Focus on what we say, not what we do
For years, the advanced economies have been lecturing poorer countries as to what they should do to develop their economies. Often called the “Washington Consensus”, we’ve been telling developing countries that they are poor because they engage in too many industrial policies such as high tariffs and subsidies. They need to liberalize, to move in a free market direction. Don’t be like Argentina, be like Singapore.
A recent article by Scott Lincicome points out that it’s now the advanced economies that are adopting these anti-growth policies:
I suppose you could argue that we’ve changed our minds about industrial policies. But we are still telling developing countries like China to reduce trade barriers and subsidies for manufacturers.
PS. This comment in The Economist caught my eye:
(0 COMMENTS)The Economist, using data from the Manifesto Project, a research group, examined the ratio of favourable to unfavourable discussions of free enterprise in the manifestos of political parties in 35 Western countries from 1975 to 2021, the most recent year available (see chart 1). We used a five-year-moving average and excluded parties that won less than 5% of the vote. In the 1990s deregulation, privatisation, unfettered trade and other policies that bring joy to the hearts of businessmen were praised almost twice as often as they were criticised. Now politicians are more likely to trash these ideas than celebrate them.