Organized
by:
International Development Economics Associates (IDEAs)
http://www.networkideas.org
Supported by: The United Nations Development
Programme (UNDP)
Venue: Quality Inn MGM Beach Resorts, 1/74
East Coast Road, Muttukadu, Kanchipuram District, Tamil Nadu 603112, India
(near Chennai).
IDEAs organised a workshop
on "Macro Economic Constraints and Policy Alternatives in Developing
Countries"
at
Muttukadu, Chennai, India from 23rd
January to 26th
January, 2006. The workshop was based on a heterodox perspective consisting
of a series of lectures followed by open discussions on the impact of
international trade and financial liberalization on macroeconomic policies
at country levels, especially in the developing world. The lectures included
both theoretical as well as empirical analyses of the resultant situations
in developing economies and explored alternative future policy paradigms
for resolving macroeconomic crises posed by the forces of liberalization.
The programme covered impact on specific sectors and used case studies
to illustrate and analyse the current scenario.
The workshop venue had
over 30 trainees (either completed their PhD or at the verge of completing
it) from South Asia, Africa, Latin America and South East
Asia. The participants were provided full funding for travel along with
complete boarding and lodging to attend the workshop. While screening
the applicants, special emphasis was given to those from the low income
developing countries and they were also given preferential treatment with
regard to funds. The total work time of the workshop was 24 hours
over a period of four days.
The trainees were given
lectures with discussion on the following topics:
- Macroeconomic Implications
of Global Imbalance by
Professor C.P. Chandrasekhar,
Jawaharlal Nehru University, New Delhi.
- Macroeconomic Analysis
when Holding Gains are Properly Identified by Dr.
Alex Izurieta,
Research Fellow, Cambridge Endowment for Research in Finance, Judge
Business School, University of Cambridge, London.
-
International
Economic Integration and Employment Patterns by
Professor Jayati Ghosh,
Jawaharlal Nehru University, New Delhi.
- Managing International
Capital Flows by
Dr. Yilmaz Akyuz,
former Director of Division on Globalization and Development Strategies,
UNCTAD.
- Determinants of
Neo-liberal Financial Globalization by
Professor
Erinc
Yeldan,
Department of Economics, Bilkent University, Turkey.
- Some Contradictions
in the World Economy by
Professor Prabhat Patnaik,
Jawaharlal Nehru University, New Delhi.
- Economic Reforms
in China by Cui Zhiyuan, School of Public Policy and Management, Tsinghua
University, Beijing.
- Changes in the Distribution of Income over the Last Two Decades:extent, sources and possible causes by Professor Giovanni Andrea Cornia, University of Florence, Florence.
Professor C.P. Chandrasekhar lectured on
the high current account deficit faced by the United States for the last
one and a half decade and the serious implications it had has on the global
macroeconomic imbalances. He concluded that the specific trade-related
factors cannot explain either the magnitude of the U.S. current account
imbalance or its recent sharp rise. Rather, the U.S. trade balance has
been passively determined by foreign and domestic incomes, asset prices,
interest rates, and exchange rates, which are themselves the products
of more fundamental driving forces. Dr. Alex Izurieta also showed great
concern for the high US Current account deficit. He argued that the present
US economy relies largely on large capital inflows, but the concentration
of investment in the highest-income regions of the world is socially damaging,
destabilizing and prejudicial to the effective development of resources
in the world as a whole. He concluded that the US deficit can be contained
in a less damaging manner only if the rest of the world contains its own
surpluses and boosts investment in other regions. A couple of things in
his lecture attracted the trainees: a) the introduction of the concept
of holding gains and b) the running of iteration programmes to explain
how simple they were.
Professor Jayati Ghosh gave a very stimulating
lecture on the aspect of trade not being able to generate employment in
the economy. Her lecture was a perfect blend of immense empirical research
and profound theoretical concepts. She brought some gender perspectives
into the macroeconomic issues arguing that women continue to be disproportionately
engaged in low-wage, low-productivity and part-time jobs. Professor
Yilmaz Akyuz took up quite a different topic in his lecture regarding
management of capital inflows, especially arguing the serious effects
that capital inflows have on the developing world. He emphasized that
in the current political environment, the maximal feasible strategy for
developing countries in their search for greater financial stability would
be to try to combine national control over capital flows with some internationally-agreed
arrangements for debt standstills and lending into arrears, while strengthening
their financial systems through better standards, and effective prudential
regulations and supervision.
Professor E. Yeldan spoke about the changing
global scenario with the aggressive infiltration of the ideas of neo-liberal
economics, which led to an undermining of the development through state
interventions. He drew an alternative policy framework as elements of
a more socially relevant programme, where he emphasised that domestic
development objectives have to be elevated over the strategic interests
of finance capital. Professor Prabhat Patnaik strengthened the ideas on
the concern over the US current account deficit, previously put forward
by Prof. C.P. Chandrasekhar and Dr. Alex Izurieta,
and also provided a sound theoretical analysis of the issue. His lecture
became quite intersting and special in a way that his arguments were based
on the historical and political events of the globe and the effects it
has on the development prospects of the third world.
The lecture of Professor Chui Zhuiyan anchored
around the development process of China and provided a detailed case-study
of the Chinese economy. The lecture even provided a comparative study
of the Indo-Chinese economy, which in the recent period has drawn a lot
of attention in the media, as well as the academia. He enlightened the
trainees when he proposed a new concept of Beijing Consensus, in opposition
to the Washington consensus, based on innovation (or experiment), equity
and asymmetric defense strategy. In Professor A.G.
Cornia's lecture, he elaborately discussed the significance of
inequality in the global economy and empirically established the fact
that especially in the policy regime of liberalization and globalization,
this inequality tends to rise across and within the borders. This discussion
assumed huge importance since, in the recent periods, policy makers neglect
inequality as a policy issue.
In an effort to improve its future performances, IDEAs requested the participants
to fill up a questionnaire (feedback forms), which detailed the performance
of each lecturer and in the end to provide some valuable suggestions.
In their response, some participants suggested that a greater stress on
differences in the development experiences of the different countries,
for instance a greater stress on the unfolding of the development process
in Africa as distinct from that of Asia would have been more useful. It
was felt that Africa was somewhat under represented in the discussions
and country studies. Overall, the participants were quite satisfied with
the way the workshop was unfolded and agreed that it was a good learning
experience for them.