Political Economy of Structural Adjustment: A General Equilibirum- Interest Group Perspective

Abstract

Economic policy, policy reform and sustainability are viewed as a political- collective action process. The challenge is to provide incentives for collective action that yield an efficient allocation of a country's resources and to prevent the reemergence of the old policy regime once a crises is resolved. A modified Ricardo-Viner model with rent seeking households is used to provide insights into the factors that cause action to be misdirected, and into how policy reform might be induced and sustained. The analysis suggests the use of instruments that decrease the scope for rent seeking, provide resources - in the form of public goods - to the less influential, and compensatory payments to those disadvantaged by reform. Several recent IBRD and IMF country programs include these types of payments.

Cite this work

No public copy is stored for this record, so only the metadata is cited.

Stored only when both papers are in the corpus — 20 citations exist upstream.

Papers that cite the same references — the relational fallback while embeddings are still backfilling.