Free markets and economic development in postwar developing countries

This study analyzes examples of such successful, market-oriented economies. An initial section shows how economic theory establishes the essential conditions under which free, or competitive, markets operate and demonstrates that free markets maximize economic efficiency. It points out further that economic activity does not operate in a vacuum, but depends on government to provide an institutional framework in which the market economy can function. In section two, the author considers what mix of fiscal, monetary, regulatory, and international policies is appropriate to the free market economy. Sections three through eight examine in detail post war economic policies, and their results, in Hong Kong, Singapore, Taiwan, Korea, the Ivory Coast, Chile, and Sri Lanka in order to determine the central components of rapid economic growth. Recognizing that most countries do not stress free market policies, the author then explores how more modest policy reforms can improve efficiency.