Developmental Macroeconomics

This book offers a Keynesian-structuralist approach to economics, focusing on demand, exchange rates, and growth strategies for middle-income nations.

In Developmental Macroeconomics, the author presents a fresh perspective on development economics and macroeconomics, specifically tailored for middle-income countries. This Keynesian-structuralist approach highlights the importance of demand as a driving force behind investment opportunities that are vital for economic progress. The book delves into the intricate relationships between short-term full employment, financial stability, and medium-term growth, providing a comprehensive framework for understanding these dynamics.

A central theme of Developmental Macroeconomics is the significant role of the exchange rate in shaping economic outcomes. While the exchange rate takes center stage, the book does not overlook other critical macroeconomic variables, such as interest rates, inflation rates, and profit rates. It introduces a set of concepts and models, culminating in a discussion of the cyclical overvaluation of the exchange rate often observed in developing nations. The author argues that this chronic overvaluation transforms the exchange rate from a mere short-term issue into a fundamental aspect of development economics, emphasizing the need for strategic management to maintain competitiveness at the industrial equilibrium level.

The conclusion of the book introduces the concept of new developmentalism, a national development strategy built upon the previously discussed models. This approach serves as an alternative to both traditional national-developmentalism and the liberal orthodoxy represented by the Washington Consensus, offering a promising pathway for economic growth and stability in developing countries.