Fads and fashion in economic reforms: Washington Consensus or Washington Confusion?

• Published in: Third world quarterly 2000-06, Vol.21 (3), p.505-528
• Main Author: Naim, Moises
• Format: Article
• Language: English
• Subjects: Conceptualization; Developing Countries; Economic crises; Economic Development; Economic Policy; Economic reform; Economic stabilization; Economics; Fads; International economic policy; International economics; International financial institutions; International political economy; LDCs; Macroeconomic reform; Macroeconomics; Policy analysis; Policy making; Political reform; Public opinion; Reform; United States; United States of America; World Bank
• ISSN: 0143-6597; 1360-2241
• DOI: 10.1080/01436590050057753

During the 1990s, many economists believed that there was a clear & robust consensus about what an underdeveloped country must do to achieve prosperity. This was largely due to the popularity of the "Washington Consensus" -- 10 policy recommendations for economic reform specified by economist John Williamson in 1989. Williamson described what he believed was a consensus shared by political Washington & technocratic Washington, but he could not know that he was creating a catch phrase that would be enthusiastically embraced by economic reformers in many countries. He also did not know that the term would obscure profound disagreements among policy experts or that it would be used as a label for a multitude of very different reforms. As the 1990s progressed, the Washington Consensus experienced major mutations & shrinkage. As economic reforms unfolded, governments were forced to change policy goals that had appeared to be the final objective of reform but proved to be merely preconditions for success. New, more complex goals were constantly added. As the 1990s ended, it was clear that policymakers must reevaluate five general issues: international economic instability, investment, inequality, institutions, & ideology. 2 Tables, 42 References. A. Funderburg