Summary of 4 Lessons for Developing Countries from Advanced Economies’ Past

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4 Lessons for Developing Countries from Advanced Economies’ Past summary
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Economic mismanagement characterizes many of the poorest countries in the world. Even with substantial external aid, their public spending and investment significantly lag those of advanced nations. Officials in emerging markets can learn important strategies from the developed economies’ policies of a century ago, when they were emerging. This succinct and thoughtful analysis from researchers Ivailo Izvorski and Kenan Karakülah offer leaders in government and NGOs valuable insights on growth and prosperity. 

About the Authors

Ivailo Izvorski and Kenan Karakülah are with the Brookings Institution.

 

Summary

Poor countries tend to insufficiently provide for their economic well-being and growth. They don’t take in enough revenue and so have less to spend and invest. For example, government spending in 2018 in sub-Saharan African nations averaged 23% of GDP, in contrast to 39% in the developed countries. Emerging nations’ revenue generation is inadequate to fund education, health care and infrastructure at the levels necessary to eradicate poverty and stimulate growth. Contrary to expectations, government receipts are lower and less stable in the resource...


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