Rethinking the State and Development: The Importance of Palliative Development

Abstract

Globalization has changed the models of development that are open to most states both in the industrialized and less industrialized world. The debt crisis of the last 30 years has challenged import substitution models that combined multinational penetration with substantial state investment in heavy industry. It was expected that globalization would produce either a triumph of effusive growth free market neoliberal reform (by writers on the right) — or a complete collapse of all forms of stateled growth (by writers on the left). The expectations of the Washington Consensus were dashed by the slow growth of employment in neoliberal reformers, and the experience of Asia post 1997 — where those nations who defied the IMF prospered, while those who followed the IMF stagnated. The expectations of the left that the role of the government and the nation-state in development would be eliminated were dashed by robust development and improvements of standards of living in China and elsewhere in East Asia despite extensive participation in the globalization process. The effects of globalization have been anything but uniform — and anything but predictable.