Economic policy making : lessons from Costa Rica

The essay shows how Costa Rica recovered from unemployment, inflation, and foreign debt in the early 1980"s, focusing on the methods of the Costa Rican policymakers -- how they selected policy objectives, and how they designed a structural adjustment program to achieve their objective. Six basic lessons were learned, under the two categories of formulating economic policy, and implementing economic policy. The formulation of economic policy includes the need to be realistic, to think big and act small, and to stay the course. Implementing economic policy includes the need to build consensus, establish leadership, and keep the public informed. (Author abstract, modified)