A S MEASURED BY conventional development indicators, Malaysia, tXIndonesia and the Philippines have made substantial progress over the last ten to twenty years, both in aggregate terms and on a per capita basis. Growth rates in total output, sectoral outputs (agriculture, manufacturing, mining), savings, investment, exports, state revenues and development outlays, have generally exceeded both prior expectations and performance levels in most other less developed countries (LDCs). Food availability has on the whole kept up with or exceeded population growth; expenditures on textiles, housing, education, health, etc. have all registered rapid increases; and outlays on infrastructure, transport, communications and service facilities have transformed accessibility and ways of doing things at what must be considered an amazing pace. In other words, Malaysia, Indonesia and the Philippines are truly developing economies, with enviable growth performances, each averaging over the last decade a rate of growth of GNP of 6% per annum, or better. What has become increasingly worrisome, however, is the realization that all this expansion and modernization has apparently failed to eliminate many of the worst aspects of poverty in these countries, or significantly to improve living standards among the bottom 20% or 40% of citizens. Malaysia, Indonesia and the Philippines are not alone in this predicament of persistent poverty and widening inequality accompanying what otherwise appears to be remarkable economic progress. From the mid-ig6os, probably what is now a majority of LDCs have been found to be experiencing unsatisfactory distributional outcomes under prevailing strategies of economic development. This realization has prompted an agonizing reappraisal of hitherto