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Fiscal Policy: Fiscal Policy in a Developing Country

  • John H. Adler
Part of the International Economic Association Series book series (IEA)

Abstract

The bibliographical note appended to the last chapter in W. A. Lewis’ The Theory of Economic Growth ends with the following sentence: ‘There is regrettably very little theoretical discussion of the fiscal problems of underdeveloped countries’.2 There is ample reason for this deficiency, which has not disappeared since Lewis’ book was first published. The fiscal system and the fiscal policy of any country reflect its citizens’ general economic views and aspirations, which it may have in common with other countries, or may be peculiar to it; but they also are the result of the country’s social and cultural institutions, its resource endowment, the structure of its economy, the distribution of income, and the seat of political power, in a configuration which is inevitably unique. Any general discussion of fiscal problems is thus bound to be of limited usefulness since just below the surface of the broadest generalizations lurks a multitude of specific exceptions to the general rules. Nevertheless, some principles of fiscal policy which are pertinent to low income countries endeavouring to advance economically at a faster pace than in the past may be derived from observation and speculation.

Keywords

Fiscal Policy Public Expenditure Government Expenditure Money Supply Government Revenue 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Notes

  1. 2.
    W. A. Lewis, The Theory of Economic Growth (London, Allen and Unwin, 1955), p. 419.Google Scholar
  2. 1.
    Cf. A. M. Martin and W. A. Lewis, ‘Patterns of Public Revenue and Expenditure’, in The Manchester School of Economic and Social Studies, vol. xxiv, September 1956, pp. 203–44.CrossRefGoogle Scholar
  3. A. R. Prest and I. G. Stewart, The National Income of Nigeria, Colonial Research Studies, No. 11 (London, H.M. Stationery Office, 1953), p. 83.Google Scholar
  4. 2.
    The partial substitution of an expenditure tax and a net worth tax for the personal income tax, which were advocated by N. Kaldor in Indian Tax Reform, Report of a Survey (New Delhi, Ministry of Finance, 1956)Google Scholar
  5. and An Expenditure Tax (London, Allen and Unwin), 1955Google Scholar
  6. 2.
    H. Wald, The Taxation of Agricultural Land in Underdeveloped Economies (Cambridge, Harvard University Press, 1959), passim.CrossRefGoogle Scholar
  7. Cf. H. C. Wallich and J. H. Adler, Public Finance in a Developing Country — El Salvador, a Case Study (Cambridge, Harvard University Press, 1951), p. 132.CrossRefGoogle Scholar
  8. J. H. Adler, E. R. Schlesinger, E. O. Olson, Public Finance and Development in Guatemala (Stanford, Stanford University Press, 1952), p. 138.Google Scholar
  9. Cf. E. R. Schlesinger, Multiple Exchange Rates and Economic Development (Princeton : Princeton University Press, 1952), particularly p. 20.Google Scholar
  10. 2.
    For a more extensive treatment of export taxes, cf. J. H. Adler, ‘The Economic Development of Nigeria : Comment’, in The Journal of Political Economy, vol. 44 (October 1956), pp. 425–34CrossRefGoogle Scholar
  11. T. Bauer, ‘The Economic Development of Nigeria’, in The Journal of Political Economy, vol. 43 (October 1955), pp. 398–411.CrossRefGoogle Scholar
  12. E. M. Bernstein and I. G. Patel, ‘Inflation in Relation to Economic Development’, in IMF Staff Papers, vol. 2, No. 3 (November 1951), p. 393.Google Scholar
  13. 2.
    Cf. P. O. Steiner, ‘Choosing Among Alternative Public Investments’, in American Economic Review, vol. 49, No. 5 (December 1959), pp. 893–916.Google Scholar
  14. A. O. Hirschman has used the term ‘internalize’ to describe the opposite process (The Strategy of Economic Development (New Haven : Yale University Press, 1958), p. 57).Google Scholar
  15. 2.
    Cf. R. Nurkse, ‘Comments’ (on paper by P. N. Rosenstein-Rodan), presented to Round Table of the I.E.A., Rio de Janeiro, (Economic Development for Latin America (London : Macmillan 1961), pp. 74–8).Google Scholar
  16. J. H. Adler, ‘Deficit Spending and Supply Elasticities’, in Indian Journal of Economics, vol. 3, No. 144 (July 1955), pp. 17–18.Google Scholar

Copyright information

© International Economic Association 1964

Authors and Affiliations

  • John H. Adler
    • 1
  1. 1.International Bank for Reconstruction and DevelopmentUSA

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