Knowledge for Development: Economic Science, Economic Policy and Economic Advice

Discusses the role played in development by knowledge, including technical advances like invention of the telegraph or the discovery of a vaccine for smallpox, and asymmetric knowledge, about, for instance, the profitability of an investment project.

Economic ideas—knowledge about economics—have had a similarly profound effect, and are illustrated by discussing the economic ideas in three areas:

• the causes of and responses to the East Asian crisis
• financial liberalization
• privatization

However, it is imposible to separate values from purely scientific discussions, and in giving advice ecoomists are not just purveying economic science. Economists should think seriously about how advice in given and what incentives shape that advice.

Address to the World Bank's 10th Annual Bank Conference on Development Economics (ABCDE), April 1998