Structural interdependence and policy coordination, Public Economics

Assignment Help:

The structural interdependence, in fact, forms the basis for the policy maker's choice behaviour for policy or policy mixes. The spectrum formed by various policy mixes depends on the levels of coordination between agents. Paul Rosenstein-Rodan declared as early as in 1943, that economic development could be thought as massive coordination failure, in which several investments do not occur simply because other complementary investments are not made, and there latter investments are not forthcoming simply because the former are missing. Thus we may conceive two Equilibria under the very same conditions, one based on positive expectations in one sector due to realizations of various policy outcomes in other sectors and other involving frustration and persistent stagnation in which frustration due to negative policy outcome in one sector spill over to the other sector.

This serves as potential explanation why similar policy instruments in similar economics behave differently and give rise to different or dissimilar policy outcomes. It, in fact, depends on the nature of belief and expectations held by agents in different sectors concerning the actions of each other.


Related Discussions:- Structural interdependence and policy coordination

OPTIMAL COMMODITY, State ramsey rule of optimal commodity taxation and the ...

State ramsey rule of optimal commodity taxation and the intuition for it

Comparison of gdp, Normal 0 false false false EN-IN X...

Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInternetExplorer4

Summary of natural resource economics, Normal 0 false false ...

Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInternetExplorer4

Healthcare Ecpnomics, Suppose a given demand curve for massage therapy serv...

Suppose a given demand curve for massage therapy services. In the context of giving massage therapy services, list, and explain in detail, 5 different variables that may cause an i

Pigouvian tax, Normal 0 false false false EN-IN X-NON...

Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInternetExplorer4

Current system of national income accounts, Normal 0 false fa...

Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInternetExplorer4

Dissipative systems transform energy, Our economic systems are of this type...

Our economic systems are of this type and share for general properties. a) Dissipative systems transform energy and process information to maintain a state of organization that

Discuss basic features of international policy coordination, Discuss the ba...

Discuss the basic features of international policy coordination. There may be two sources of interdependence between national economic policies, club goods and horizontal spill

Private & public goods, what do you understand by private & public goods. D...

what do you understand by private & public goods. Distinguish between private and public goods.

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd