Today the industrialized world as a whole is embarked--half-heartedly, I admit--on yet another crusade to try to make the poorer parts of the world rich. The ideology behind this crusade--an ideology that I believe in--is called "neoliberalism." It has two guiding principles. The first is that close economic contact between the industrial core and the developing periphery is the best way to accelerate the transfer of technology which is the sine qua non for making poor economies rich (hence all barriers to international trade should be eliminated as fast as possible). The second is that governments in general lack the capacity to run large industrial and commercial enterprises (hence save for core missions of income distribution, public-good infrastructure, administration of justice, and a few others, governments should shrink and privatize).
However, this neoliberal crusade is not the first such crusade for economic development. Since World War II there have been at least six such crusades: the "building socialism" crusade, the "financing gap" crusade, the "import substitution" crusade, the "aid for education" crusade, the "oil money recycling" crusade, and the "population boom" crusade.
All of them failed to spark rapid economic development. Does what went wrong then have any lessons to tell us about the future of the crusade we are undertaking now? Yes--and now is a good time to take a look back at the history of crusades-for-development since World War II, for World Bank economist Bill Easterly has just written The Elusive Quest for Growth, his own take on the largely dismal history of government-led programs to spark development.
These different crusades in the past overlapped in time, so there is no clear chronological sequence among them. Among the first, however, was the "building socialism" crusade. Easterly does not cover this: his concern is with the quality of...