New structural economics: the third generation of development economics
Asian Education and Development Studies
ISSN: 2046-3162
Article publication date: 13 December 2019
Issue publication date: 9 July 2020
Abstract
Purpose
Development economics is a new sub-discipline in modern economics. The first generation of development economics is structuralism. The second generation of development economics is neoliberalism. Most developing countries followed the above two generations of development economics and failed to achieve industrialization and modernization. The purpose of this paper is to introduce the third generation of development economics, called new structural economics, which advises governments in developing countries to play a facilitating role in the development of industries in a market economy according to the country’s comparative advantages. The paper also discusses how the government may use industrial policies to play this facilitating role and some new theoretical insights from new structural economics.
Design/methodology/approach
The paper draws on the experiences of success and failure in developing countries to generate new understanding about the nature and causes of economic development in developing countries.
Findings
The structuralism failed because it ignored the endogeneity of economic structure in a country. The neoliberalism failed because it neglected the endogeneity of distortions in the transition economies.
Originality/value
The paper proposes new policy and theoretical framework for developing countries.
Keywords
Acknowledgements
The author is indebted to helpful comments and suggestions by Professors Lok Sang HO and Alex WONG. The paper is prepared for Asian Education and Development Studies. The research benefits from the support of Social Science Foundation Project No. 13&ZD014.
This article forms part of a special section “China’s development strategy”, guest edited by Lok Sang Ho.
Citation
Lin, J.Y. (2020), "New structural economics: the third generation of development economics", Asian Education and Development Studies, Vol. 9 No. 3, pp. 279-286. https://doi.org/10.1108/AEDS-02-2019-0039
Publisher
:Emerald Publishing Limited
Copyright © 2019, Emerald Publishing Limited