Credit expansion and development – A Schumpeterian and Keynesian view of the Chinese miracle

Herr, Hansjörg

doi:10.4337/ejeep.2010.01.08

Cited by 4 publications

(3 citation statements)

References 15 publications

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“…South Korea or Taiwan developed under a regime of strict capital controls, including highly regulated domestic financial markets, which delivered long-term credits and kept real interest rates low (Stiglitz/Uy 1996;Dullien 2009). China, after the start of reforms in 1978, to give another example, was able to establish a largely state-controlled creditinvestment-income process protected by strict capital outflow and inflow controls (Herr 2010). FDI can under certain conditions support development; other types of capital flows can create serious problems for development.…”

Section: Discussionmentioning

confidence: 99%

Underdevelopment and unregulated markets: why free markets do not lead to catching-up*

Herr

2018

European Journal of Economics and Economic Policies: Intervention

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After World War II, only a few developing countries were able to catch up to the real GDP per capita levels prevailing in developed countries. These successful countries in almost all cases were in Asia and did not follow the free-market doctrine in the tradition of the Washington Consensus. There must be theoretical explanations as to why underdevelopment is reproduced and most countries in the world do not catch up. This essay reviews different economic approaches that attempt to explain the lack of convergence. The aim is to explain why neither trade based on comparative advantages, nor on economies of scale, nor in global value chains, can cure the lack of sufficient productivity development. The essay will also cover special features like negative terms-of-trade effects, abundance of scarce resources, and premature de-industrialisation. Also distorted financial systems, high inequality, and restrictions on macroeconomic demand management are briefly discussed. As most developing countries suffer from several of these factors, this approach can explain why development is only possible with the support of comprehensive regulatory government policies and a change in global governance.

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Section: Discussionmentioning

confidence: 99%

Underdevelopment and unregulated markets: why free markets do not lead to catching-up*

Herr

2018

European Journal of Economics and Economic Policies: Intervention

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“…From this, relationship follows the desideratum that the nominal wage level should increase according to trend productivity, plus a low (target) inflation rate. In this case, the medium-term inflation rate remains at a low level (Herr, 2009;Keynes, 1930). Wage increases in all sectors should take the medium-term national productivity development as a guideline to limit wage dispersion between sectors.…”

Section: Wage Discipline and Managed Exchange Rate As Nominal Anchorsmentioning

confidence: 99%

“…However, a credit and investment expansion based on increasing currency mismatch is not sustainable. It becomes understandable that the countries which managed to achieve a certain convergence, like China and other Asian countries earlier, developed under a regime of strict capital controls, including highly regulated domestic financial markets (Herr, 2010; Stiglitz & Uy, 1996).…”

Section: Theoretical Explanation For Insufficient Convergencementioning

confidence: 99%

Insufficient Economic Convergence in the World Economy: How Do Economists Explain Why Too Many Countries Do Not Catch-up?

Herr

Ruoff

2018

Agrarian South: Journal of Political Economy: A triannual Journ

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This essay reviews different economic perspectives on the development of productivity and living standards in developing countries. It shows that neoclassical approaches to the problem of economic convergence fail to provide a satisfactory explanation of why economic convergence does not take place. In doing so, it reviews seven heterodox arguments on why developing countries do not converge. The article argues that the lack of economic convergence is a result of market forces which lead to the reproduction of underdevelopment. Therefore, comprehensive state interventions are needed to overcome underdevelopment. The article discusses different alternative policies which are needed to trigger development, thus countering the perspectives of neoliberal economists and the Washington Consensus.

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Comparing National and Industry-Specific Trajectories of Economic and Social Upgrading as Well as Various Strategic Solutions

Dünhaupt

Herr

Mehl

et al. 2022

Economic and Social Upgrading in Global Value Chains

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Credit expansion and development – A Schumpeterian and Keynesian view of the Chinese miracle

Abstract: In neoclassical thinking, insuffi cient development is

Cited by 4 publications

References 15 publications

Underdevelopment and unregulated markets: why free markets do not lead to catching-up*

Underdevelopment and unregulated markets: why free markets do not lead to catching-up*

Insufficient Economic Convergence in the World Economy: How Do Economists Explain Why Too Many Countries Do Not Catch-up?

Comparing National and Industry-Specific Trajectories of Economic and Social Upgrading as Well as Various Strategic Solutions

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