Globalization reigns supreme as a description of recent economic transformation-and it carries many meanings. In the policy realm, the orthodox terms of engagement have been enshrined in the "Washington consensus." But disappointing results in Latin America and transitional economies-plus the Asian financial crisis-have shaken the faith in Washington and elsewhere. One response has been to hark back to the more statist policies that the consensus marginalized. In this regard, Japan, Korea, and Taiwan are promoted as the poster nations that have derived great benefits from increasing integration with the international economy, without surrendering national autonomy in the economic or cultural spheres, effectively beating the West at its own game. The fundamental questions addressed in this monograph are whether industrial policy was indeed a major source of growth in these three economies, and if so, can it be replicated under current institutional arrangements, and if so, is it worth replicating, or, would developing countries today be better off embracing the suitably refined orthodoxy?

Compared to other regions of the world, the Middle East was once unique in its combination of authoritarianism and stultifying stability: No longer. Beginning in Tunisia, a wave of political upheaval has rolled across the region, reaching Egypt, Bahrain, Libya, and other countries caught between rising expectations and their antediluvian political systems, abetted by pan-Arab news channels and social networking media. This book examines the economics of the Middle East, with the aim of identifying changes to economic policy that could address at least the economic component of the challenges facing this part of the globe. The authors analyze the interaction of trade, productivity growth, and the political difficulties that may ensue as these countries move towards greater openness. Relevant comparisons are drawn from the experience of the transition economies and India on potentially successful policies and those likely to exacerbate existing problems.This new second edition contains a new introduction from Mohamed A. El-Erian and a new postscript.

The tragic events of September 11 and the subsequent war in Iraq have focused international attention on a nexus of problems involving economic underperformance, problematic internal politics, and the externalization of domestic dissent in the Muslim world. This book examines the economics of the Middle East, with the aim of identifying changes to economic policy that could address at least the economic component of the challenges facing this part of the globe. The authors analyze the interaction of trade, productivity growth, and the political difficulties that may ensue as these countries move towards greater openness. Relevant comparisons are drawn from the experience of the transition economies and India on potentially successful policies and those likely to exacerbate existing problems.