CPO 2001 Lecture Notes - Lecture 19: Four Asian Tigers, Classical Liberalism, Epidemiological Transition
Document Summary
Building institutions: more than just economic factors are important, markets require working political institutions a filly functioning state (legitimate) Two basic institutional spheres that are critical: state institutions: problems with corruption and rent-seeking, social institutions: high levels of social mistrust. Democratic institutions require a social consensus built on trust. Growth in trust and legitimacy requires public investment. Social institutions: people in divided societies resent unequal contributions, social mistrust hinders tax collection, makes investment cost prohibitive, protection of property rights, divided societies make enforcement difficult and inequality makes property rights unpopular. Possible solutions: start small, with reforms at local levels. Public investment in close-knit communities, rural development: national projects that mix ethnic groups together. Militaries, educational systems: direct support for civil society, development of independent newspapers and media, opposition political parties with a national base. State corruoption viewed as a central/critical weakness: central governments respond to special interests. Possible solutions: democracy (easier said than done!)