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Why do state approaches work into promoting development?
State planning and intervention is desirable due to the shortcomings of markets. The approaches range of state through planned economies by government setting outputs and prices.
Economic policy intends to protect domestic industry and encourage economic development through
• Heavy tariff barriers and a hostility to foreign direct investment to defend the home market for local firm’s for example
a. Limiting imports by quotas (limits onto the amount of imports permitted in a country)
b. High tariffs (taxes onto imports).
• High fixed swap over controls (high $/£) to create imports relatively inexpensive and exports relatively expensive
• State marketing boards purchase the output of tiny private sector farmers at well below world prices and utilize the foreign currency gain through profits to fund investment. There is low prices distort markets.
Does the work of the International Monetary Fund and World Bank overlap? Less developed countries turn to the: • International Monetary Fund to resolve debt repayment, exch
How does sectoral change enhance development? The Lewis Model argues economic growth needs structural change into the economy whereby surplus labour into traditional agricultu
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Make a list of businesses that provide goods and services that you or your family members use in a typical week. For instance, do you stop at the service station on your way to sch
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What are Rostowís policy implications? • LDCs (Less Developed Countries) require aid. The development procedure can stall at the Take Off stage for be short of savings. 15
What is the function of Non-Government Organisations, within the promotion of development? Advocates argue NGOs (Non-Government Organisations): • Hold DCs accountable for e
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