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Economic Reform and Economic Performance: Evidence from 20 Developing Countries


  • White, Howard
  • Leavy, Jennifer


Do adjustment policies assist or retard growth? This paper presents data on economic performance (aggregate and sectoral growth, inflation, investment and external account) for 20 countries. The data are classified on an annual basis according to the country’s policy stance in that year: controlled economy, partially or fully liberalised. This approach allows both control-group and before-versus-after analyses which are combined with a review of growth regressions and an analysis of case study material on adjustment. The evidence suggests three hypotheses. First, countries with controlled economies have performed badly compared with those which have moved towards greater market orientation. Second, economic performance does not differ greatly between fully-fledged market economies and partially liberalised ones: partly because several countries have pursued liberalisation with no improvement in performance. Third, given that there is little difference in manufacturing and agricultural growth between full and partial liberalisers yet overall growth is more rapid for the former, the additional growth must be in the service sector. These hypotheses suggest that the balance between state and market should be tilted more toward the state than is currently supported by international development agencies.

Suggested Citation

  • White, Howard & Leavy, Jennifer, 2000. "Economic Reform and Economic Performance: Evidence from 20 Developing Countries," MPRA Paper 6594, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:6594

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    References listed on IDEAS

    1. Robert Lensink & Howard White, 2000. "Assessing Aid: A Manifesto for Aid in the 21st Century?," Oxford Development Studies, Taylor & Francis Journals, vol. 28(1), pages 5-18.
    2. Pramila Krishnan & Tesfaye Gebre Selassie & Stefan Dercon, 1998. "The urban labour market during structural adjustment: Ethiopia 1990-1997," CSAE Working Paper Series 1998-09, Centre for the Study of African Economies, University of Oxford.
    3. Otani, Ichiro & Villanueva, Delano, 1990. "Long-term growth in developing countries and its determinants: An empirical analysis," World Development, Elsevier, vol. 18(6), pages 769-783, June.
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    Cited by:

    1. Vadlamannati, Krishna Chaitanya, 2008. "Do Choice & Speed Of Reforms Matter For Human Rights During Transition?," MPRA Paper 10141, University Library of Munich, Germany.
    2. Scrieciu, S. Serban, 2007. "Can economic causes of tropical deforestation be identified at a global level?," Ecological Economics, Elsevier, vol. 62(3-4), pages 603-612, May.
    3. Mofya-Mukuka, Rhoda & Abdulai, Awudu, 2013. "Effects of Policy Reforms on Price Transmission in Coffee Markets: Evidence from Zambia and Tanzania," Food Security Collaborative Working Papers 171870, Michigan State University, Department of Agricultural, Food, and Resource Economics.

    More about this item


    economic reform; economic peformance; structural adjustment; macroeconomic policy; inflation; growth; developing countries;

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity


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