By Donald Marron

30-Second Economics

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Sample text

But Williamson argues that they’re not the same. The Washington Consensus may be a damaged brand name, he says, but in some cases its ideas worked—for example, when Argentina privatized the water supply, infant mortality in the poorest areas decreased by 24 percent. ” JOHN WILLIAMSON Reduce regulation from government and give free enterprise the power to prosper for the benefit of all. ECONOMIC CYCLES GLOSSARY aggregate demand The total demand for goods and services within an economy at a certain time.

He argues that globalization and the free market have “kicked away the ladder” of state intervention and protectionism that rich countries once used to develop strong economies from beneath the feet of today’s poor and developing countries. 3-SECOND CRASH Keep the foreigners out and your money in and make sure you always sell abroad more than you buy—it’s nationalism for the economy. 3-MINUTE BOOM To proponents of free trade, mercantilism just doesn’t add up. The strongest opponents of mercantilism have been classical and Austrian school economists.

RELATED THEORY CLASSICAL 3-SECOND BIOGRAPHY JEAN-BAPTISTE COLBERT 1619–1683 30-SECOND TEXT Christakis Georgiou “Almost all of today’s rich countries used tariff protection and subsidies to develop their industries. ” HA-JOON CHANG Export more than you import—with the help of government subsidies and tariffs— and invest at home and your national economy will quickly prosper. ” For a government-controlled economy that’s suffering from chronic food shortages or hyperinflation, for example, the solution is radical change.

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