{
  "title": "Political Feasibility and Investment in Economic Transformations",
  "publication": "IMF Working Papers, July 1, 1993",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/30/political-feasibility-and-investment-in-economic-transformations-736",
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  "summary": "The paper characterizes the feasibility of economic transformation as requiring the simultaneous attainment of macroeconomic stability, political support, and adequate private investment.",
  "sections": [
    {
      "heading": "Analytical framework",
      "content": "- Feasibility of economic transformation requires the simultaneous attainment of:\n  - Macroeconomic stability, defined as fiscal balance.\n  - Political support, related to the income gains and losses of different population groups.\n  - Adequate private investment, which is linked to public “infrastructure” investment.\n- The analysis emphasizes interactions among fiscal policy, distributional effects across population groups, and public infrastructure’s role in mobilizing private investment.\n- Productivity gains arise when workers are induced to make occupational choices consistent with their comparative advantages."
    },
    {
      "heading": "Key findings",
      "content": "- Successful economic transformation depends on meeting multiple requirements concurrently (macroeconomic stability, political feasibility, and private investment).\n- Public “infrastructure” investment is a crucial determinant of private investment levels.\n- Political feasibility hinges on the distributional income effects of transformation policies across different population groups.\n- Achieving the simultaneous requirements may necessitate a “big push” involving external financial and technical assistance.\n- Inducing occupational choices aligned with comparative advantage yields important productivity gains."
    },
    {
      "heading": "Policy implications and recommendations",
      "content": "- Ensure fiscal balance to maintain macroeconomic stability as a foundation for transformation efforts.\n- Design transformation policies with explicit attention to the income gains and losses across population groups to build political support.\n- Use public infrastructure investment strategically to catalyze adequate private investment.\n- Consider coordinated external financial and technical assistance—a “big push”—when domestic resources and political conditions alone are insufficient to attain simultaneous requirements.\n- Implement policies that facilitate workers’ movement toward occupations consistent with their comparative advantages to capture productivity improvements.\n\nSource: Political Feasibility and Investment in Economic Transformations, Peter Isard and Joshua Aizenman.\n\n---\n\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/30/political-feasibility-and-investment-in-economic-transformations-736"
    }
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    "Authors: Peter Isard, Joshua Aizenman",
    "Published: July 1, 1993",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451967289.001",
    "Feasibility of economic transformation requires the simultaneous attainment of:",
    "The analysis emphasizes interactions among fiscal policy, distributional effects across population groups, and public infrastructure’s role in mobilizing private investment.",
    "Productivity gains arise when workers are induced to make occupational choices consistent with their comparative advantages.",
    "Successful economic transformation depends on meeting multiple requirements concurrently (macroeconomic stability, political feasibility, and private investment).",
    "Public “infrastructure” investment is a crucial determinant of private investment levels.",
    "Political feasibility hinges on the distributional income effects of transformation policies across different population groups.",
    "Achieving the simultaneous requirements may necessitate a “big push” involving external financial and technical assistance.",
    "Inducing occupational choices aligned with comparative advantage yields important productivity gains.",
    "Ensure fiscal balance to maintain macroeconomic stability as a foundation for transformation efforts.",
    "Design transformation policies with explicit attention to the income gains and losses across population groups to build political support.",
    "Use public infrastructure investment strategically to catalyze adequate private investment.",
    "Consider coordinated external financial and technical assistance—a “big push”—when domestic resources and political conditions alone are insufficient to attain simultaneous requirements.",
    "Implement policies that facilitate workers’ movement toward occupations consistent with their comparative advantages to capture productivity improvements."
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