I have always found myself in a strange position in the development policy debates. I am uneasy with government led development efforts, and yet the Washington consensus reflected an admission that privatization, monetary responsibility, fiscal restraint, and free trade out performed the older Keynesian recipes for development.
What exactly went wrong in the 1990s will be a topic for many a doctoral dissertation. Did Russia run into problems because of too much free market policy? Certainly that conclusion would be one that would stretch the truth. Hard to say that monetary restraint was the policy rule when the ruble went from 180R = $1 to over 5000R = $1. As I wrote in an Op-Ed in the Orange County Register in January 1993, Shock Therapy in Russia failed Because It Lacked Voltage, not because Shock Therapy fails on its own terms.
Pablo Halkyard discusses the shift from the Washington Consensus to the Washington Confusion and links to Dani Rodrik's discussion of the World Bank's Economc Growth in the 1990s: Learning from a Decade of Reform.
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