| Abstract: |
Four years after the onset of the world debt crisis, the issueis how to restore growth. The answer is structural adjustment,both macro and micro. At the macro level, adjustments have tobe made to the structure of aggregate demand and supply to restoregrowth while generating the needed trade surpluses. This meansprimarily real exchange rates that are maintained at appropriatelevels and an emphasis on investment. At the micro level, itis argued that most developing countries need to liberalizetrade, allow the price system to operate, develop financialsystems, reform taxes, and improve the efficiency of publicenterprises, perhaps by selling them. The article discussesthe nature of these two types of reforms and the policy andresearch issues relevant to World Bank analysis of growth programs. |
