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A General Theory of Economic Development

Towards a Capitalist Manifesto

Sung-Hee Jwa

This book makes the bold attempt at proposing a new general theory of economic development. The main premise is that economic institutions and policies must embody ‘economic discrimination’ if there is to be any chance of real economic development. By economic discrimination, the author means ‘treating differences differently’ by selecting and supporting economic entities and behaviour that contribute positively to the economy. The book identifies markets, government and corporations as the ‘holy trinity of economic development’, that is, the three most important institutions that must work together via economic discrimination to steer the economy towards real transformative progress. The book also warns against the current trend of economic egalitarianism or ‘not treating differences differently’ because it destroys economic incentives and results in an array of economic problems including growth stagnation.
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Chapter 3: Critique of existing theories and a new beginning

Towards a Capitalist Manifesto

Sung-Hee Jwa

Extract

This chapter provides a critique of institution-free mainstream economics, including the important conditions such as private property rights and economic freedom. Despite the merits of private property rights and economic freedom for the efficient functioning of the market economy, the author provides reasons why these may not be sufficient for understanding economic development. The chapter also finds fault in the so-called Washington Consensus but looks favourably at New Institutional Economics as a new hope when looking at economic development. The purpose of this chapter is to show deficiencies in existing knowledge and tools for understanding economic development, and hence the need for a new approach

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