The Rise and Fall of Export-Led Growth

Levy Economics Institute of Bard College Working Paper No. 675

24 Pages Posted: 20 Jul 2011 Last revised: 27 Jul 2011

See all articles by Thomas I. Palley

Thomas I. Palley

Economics for Democratic and Open Societies

Date Written: July 19, 2011

Abstract

This paper traces the rise of export-led growth as a development paradigm and argues that it is exhausted owing to changed conditions in emerging market (EM) and developed economies. The global economy needs a recalibration that facilitates a new paradigm of domestic demand-led growth. Globalization has so diversified global economic activity that no country or region can act as the lone locomotive of global growth. Political reasoning suggests that EM countries are not likely to abandon export-led growth, nor will the international community implement the international arrangements needed for successful domestic demand-led growth. Consequently, the global economy likely faces asymmetric stagnation.

Keywords: Export-led Growth, Domestic Demand-led Growth, Economic Development, Stagnation

JEL Classification: F00, F01, F02, F10, F20, F50, O11, O19, O24

Suggested Citation

Palley, Thomas I., The Rise and Fall of Export-Led Growth (July 19, 2011). Levy Economics Institute of Bard College Working Paper No. 675, Available at SSRN: https://ssrn.com/abstract=1889167 or http://dx.doi.org/10.2139/ssrn.1889167

Thomas I. Palley (Contact Author)

Economics for Democratic and Open Societies ( email )

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