STRUCTURAL ADJUSTMENT - SUMMARY

A Series of economic policies designed to reduce the role of government in an economy replacing government control with market incentives.

Structural Adjustment Policies

• Privatization
• Promotion of Competition
• Reduced Role of Government
• Removing Price Controls
• Freer Trade and Convertible Currency
• Foreign Investment
• Other

Characteristics of Market Economies:

• private property and economic growth
• markets and prices
• role of self interest: the PROFIT incentive and efficiency
• freedom of enterprise and choice
• competition = capitalism
• limited role for government

STRUCTURAL ADJUSTMENT Command Economy Market Economy Who owns? | | Who decides: | | Command Economy Market Economy Role of government: | | 5Es - Economic Growth: | | 5Es - Productive Efficiency: | | 5Es - Allocative Efficiency: | | 5Es - Equity: | | 5Es - Full Employment | | Command Economy Market Economy Role of International Trade: | | Guiding Resources: | | Allocating Goods and Servises: | | Role of Incentives: | | "Greed" or "Social Good": | | Command Economy Market Economy Role of Government: | | | | | | | | | | | | | | | | | | | | | |