When Public Goods Go Bad: The Implications of the End of the Washington Consensus for the Study of Economic Reform

Abstract

A principal approach to theorizing about economic reform in developing countries has been to assume that market-oriented policies have the properties of public goods, in that their benefits are widespread and their costs concentrated. This article reviews several books, one of them from the World Bank, that suggest that skepticism about these policies has entered the mainstream, calling into question this benchmark approach to reform. In the context of ongoing debate over which policies are best for developing countries, the review offers a framework for future study of reform, arguing that while past work has yielded important insights into how societal divisions and institutional characteristics affect reform, these insights now need to be combined with scholarship on how governments learn and form preferences about policies.