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Self-Discovery in a Development Strategy for El Salvador

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  • Ricardo Hausmann

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  • Dani Rodrik

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Abstract

We study the causes of low growth in El Salvador, a country with an impressive record of political, macroeconomic, and structural reform. We apply a growth diagnostic methodology and conclude that market failures in the process of self-discovering" the country´s productive potential is a main obstacle to investment and growth. We propose a set of policies to tackle this constraint."

Suggested Citation

  • Ricardo Hausmann & Dani Rodrik, 2005. "Self-Discovery in a Development Strategy for El Salvador," ECONOMIA JOURNAL OF THE LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION, ECONOMIA JOURNAL OF THE LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION, vol. 0(Fall 2005), pages 43-101, August.
  • Handle: RePEc:col:000425:008659
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    References listed on IDEAS

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    1. Richard H. Adams, Jr. & John Page, 2003. "International migration, remittances, and poverty in developing countries," Policy Research Working Paper Series 3179, The World Bank.
    2. Alejandra Cox Edwards & Manuelita Ureta, 2003. "International Migration, Remittances, and Schooling: Evidence from El Salvador," NBER Working Papers 9766, National Bureau of Economic Research, Inc.
    3. Mckenzie, David & Rapoport, Hillel, 2007. "Network effects and the dynamics of migration and inequality: Theory and evidence from Mexico," Journal of Development Economics, Elsevier, pages 1-24.
    4. Rapoport, Hillel & Docquier, Frederic, 2006. "The Economics of Migrants' Remittances," Handbook on the Economics of Giving, Reciprocity and Altruism, Elsevier.
    5. Edwards, Alejandra Cox & Ureta, Manuelita, 2003. "International migration, remittances, and schooling: evidence from El Salvador," Journal of Development Economics, Elsevier, vol. 72(2), pages 429-461, December.
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    Cited by:

    1. Pablo López & Luis Rosado, 2013. "¿Qué puede aprender Latinoamérica del auge de las TIC en el Asia Pacífico?," REVISTA DE ECONOMÍA DEL CARIBE 014731, UNIVERSIDAD DEL NORTE.
    2. Matthew Doyle, 2010. "Informational externalities, strategic delay, and optimal investment subsidies," Canadian Journal of Economics, Canadian Economics Association, vol. 43(3), pages 941-966, August.
    3. Robert J. Utz, 2007. "Sustaining and Sharing Economic Growth in Tanzania : Contents of CD Rom," World Bank Publications, The World Bank, number 6894.
    4. Samuel W. Malone, 2011. "Sovereign indebtedness, default, and gambling for redemption," Oxford Economic Papers, Oxford University Press, vol. 63(2), pages 331-354, April.
    5. Alexander Kleibrink & Philippe Laredo & Stefan Philipp, 2017. "Promoting innovation in transition countries: A trajectory for smart specialisation," JRC Working Papers JRC106260, Joint Research Centre (Seville site).
    6. ., 2013. "Explaining Success and Failure in Economic Development," Chapters,in: World Economic Performance, chapter 9, pages 227-267 Edward Elgar Publishing.
    7. Khan Shahrukh Rafi, 2011. "Growth Diagnostics: The Puzzle of Pakistan's Lagging Economic Growth," Global Economy Journal, De Gruyter, vol. 11(4), pages 1-19, December.
    8. Sufrauj, Shamnaaz & Schiavo, Stefano & Riccaboni, Massimo, 2014. "The Structure and Growth of World Trade, and the Role of Europe in the Global Economy," MPRA Paper 54122, University Library of Munich, Germany.
    9. Shamnaaz Sufrauj & Stefano Schiavo & Massimo Riccaboni, 2015. "Big hits, export concentration and volatility," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 32(2), pages 135-166, August.
    10. World Bank, 2007. "Tanzania - Sustaining and Sharing Economic Growth : Country Economic Memorandum and Poverty Assessment, Volume 1. Main Report," World Bank Other Operational Studies 7703, The World Bank.
    11. Fernando Ferrari-filho & Anthony Spanakos, 2008. "Why Brazil has not grown: a comparative analysis of Brazilian and Chinese economic management," ENSAYOS DE ECONOMÍA 008063, UNIVERSIDAD NACIONAL DE COLOMBIA SEDE MEDELLIN.
    12. Theodore H. Moran, 2014. "Foreign Investment and Supply Chains in Emerging Markets: Recurring Problems and Demonstrated Solutions," Working Paper Series WP14-12, Peterson Institute for International Economics.
    13. Ghani, Ejaz & O'Connell, Stephen D., 2014. "Can service be a growth escalator in low-income countries ?," Policy Research Working Paper Series 6971, The World Bank.
    14. Jérome VALETTE, 2016. "Do migrants transfer productive knowledge back to their origin countries?," Working Papers 201622, CERDI.
    15. Theodore H Moran, 2016. "The Role of Industrial Policy as a Development Tool: New Evidence from the Globalization of Trade-and-Investment," Working Papers id:8423, eSocialSciences.
    16. Ricardo Hausmann & Bailey Klinger & Rodrigo Wagner, 2008. "Doing Growth Diagnostics in Practice: A 'Mindbook'," CID Working Papers 177, Center for International Development at Harvard University.
    17. Dragan TEVDOVSKI & Vladimir FILIPOVSKI & Igor IVANOVSKI, 2014. "A Diagnostics Approach To Economic Growth In Small Open Economies: The Case Of The Republic Of Macedonia," Review of Economic and Business Studies, Alexandru Ioan Cuza University, Faculty of Economics and Business Administration, issue 13, pages 47-68, June.
    18. Jérome Valette, 2017. "Do migrants transfer productive knowledge back to their origin countries?," Working Papers halshs-01425451, HAL.
    19. Acevedo, Carlos Gerardo & Cabrera, Maynor, 2012. "Social Policies or Private Solidarity? The Equalizing Role of Migration and Remittances in El Salvador," WIDER Working Paper Series 013, World Institute for Development Economic Research (UNU-WIDER).
    20. World Bank, 2012. "Better Jobs in Central America : The Role of Human Capital," World Bank Other Operational Studies 11924, The World Bank.

    More about this item

    Keywords

    Self-Discovery; growth metodology; public policy; El Savador;

    JEL classification:

    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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