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2022 | OriginalPaper | Chapter

Africa Should Discard Mainstream Economic Theory

Author : John Komlos

Published in: The Palgrave Handbook of Africa’s Economic Sectors

Publisher: Springer International Publishing

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Abstract

Economists in developing countries should abandon the ideas enshrined in the Washington consensus, and resist teaching mainstream economic theory, because the idealized markets of mainstream economic theory differ greatly from real markets in ways that disadvantages those who are at the lower end of the global income distribution. The inconvenient truth is that real markets have numerous Achilles heels that prevent them working as described within the neoliberal framework. Real markets reduce the chances of those born into poverty to succeed in today’s complex global economy. These intrinsic imperfections, generally overlooked or trivialized by mainstream economists, are discussed in this essay. They include such factors as the costs associated with acquiring reliable information about market conditions, the myriad of problems associated with bounded rationality, manipulation of utility function of market participants.

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previous chapter Market Governance and Emerging Economies in Africa: A Dynamic Panel Analysis

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Title: Africa Should Discard Mainstream Economic Theory
Author: John Komlos
Publisher: Springer International Publishing
Book: The Palgrave Handbook of Africa’s Economic Sectors
Print ISBN: 978-3-030-75555-3

Electronic ISBN: 978-3-030-75556-0

Copyright Year: 2022
DOI: https://doi.org/10.1007/978-3-030-75556-0_39

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