Question

1. Compare and contrast the neoliberal and neostatist theories' explanation of the divergence between developing regions and/or countries starting from the 1960s. Discuss the track record of the neoliberal development agenda giving examples from the developing world.

Answer 1

Neo liberal theories are those policies which are made to change the market situation such as elimination of the monitoring of price, reducing barriers in the trade, and loweing the control of state in the economy. Neo liberal policies are highly concerned on the economy which is driven by the market and to be self controlled in a virtual manner.

But the neo statist theories are more concerned to provide a feel of more control in an economy which can be merely controlled. The total development of an economy lies in between the key aspects of both of these theories.

The neo liberal ideolies are highly negative towards a political world. These policies states that individuals does things inorderbto meet their self interests and they work according to that. These policies thus states that inorder to increase the growth and wealth of economy, the individuals have to struggle in the point of total efficiency.

On the other hand, the neo statist theories are more concerned on the competitions which are largely monitored by the state. It actually means that if an developing economy have to compete with a developed economy, then the control or guiding measures have to be provided by the developmental state itself.

The neoliberal theories had made great achievements in the old industrial sectors of Britain and US inprior to the globalization. These policies had made great development in the western counties of Asia.But in the modern, these policies put forward by the washington agreements had went wrong in many parts of the modern world. Latin America is a great example for this failure of these policies.

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