Developmentalism at the periphery: addressing global financial asymmetries

Abstract

Since the 2000s, new concepts of developmentalism have emerged in Latin America. In such approaches, the state deliberately pushes the development to achieve structural change and income redistribution. We analyse these from the perspective of policy space constraints imposed by international economic asymmetries, which today are predominantly of a financial nature. Based on a broad overview, we identify and compare the most relevant recent approaches. ‘New developmentalism’ has its strength in formulating adequate macroeconomic policies shielding the economy from volatility, although it considers redistribution as rather an outcome of structural change. ‘Social developmentalism’ emphasises the links between redistribution, domestic growth and structural change but lacks a coherent formulation of macroeconomic policies. The same applies to the concept of buen vivir, as the only approach that considers environmental aspects. Thus, all of these concepts have their strength in addressing specific issues, but are incomplete insofar as they do not provide a consistent framework for achieving all goals of growth with structural change, income redistribution and ecological sustainability. We identify the need to debate the interdependencies between sustained economic growth, income distribution and ecological sustainability.