Introduction and The Foreign strongSectorstrong and Chilean Economic.pdf

This PDF is a selection from an out-of-print volume from the National Bureau of Economic Research Volume Title: Foreign Trade Regimes and Economic Development: Chile Volume Author/Editor: Jere H. Behrman Volume Publisher: NBER Volume ISBN: 0-87014-508-8 Volume URL: /books/behr76-1 Publication Date: 1976 Chapter Title: The Foreign Sector and Chilean Economic Development: An Overview Chapter Author: Jere H. Behrman Chapter URL: /chapters/c4024 Chapter pages in book: (p. 3 - 45) I Chapter 1 The Foreign Sector and Chilean Economic Development: An Overview 1.1 INTRODUCTION In discussions of economic development experience, considerable emphasis has been placed on the foreign sector. This emphasis partly reflects the view that the foreign sector can play a key role in the development process through the exploitation of dynamic comparative advantage, the transfer of technology and of command over resources, and inducements for efficiency, and partly the fact that, in developing economies, the foreign sector is particularly subject to government influence. Analyses of the foreign sector in actual economic development experi- ence, however, usually have had definite limitations. In many cases the im- portance of quantitative restrictions in the foreign sector regime has been dis- regarded or understated. Historical perspective often has been lacking. Too frequently the supporting evidence is impressionistic, and available quantita- tive information has been ignored or not subjected to rigorous analysis. Re- peatedly other macroeconomic policies and the problems to which they relate have not been kept in their proper perspective, with the result that foreign- sector considerations may be, or may appear to be, overstressed. At times partial-equilibrium conclusions have been misleading or wrong. In some cases very strong assumptions h