World Development Report 1988 : Public Finance in Development

Technical Report

Part I reviews recent trends in the world economy and their implications for the future prospects of developing countries. Part II examines the role of public finance in development. Despite continued economic growth through 1987 and into 1988, two problems have characterized recent trends: unsustainable economic imbalances within and among industrial countries, and highly uneven economic growth among developing countries. Part I of the report concludes that three interdependent policy challenges need to be addressed. First, industrial countries need to reduce their external payments imbalances. Second, developing countries need to continue restructuring their domestic economic policies in order to gain creditworthiness and growth. Third, net resource transfers, external debt, from the developing countries must be trimmed so that investment and growth can resume. Part II of the report explores how public finance policies are best designed and implemented. How deficits are reduced is crucial: controlling costs in mobilizing revenues and setting careful priorities in public spending are equally important. Efficiency in providing public services and expanding the scope for raising revenue can be achieved through decentralizing decisionmaking and reforming state-owned enterprises with the latter permitting greater private participation.

 

Date and language
Dec 1988
English

Corporate Author

Vocabulary
Agrovoc terms: 
finance
Agrovoc terms: 
public finance

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