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Development economics was my favorite subject in school, but I don't understand the field today. The Asian Tigers, especially China, with India have shown the way: development requires freer markets. It seems that all development economists would be shouting from the roof tops "Yes! That's how you do it!"

With freer markets, countries don't need much help developing, as Peter Bauer used to write. Without freer markets, nothing helps much.

The process which leads from freer markets to growth is not an instantaneous, smooth one with equal success. The Bloomington School, (at least the Elinor Ostrom I've read) is most famous for the focus on collective action problems that cannot be regulated through the price system. Common pool resources whose governance emerges out of the situation are the most obvious contribution (things like fishing rights, grazing rights, water distribution, or anything that is not excludable but still rivalrous.)

This is important for a reason you allude to: it shows economists who want to plan the economies of developing countries that the governance structures that emerge must come from the people, and cannot be imposed from without.

Fundamentalist,
I don't think it is as simple as you put it. For instance, some authors argue that, in the case of the Asian tigers, it was precisely the kind of planning they applied what made them success stories. (This is the kind of arguments should be addressed, which in some cases may be quite challenging. Ben Powell did precisely this). In analysing development case studies, as well as in other issues, we are always going to find very complex systems, with good stuff (freer markets and so on) and bad stuff (planning...). It may not be easy to distinguish what has been the cause for success or failure. If you consider this easy, it is not as easy if you have to persuade people with other ideological points of view...

Also, we know that free markets are the way towards development, but the question of how poor countries (without good institutions, e.g. free markets) can transit from the present situation to a better one (with freer markets) still remains.

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