices on food, higher social status and more invitations to meals from other families. This indicates that active participation in festivals generates private economic and social returns which help resolve a potential free-rider problem. The evidence is consistent with the notion that festivals serve as mechanisms by which communities build social networks.     

Transportation infrastructure and regional economic development in China

This study examines the trend of transportation investment and analyzes the effect of transportation investment on regional economic development in China. Results from cross-section analysis indicate that those provinces that have invested more in transportation infrastructure tend to have greater output.     

The logic and pathologies of local and regional economic development strategies

State and local economic development programs are often loaded with tax incentive and promises of deregulation designed to attract new businesses, encourage expansions, and cultivate new firms. There is little evidence that tax relief and deregulation are effective tools for economic development, however. This article examines the logic of public sector participation in economic development, questions the effectives of typical development policies, and suggests alternatives, including tax-base sharing, greater regional cooperation, and human capital development.     

Tariffs and economic development: A comment

The optimality criteria of linear programming transportation and spatial equilibrium models never ‘explain ‘ real world flow patterns. This paper provides reasons for the difference between an optimal solution and real world patterns. Data for the linear programming exercises are derived from the four stages of a rice marketing system in Sri Lanka at a time when the state had monopoly control over distribution. The examination of factors more important than transport costs in explaining residual flows sheds some light on policy and institutional problems associated with monopoly procurement.

Substantively, a comparison of the optimal solution with reality shows a fairly high degree of transportation efficiency throughout the system, except at the last stage, where rice changes hands between two parastatal orginisations (the Paddy Marketing Board and the Food Commission) to be distributed to final destinations. Inefficient store locations rather than commodity allocations generate the greatest waste of transport. Reasons for the difference between programming solutions and reality include uncertainty, congestion, policies and institutional structure conducive to a deterioration in quality of the commodity handled, problematic regional preferences for rice type, inadequate communications, unpredictable timing of rice imports and corruption.     

Political incentives and transaction costs of collaboration among US cities for economic development

This study extends research on Institutional Collective Action by testing a transaction cost explanation for self-organising economic development agreements between US cities. We offer a unique contribution to this literature by identifying how these agreements between cities with similar political institutions mitigate the transaction costs of collaboration, and how characteristics of these agreements combine with political institutions to shape collective action. The results of an empirical analysis of data collected through a survey of local officials suggest the alignment of high-powered political incentives between cities mitigates the coordination and division problems of forming a joint venture. Agreements that enable elected officials to distribute the benefits of an agreement are also found to moderate this effect.     

An assessment of native American economic development: Putting culture and sovereignty back in the models

Economic indicators in the United States document the poor economic straits in which Native Americans find themselves. Historically, scholars have explained delayed economic development using Linear Stage, Structural-Change, Dependency and Neoclassical Counter Revolution Models. All of these, however, are unable to fully explain the Native American case. We discuss the deficiencies of these models and point out the effects of constantly changing United States policies on Native American economic well-being. We present data from a survey of tribal government respondents about preferred business arrangements on the reservation to support greater attention to cultural identity in economic development studies. A model that incorporates cultural and sovereignty variables is presented. Diane Duffy, Ph.D., is assistant professor of political science at Iowa State University. She combines the study of political psychology and public policy by examining citizen perceptions of political issues. Currently she is examining Native American perceptions of “patriotism.” Jerry Stubben, Ph.D., is an Extension State Communities Specialist and adjunct associate professor in the Professional Studies Department at Iowa State University. He descends from the Ponca Tribe of Nebraska and served as Chair of the American Indian Studies Program at ISU from 1990–1995. Presently, he serves as co-investigator on a National Institute on Drug Abuse funded project to develop, implement, and evaluate a tribally based, family oriented substance abuse prevention program on the Mille Lacs reservation in Minnesota and Lac du Flambeau reservation in Wisconsin.     

The sources of European Union legitimacy: Political theories old and new

David Beetham and Christopher Lord, Legitimacy and the European Union (Longman, Harlow, 1998), 144 pp., ISBN 0–582–30489‐X (pb)

Thomas Banchoff and Mitchell P. Smith (eds), Legitimacy and the European Union: the Contested Polity (Routledge, London, 1999), 225 pp., ISBN 0–415–18189–5 (pb)

Albert Weale and Michael Nentwich (eds), Political Theory and the European Union: Legitimacy, Constitutional Choice and Citizenship (Routledge/ECPR Studies in European Political Science, London, 1998), 205 pp., ISBN 0–415–17313–2 (hb)     

The adequacy of income: A social dimension in economic development

The adequacy of income of a household may be defined as the ratio of its income to the income level required to achieve the conventional standard of living in the socio‐economic group to which the household belongs. This concept has greater relevance than that of income for the study of consumer behaviour (e.g. propensity to save) and other social behaviour and pathologies. Income and need for income in a country do not necessarily rise proportionately over time, thus resulting in periods of declining, as well as periods of rising, income adequacy. Furthermore, in spite of the international demonstration effect, the need for income in developing countries is significantly lower than in developed countries resulting in a much smaller gap between income adequacies than between incomes.     

Democracy and economic development

This discussion explains why democracy as is generally understood may not be suitable to meet the challenges of a developing economy and how democratic institutions generally fail to respond to the immediate demands of a population impatient to raise its level of living. It defines the terms economic development and democracy, reviews some theoretical models of democracy which have been proposed in economic theory, proposes an approach to the process of economic development, and considers problems of development. Economic development is a process which calls for huge investments in personnel and material. Such investment programs imply cuts in current consumption that would be painful at the low levels of living that exist in almost all developing societies. Governments need to resort to strong measures, and they must enforce them vigorously in order to marshal the surpluses required for investment. If such measures were put to a popular vote, they would certainly be defeated. Mainstream economic theory assumes the virtues of a market system and the decisions arrived at by the interaction of market forces. This is the economic equivalent of democracy. Yet, mainstream economic theory devotes little attention to the conditions under which a market system generates a just solution. The democratic developing countries have all inherited a class society, with a highly skewed distribution of income. The wealthy minority often seeks to preserve its privileged position and to enjoy the benefits of development. It even seeks the help of the judiciary to preserve the sanctity of private property and to assure that its patterns of conspicuous consumption can continue. This is done in the name of democratic rights. Many developing societies are burdened with outmoded traditions and value systems that are incompatible with the production relations of the new society they hope to achieve. The international exchange of resources is believed by some to be an attempt to control the pace and character of development so that the economic colonization will survive. To end such unfavorable conditions for development, 3rd world governments must demand greater sacrifices from their citizens, and this cannot be achieved by normal democratic means. Recent events in several developing nations illustrate this point.     

Contending eurocentric theories: the case study of Thailand's economic regionalism in ASEA

ABSTRACT

The Eurocentric theory of economic regionalism, as demonstrated by the empirical case of the European Union, has been widely recognized as the pathfinder, role model, and inspiration for other regional organizations, including ASEAN, due to its continuous attempts at deepening economic integration, formalizing the decision-making process, and legalizing the administrative body. Despite this concordant movement, it is evident from Thailand that ASEAN has evolved differently from the rationale, process, and prediction that Eurocentric theory dictates.

The purpose of this article is to argue that the economic regionalism of ASEAN has not developed in accordance with an economically-oriented rationale. Moreover, the process of economic integration has not necessarily derived from the free trade agreement itself, particularly when a country lacks continuity in terms of its development of regionalist projects. In addition, Thailand has not followed the path of economic integration due to spillover effects. This is because member countries have not given up their sovereignty in favour of the regional institution. Economic regional activities have been broadened within a limited scope, and the expansion has been conducted through bilateral talks, rather than a strengthening of regional solidarity.     

Financial development and economic growth: Additional evidence

This note suggests that, contrary to the conclusions reached in several recent studies, the empirical evidence does not support the view that financial development promotes economic growth. It is first noted that the predominant pattern in the data for 95 individual countries is that of a negligible or weakly negative covariation between financial development and growth of real GDP per capita. Second, the individual‐country correlational picture is a sharp contrast to the correlations based on crosscountry data that have been used in most research on the subject. Third, individual‐country estimates of a basic multiple‐regression growth model also do not indicate a positive association between financial development and growth. Fourth, in cross‐country data and models of the kind that have been used in most studies, when the regression structure is permitted to vary across three subgroups, a huge parametric heterogeneity is observed, and the overall indication is that of a negligible or negative association between financial development and growth.     

Political and economic motivations for labor control: A comparison of Ireland, Puerto Rico, and Singapore

The global economy imposes many constraints on small economies, especially those pursuing export-oriented industrialization (EOI) through the attraction of foreign direct investment. It has been argued that the success of EOI depends on the government’s ability to meet the labor requirements of this economic model—labor peace and low wages—through labor control policies and even repression. This article compares the histories of labor control in Ireland, Puerto Rico, and Singapore, three island-nations of similarly small size and high degree of integration with the global economy. While the pressures for labor control during EOI are evident in each case, there is a great deal of variation in the strategies governments adopted to rein in organized labor. I argue that the labor control methods employed during EOI are not explained by an economic logic but by a political one inherited from an earlier period when labor control was motivated by the efforts of a dominant party to consolidate its power.     

The state and economic development

In this article it is argued that one must distinguish between the arbitrary, short-run power of the state and the long-run, infrastructural power of the state. Game theory concepts are used to illustrate these ideas and successful development is linked to the infrastructural power of the state. The evolution of the latter is related to culture/ideology and this is given operational meeting within the context of simple game theory. The historical experience of Japan is utilized to illustrate these ideas. Dr. Richard Grabowski is a professor of economics at Southern Illinois University-Carbondale. His research interests include the role of the developmental state in economic development. His work has appeared inWorld Development, Journal of Developing Areas, Economic Development and Cultural Change.     

A mid-level methodology for evaluating economic development projects

This article describes the key elements of a computerized spreadsheet model that can be used by public officials and agency staff to assess in advance the likely economic and fiscal effects of economic development projects. While the model in its current state is based on Chicago, local data can be used to adapt it to other places. The project is innovative in its use of current economic theory, data, and tools to create a model useable on a routine basis by non-specialist public agency staff. The aim is to narrow the gap between academic economic analysis and public sector practice. A key element of the model is that it was developed in close cooperation with staff of the Chicago Department of Planning and Development and combines rigorous economic analysis with the political priorities and choices of public agency staff. Also, the model includes key data about the local economy and standard industry data, but can be overridden by an

analyst if project-specific information is available.