Structuralists, Structures, and Economic Development

The chapter provides an overview of the structuralist approaches to economic development. It starts with a review of the contributions of the early structuralists, distinguishing between the European-US strand and the Latin American strand. Next, it describes newer structuralist approaches, that is, formal structuralist macroeconomics, CEPAL neo-structuralism, new structuralism based on technology studies, new developmentalism, and new structural economics, and the closely related approaches of development traps. Following that, it examines the main theoretical ideas of the structuralists, distinguishing between three elements. First, it explains their organizing principles of analysis, which starts with structures of systems rather than with individual units. Second, it discusses how they view the world in terms of the structure of the global economy, structural differences between development and developing countries, and different structures of different developing economies. Third, it discusses the meanings they attach to economic development, emphasizing both growth and distribution. This is followed by a discussion of policies advocated by the structuralists who, in general, take into account the specific structuralist characteristics of particular countries rather than following a one-size-fits-all approach, recommend active state intervention in a flexible manner that promotes the synergy between the state, markets, and society, and address macroeconomic and sectoral issues in addition to microeconomic ones. In terms of specific policies for the contemporary world, it discusses: trade and industrial policies, especially those that seek to develop technological capability and technological upgrading by moving into new sectors; monetary, fiscal, financial and exchange rate policies that promote economic growth and external competitiveness, dampen cycles, and avoid instability; and policies specially aimed at reducing poverty and inequality. It concludes with brief comments on the strengths and possible problems of the approaches and how the latter can be overcome.