Introduction

Abstract

The subject of financing economic development relates to the provision of real resources to raise the level of real output (national income) and living standards (income per head) in developing countries. The growth of output is not, of course, the only goal of economic policy in developing countries, but policies to raise the rate of output growth form the major part of most countries’ development plans, because (1) growth is seen as a necessary condition for an improvement in the general welfare and because (2) growth is seen as the precondition for the achievement of other development objectives such as the provision of greater employment opportunity, the redistribution of income and wealth, and the provision of social capital in the form of housing, communications and facilities for the development of human resources. Although it has become fashionable for the international middle class to renounce growth, it remains, in the absence of a massive redistribution of world income, the only means of eradicating primary poverty which still afflicts at least two-thirds of humanity.