The State, Private Enterprise and Development
Rent-seeking is a phenomenon that is in evidence in many countries across the world regardless of their level of development. It tends to thrive in non-traded activities or in those sectors of the economy where competition is weak. Either way it is facilitated in environments where the State is weak and is unable to exercise its authority in an even-handed manner or project a long-term vision of development. The issues surrounding the role of the State and private enterprise in the economy became the bread and butter of discourse on political economy as far back as the 1930s, with the beginning of the Keynesian revolution. Simultaneously, how private enterprise might fit into the scheme of things where the State was umpire, rule-maker and player rolled into one raised new and contentious issues. In 1962, the Cambridge economist Joan Robinson, uncannily anticipating the controversies that would hit Economics in the 1970s asked, ‘what were the rules of the game?’ (Robinson 1963). In other words, as strongly held views on the State and society ebbed and flowed and political ideologies rose and fell with changing circumstances, how should the complex interactions between society and the institutions that it had set up for the purpose of its own governance, that is, the State, be viewed and assessed?
KeywordsSocial Justice Moral Hazard Private Enterprise Asset Bubble Securitized Loan
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