Industrial Policy

In the 1990s, development policy advocated by international financial institutions was influenced by Washington Consensus thinking. This strategy, based largely on liberalization, privatization, and price-stability, down-played, if not disregarded, the role of government in economic planning. With the exception of the Far East, many developing countries adopted the view that industrial policy resulted in inefficiency and poor economic growth pervaded. Despite this negative perception, this prescription has been successfully employed in what are now some of the most vibrant emerging markets. This Task Force explores what industrial policies have been successful and the risks and trade-offs associated with these microeconomic approaches to growth and development.