Why have the economies of some developing countries fallen back
while others have advanced? Why have so many stabilization and
structural adjustment programs failed to deliver growth dividends?
This book shows that there is a common and valid answer: political
credibility defined as the predictability of the institutional
rules of the game. This case is not only argued theoretically but
also found to be confirmed by empirical analysis. Ten case studies
pitting Latin American countries against Southeast Asian ones
reveal the sources of political credibility. Economic openness is
the necessary precondition, long-term reputation or democratic
participation the sufficient one. Despite the seemingly superior
strength of authoritarian reputation democratic control is the more
successful road.
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