Globalization and Development: Why East Asia Surged Ahead and Latin America Fell Behind

Topic: 
Globalization and Trade
Macroeconomics and Monetary Policy
Politics and Economy
Year: 
2013
Review by: 
Duke Center for International Development
Author(s): 
Anthony Elson
Publisher: 
Palgrave Macmillan
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This review is a summary of an interview Mr. Elson did on December 2013 about his book for the Duke Center for International Development.

     The book compares the experience of East Asia and Latin America since the mid-1970s to identify the key factors that have allowed East Asia to take advantage of a more globalized economy, while Latin America has not.

It is a companion book to his Governing Global Finance: The Evolution and Reform of the International Financial Architecture, which was published last year. This book focuses on the evolution of financial globalization and efforts to establish a system of global financial governance.

“In this second book, I focused much more intensively on the broad development of two regions and the factors that impeded economic growth in one against the factors that were encouraging economic growth in the other,” the author says.

Elson based these books on his many years as a senior staff member of the International Monetary Fund (IMF) and consultant with the World Bank. During his time with the IMF, he became intensively involved with financial assistance programs following economic crises in both regions. His experience allowed him to evaluate the underlying factors that caused the crises and observe how the regions recovered.

“East Asia, unlike Latin America, early on realized that development could only take place if a country became skilled and open to developing export potential,” he said. “By contrast, Latin America has always been heavily protectionistic. It’s only more recently that Latin America has been able to take advantage of the tremendous growth in international trade.”

However, Elson said, the issue cannot be evaluated from a purely economic perspective. Other factors, such as history and political systems, play a major role in explaining the different experiences of the two regions.

“Latin America carries a tremendous burden because of its colonial experience,” Elson said. “The institutions that were bestowed on Latin America ... made inequality endemic in the region because of patterns that privileged certain elite that had connections to the Spanish and Portuguese thrones. These institutions have taken a long time for Latin America to overcome.”

Corinne Krupp, associate professor of the practice of public policy at DCID, said Elson’s first-hand experience with the IMF and World Bank gives him valuable insights into the economic and financial policies of both regions, making the book compelling and accessible.

“This book will be of interest particularly to development practitioners and to students in economics, history, and public policy, but it deserves to be read much more widely as it yields valuable insights into the messy and unpredictable process of economic development,” she said.

In addition to serving as visiting lecturer at DCID, Elson is a professorial lecturer at the School for Advanced International Studies at Johns Hopkins University.

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