Libmonster ID: U.S.-1519
Author(s) of the publication: E. A. BRAGINA

Criticism and bibliography. Reviews

Ed. J. Braga de Macedo, Colm Foy and Ch.P. Oman. Paris, 2002. 289 p.*

The appearance of the book, prepared by the Center for Development Studies-within the framework of the Organization for Economic Cooperation and Development (OECD), is symptomatic. This is a kind of summary of the 40-year activity of the Development Center, founded in 1962, to which the second section of the book is devoted, rather, of an informative nature. But the main purpose of the reviewed work is an attempt to assess the previous ideas of development, so popular in the second half of the XX century, their various hypostases and refractions in the economic policy of a set of countries, which, thanks to the successful definition of A. Sauvy (1952), entered the scientific circulation under the name "Third World".

The book was prepared mainly by the staff of the Center, as well as well-known researchers of problems of developing countries who worked at the Center in different years, including E. Maddison, Y. Little and others. The original draft that formed the basis of the work was more accurately titled" Return to the Roots " (Development Redux), because, according to the authors, "looking back can help us move forward, reminding us of decisions that may have been forgotten" (p. 7). However, when publishing the book, the title of the book is not available. it was replaced by the current one, which, in my opinion, can be interpreted very broadly and ambiguously: "Reverse development", "Development returns", "A look at past development", etc.

The subject matter of the reviewed work is diverse and, apparently, largely reflects the personal scientific interests of the authors. These are the problems of globalization, the peculiarities of economic behavior of firms, civil society in the course of development, the tasks of the OECD in the XXI century, and a number of others. But the focus, as the authors repeatedly emphasize, is "Development with big D" in a world characterized by a dichotomy that is clearly marked in the title of one of the chapters and then repeated many times in the text - "The West and the Rest". However, the question arises to what extent does this correspond to the spirit of modern political correctness? Experience in the creation and development of the OECD, which represents-

* The OECD. Development Research Center. Development Returns, ed. by J. Braga de Macedo, Colm Foy, and Sh. Oman. Paris, 2002. 289 p.

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It is important for comparing the economic policies of different countries and their concrete results, especially in developed countries, and since the 1990s the number of countries in the South has increased. In the Development Center, along with the OECD member States, the participation of countries of the South (Argentina and Brazil since 1994, Chile since 1998, India since 2001) is expanding, which contributes to the discussion of opportunities for interaction between the two main groups of countries in order to overcome backwardness and convergence, primarily in the socio - economic sphere.

In line with this general direction is the fundamental study of E. Maddison, prepared by him during his work at the Center, on the results of world development in the second millennium. Its purpose is to show the dynamics of the position of various countries in the world economy during this period, marked by multidirectional trends in the pace and nature of economic growth. The data presented in this peer-reviewed book are based on Maddison's earlier calculations (widely used by other authors of the publication), which indicate that the gap in the level of per capita income (according to purchasing power parity) between the richest and poorest countries has increased by about 10 times since the beginning of the XIX century. Considering the West and the "rest of the world" (there are more than 180 of them) as two major economic subsystems in the global economic space, Maddison sees fundamental differences between them: The West is a relatively homogeneous group in terms of living standards, growth patterns, economic institutions, and governance models; the "rest" group shows signs of homogeneity, especially in terms of economic growth. at the regional level, although the differences between the countries of this subsystem remain very significant.

E. Maddison's observation that the process of divergence in the growth trajectories of individual countries intensified in 1990-2001 is relevant. In this regard, he focuses on the fact that the flow of foreign aid through official channels to the Third World was not as effective as the massive injections into post-war Western Europe under the Marshall Plan. With the exception of a small group of donors from the Nordic countries, "official development assistance" has not reached the 0.7% UN target, and it has clearly declined since the end of the cold war. In my opinion, the inefficient use of aid and its direct theft in many Third World countries also contributed to this. In contrast, private foreign investment in developing countries increased from $ 2.2 billion in the early 1960s to $ 300 billion in 1997. However, the gap in capitalization, especially in per capita terms, is between the West and the "rest" ($28 trillion versus $ 3,266, $ 1.3 trillion versus $ 248). accordingly) remains very significant. The most obvious qualitative difference is in the nature of investments. The bulk of these funds were " hot " money flowing into emerging markets in the expectation of risky income in a short time. As the Asian financial crisis of 1997 - 1998 showed, their instability and tendency to run away at the first signs of the crisis led to a rapid exsanguination of national economies.

E. Maddison dwells very briefly on the problems of the transition economy in Eastern Europe. (Contrary to expectations, this topic occupies a very limited place in the peer-reviewed book.) He believes that the transition to the market is difficult for them because of the low level of savings, worn-out infrastructure and the need to retrain the workforce. He is particularly pessimistic about the prospects of the former Soviet republics, and when he writes about their new economy, he even quotes the word "market", defining it as extremely inefficient. In this regard, we can also note the opinion of another author of the book, K. Barthelemy, that the introduction of "normal" market rules in economically backward countries is not enough for success, which can only be ensured by deep structural reforms, especially infrastructure development. I note that it is the weakness of institutions that acts as a real brake on economic transformation.

When discussing the almost obligatory problem of bridging the gap in basic socio-economic indicators between the West and the rest of the world, Cohen highlights the need to improve the quality of human resources. This is not a new approach, but rather a standard recommendation for developing countries that has been relevant since about the mid-1970s, after the appearance of I. Eidelman's work on the importance of social indicators of growth. Today, the primacy of the human factor in development is an indisputable sign of the times, and this publication confirms this.

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I note, however, that despite the importance of developing education, there is a real danger of another "flux" of economic policy in the distribution of limited budget resources. As the experience of the countries of the South has shown, there is no main and even more so determining factor in the system of measures that promote development - it is the result of a synergistic environment. Many Third World countries that have made significant positive changes in education have found that the results of expanding education systems have not always been in line with the interests of the national economy. The outflow of qualified personnel who are not used in their own country has become a powerful fuel for the economies of developed countries.

And one more thing that the authors of the book pay attention to when evaluating the results of investments in education. Its receipt in Third World countries is associated with an increase in claims for employment in state structures. For example, in the 1990s, 37% of the non-agricultural labor force in Tropical Africa was employed in this sector, compared with 33% in North Africa, 15% in East Asia, 19% in Latin America and 20% in the OECD countries.

Attempts to assess the impact of globalization on solving development problems are also typical for research in recent decades. The approach to globalization as a wave-like process is characteristic of Sh. Oman, which believes that in the nineteenth century, globalization led to the concentration of industry in a group of developed countries that used comparative advantages, leaving the South to produce agricultural products, thereby depriving it of the benefits of industrialization. After gaining political independence, they tried to imitate a protectionist development strategy based on the experience of Western countries, but its results "turned out to be less productive in the twentieth century" (p.54). Only a few countries, including Japan and South Korea, have managed to find a balance between protecting the domestic market and expanding exports. Sh. Oman also believes that during the third wave of globalization in the last 100 years between 1980 and 1990, the coordination of the policies of multinational corporations (TNCs; the book uses the abbreviation MNC) in the development of the global economy has increased. relations with developing countries, which has led to a reduction in the latter's ability to seek favorable conditions in attracting capital and technology. Whether this can be considered a result of globalization remains an open question. I note that the latter expands and diversifies the opportunities for economic contacts, including for "others". However, the response of countries to the challenges of globalization varies, which is primarily determined by the level of their socio-economic development and the adaptability of the economic system.

We agree with the position of D. Cohen, who emphasizes that as a result of the impact of globalization, the deindustrialization of the North and at the same time the industrialization of the South are accelerating. But he rightly doubts the ability of globalization to become a factor of convergence of both groups of countries, primarily in the economic sphere, which is fundamentally important for assessing the prospects for the global economy as a whole.

Globalization and, consequently, the country's participation in this process are directly related to the openness of the economy at the national level. The book treats the category of openness as the exchange of ideas, technologies, and factors of production, while trade in finished industrial goods is only a marginally important part of openness. In this regard, the paper again emphasizes the relevance of the quality of local human resources, since, according to A. Kruger, "closed economies are unable to effectively use their human capital" (p. 55).

When it comes to the failures of past development strategies, in particular the growing gap between major groups of countries in the global economy, researchers invariably turn to African countries, trying to understand the reasons for the continent's growing lag, especially in the Tropical Africa region. The OECD Development Center has also repeatedly analyzed this problem. Based on his 2001 study "Developing Africa", K. Bertelemi states that economic growth on this continent after 1960 was extensive and, with the exception of Botswana, was unstable, short-term. Among the reasons for this situation are the instability of the financial system, the distrust of potential depositors in existing banks and other credit institutions, the lack or lack of legal norms protecting property rights. Referring to the Senegalese experience, Berthelemy acknowledges that the Government's attempts to improve the banking sector by liberalizing it in the 1990s were not successful, as was the case in other countries.

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the policy of creating state-owned enterprises in the 1970s. The conclusion is both logical and unoriginal: Africa needs deep structural reforms to ensure the creation of a diversified economy on an endogenous basis.

Such recommendations, as always, run into the same question - how to implement them? In addition, the implementation of reforms, among other things, takes a long time, and the situation in a number of countries on the continent requires immediate measures, including overcoming mass poverty, combating the epidemics of AIDS, tuberculosis, and malaria.

The peer-reviewed book is yet another confirmation that the problems of economically backward countries have not only not been solved in the last 50 years, but have also become significantly more complex. This is primarily due to changes in the world economy, which had only a limited impact on the course of industrialization in the XVII - XIX centuries in Western countries compared to the powerful external influence that national economies are now exposed to. Differences in the initial conditions largely negatively affected the attempts of Third World countries to implement a catch-up (imitation) model of industrialization. The effect of the demonstration effect significantly increased, which in turn accelerated the growth of social tension. There was an objective need to look for solutions to environmental problems (it is significant that in most "other" countries, in the conditions of the most severe environmental crisis, the motto "development first, ecology second"became widespread). The problem of mass poverty in the countries of the South, which was previously considered an inevitable companion of development, has become politically acute. Nor was privatisation, with all its attendant problems (workers ' resistance to reduced employment and at the same time the reluctance of some of the influential upper echelons of the state apparatus to change economic relations that were beneficial to them), on the agenda either.

According to the authors, industrialization in the Third World countries since the middle of the XX century has appeared in two main guises. Following J. Little, they believe that the growth of "on credit" (widespread attraction of borrowed funds from outside), which took place during import substitution without a corresponding expansion of exports, led to the financial crisis of 1982. In search of a way out, most Third World countries have adopted the IMF's structural adjustment programs in order to obtain new external loans. Trade liberalisation, as a mandatory part of them, was finally consolidated during the Uruguay Round (1986-1994).

If import substitution, according to the authors of the book, clearly worsened the economic situation of the country, then export orientation, depending on its conditions, can, as they believe, have either a positive or negative effect. Strictly speaking, this is such a common position that it was hardly worth going back to it again. It is more productive to try to link the impact of protectionism in the course of import substitution with the expansion of poverty. A survey of 20 developing countries showed that economic inequality and poverty are increasing as protectionism increases (the income share of the poorest, at 60%, has fallen by another 5%). The impact of an export-oriented strategy is more complex: foreign trade liberalization can increase the number of jobs for the poor by 20 to 45%, while at the same time complicating the economic situation in food-importing countries due to rising food prices. Despite this controversy, the Uruguay Round was "a turning point in favour of globalisation in developing countries" (p.103), suggesting greater openness in their economies.

These conclusions are not new, but M. Bussolo and K. Morrison use them to justify the feasibility of further liberalization of the economies of lagging countries. The reference to India, where small-scale farmers benefited from higher prices for sugar and livestock products, is not entirely correct, since growth in the agricultural sector has been unstable. No less peculiar is the growing factor of China in the world market, for example, the export of its textile products. At the WTO meeting in Cancun (2003), developing countries opposed the reduction of tariff duties on imports of industrial products due to the inability to compete with cheap Chinese goods produced with sustained state support. As a result, Chinese clothing is sold on the markets of other developing countries 60% below the world average prices [Izvestia, 15.09.2003].

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The combination of global coverage of the analysis with illustrations for individual countries (I would like to have more of them, since this gives the study a specific character) objectively led the authors to assess regionalization and interaction in the globalism-regionalism system. I note that this is a new direction in the study of qualitative changes in the global economy as a whole, and the first place in it is given to the features of the economic behavior of firms, which, according to Sh. Oman, have become the driving force behind globalization. This was accompanied by the spread of the post-Taylorist system of industrial organization, which he calls "lean, lean", meaning higher efficiency, or "flexible specialization", which is well known from modern small business research (p. 118). The system involves splitting operations and transferring some of them to the countries (regions) that are most profitable in terms of using local factors of production - capital, labor, and natural resources. Hence the new regionalism-the desire of firms to develop production networks based on the largest regions (Asia, the Americas, Greater Europe, including Central and Eastern Europe, perhaps even North Africa), i.e., the development of industrial networks. use all the advantages of multi-million-dollar sales markets, which are also geographically close.

Fukasaku dates the new regionalism to the 1990s, when, in his opinion, the number of agreements concluded between developing countries with a focus on developing export ties increased dramatically. Another typical feature of the new regionalism is the coordinated adoption of political decisions by the participants of such associations, including the recognition of human rights, democracy, and the rule of law. However, the same problem is emerging again - "the insufficient capacity of many poor countries to actively participate in multilateral trade negotiations and effectively implement the terms of global trade" (p. 164).

This kind of regionalism based on microeconomic forces (firms are active agents at the micro level) not only promotes globalization, but also strengthens the competitive position of" flexible " post-taylorist firms. This, according to Sh. Oman, solves two problems: a) reduce resistance to necessary changes from local influential groups whose interests are often affected; b) strengthen political stability and confidence in order to attract long-term productive corporate investment. It is obvious that we are talking primarily about TNCs, which changed the attitude in developing countries in the early 1980s due to the growing need for external funds. "What developing countries needed most was investment. Many saw the financial component of the traditional foreign direct investment package as particularly important" (p. 117).

According to Sh. Oman, the difficulties of attracting foreign investment have increased since the mid-1980s, as state and provincial governments in countries with federal administrative structures have become active agents competing in this market along with central governments. The pressure of local firms, which are in dire need of additional resources, has increased, including as a result of increasing globalization and the desire to bring their products to the foreign market. We can assume that this formulation of the problem reflects the increasing need for external resources, primarily due to the need to strengthen the competitiveness of manufactured goods. It is significant that the author notes "rapid growth of both foreign and domestic investment in the export industries of developing countries focused on serving consumers in the OECD countries" (p. 117). He refers to the conclusions of a number of researchers who see a new division of labor emerging in this process. It is hardly possible to accept this opinion unconditionally, since the growth, and most importantly, diversification, of exports of consumer goods by developing countries to the countries of the North (West) is characteristic of the second half of the XX century.

The problem of correlation between the development and formation of civil society deserves attention, but I. McDonnell and N. Lecotte consider it, as it seems, somewhat simplistically. They focus on non-governmental organizations( NGOs), which they believe are becoming part of the broader concept of "global civil society" (p.189). They recognize that the term itself is very broad and is often perceived as synonymous with charitable, voluntary and non-profit organizations. The data presented in this book show an extremely uneven distribution of NGOs in the world. In fact it is an analog of inequality in the world economy: 20% of European non-governmental organizations-

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organizations mobilize 90.5% of all financial and 95% of human resources in this sector (p. 193). The merit and at the same time the main direction of their activity in the XX century was the desire to humanize the policy of official structures, including through direct intervention in its formation. From 1970 to 1985, development assistance through international NGOs increased 10-fold and accounted for 5% of all development assistance, rising to 15% in 2001. The authors believe that since the mid-1990s, the importance of non-governmental organizations as active participants in the development process has increased: "They have felt themselves part of a broader non-governmental and non-profit movement, designated as anti-globalism, whose ambitions and potential impact extend far beyond humanitarian aid and development cooperation" (p.199).

The authors of the chapter with the rather familiar title "The Challenge of Development" are J. Braga, K. Foy, and Sh. Oman, in my opinion, is clearly confused by the discrepancy between what was expected at the beginning of the independent development path of the countries of the South and reality. "Reliance on market institutions and liberal democracy did not necessarily lead to prosperity" (p.211). At the same time, referring to the experience of East and South-East Asian countries, the authors note that their authoritarian governments are often unable to win the trust of the business sector.

This may have increased interest in the role of institutions in developing economies, and the desire to understand the impact of formal institutions (legislation, constitution, contractual agreements) and informal ones (traditional values and norms) on the country's development. Collectively, they "determine the opportunities for economic and political activism in society" (p. 212). Since the authors ' focus is primarily on the institutional system in the South, they found it necessary to emphasize that "informal institutions (culture, norms of behavior, customs) are embedded or deeply rooted in society, while institutional changes remain marginal, slow, and relatively weak compared to political or legal decisions, which are mostly implemented in the South." They are able to encourage significant institutional change" (p. 213). Assessing the difficulties experienced by many developing countries in the socio-economic sphere, and the inefficiency of the organizational structures created there, which are copied from their Western counterparts, the authors draw an important conclusion: "When such decisions or actions create new tension between formal and informal institutions, the latter tend to strengthen, while changes in the former only slow down" (p. 213). This position to a certain extent answers the question of why the values of modernization, especially in the sphere of production, are instilled in economically backward societies with such difficulty, and consumer stereotypes are mastered extremely quickly, increasing the negative impact of the demonstration effect.

The authors highly assess the role of the OECD, considering the experience of this organization as a kind of measure of development, since its members "created a new culture of political interdependence and mutual respect" (p.219). But, apparently, the entire previous period of independence of the Third World countries, with their numerous experiments in the economic field, led the authors to the conclusion that" each national development strategy has its own specifics and the European experience in this context cannot be mastered " (p.220). P. develops this position. Yankowitz. He believes that after the end of the cold war, the world is dominated by one economic and political system, which allows the West to occupy a dominant position in it. "These new and encouraging developments in the global structure have failed to reverse, or at least to reduce, existing as well as new inequalities and imbalances" (p.277). I will quote his fundamental conclusion in full, since it largely reflects the general mood of the book: "Neither the 1990s nor the beginning of the new millennium produced other, more effective economic development strategies that could replace rigid development policies and theories that did not affect current trends" (p.277).

V. Velaskeikis ' conclusions, summarized under the title "Development with a capital letter", do not please with new statements of the problem, although everything he said is reasonable and reflects the real picture of the world at the beginning of the third millennium. This includes globalization, insecurity in a world in which the United States acts as the sole superpower, but is unable or unwilling to shoulder the burden of global governance, and the expansion of the global economy.-

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In his opinion, there are clusters of poverty in the North and islands of conspicuous wealth in the South. All this is well known.

V. Velaskeikis admits that all the models that were once recognized as successful, one after another fall into the dustbin of history. "Whereas in 1962 a developing country could choose from a set of about a dozen variants, including Western capitalism and various Third-world socialist experiments, today almost all of these models have collapsed" (p.282). But perhaps to end the book on a more optimistic note, he puts forward the idea of a collective and synergistic strategy in the face of increasing globalization: "We all develop together" (p.285). Of course, we are all together, since the Great Geographical Discoveries of the 15th century, and we participate in the formation of the world economy together, but the results are very different.

After evaluating the experience, observation, erudition of the authors, and the relevance of a number of their proposed recommendations, you still come to the disappointing conclusion that further development will proceed by trial and error. As a result, not all participants in this difficult and long journey will achieve the desired goals - a high standard of living, a strong position in the global economy. But another thing is also clear: the movement in this direction is mainly achieved through the mobilization of internal resources. External factors may accelerate or slow down the development of the national economy, but they should not be decisive.


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