Political Feasibility and Investment in Economic Transformations

July 1, 1993

Preview Citation

Format: Chicago

Peter Isard, and Joshua Aizenman. Political Feasibility and Investment in Economic Transformations, (USA: International Monetary Fund, 1993) accessed November 21, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

The paper characterizes the feasibility of economic transformation as requiring the simultaneous attainment of macroeconomic stability, political support, and adequate private investment. Macroeconomic stability is defined as fiscal balance; political feasibility is related to the income gains and losses of different population groups; and private investment is linked to public “infrastructure” investment. The analysis illustrates that attainment of the multiple requirements for successful transformation may necessitate a “big push” with external financial and technical assistance. It also emphasizes the importance of the productivity gains achieved when workers are induced to make occupational choices consistent with their comparative advantages.

Subject: Income, Infrastructure, Labor, Private investment, Public sector

Keywords: Consumer surplus, WP

Publication Details

Pages:

32
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 1993/057
Stock No:

WPIEA0571993
ISBN:

9781451967289
ISSN:

1018-5941

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