Kicking Away the Ladder.

The article discusses the development of capitalism in Great Britain and in the U.S. Great pressure is currently being applied on developing countries by the developed world, and the international development policy establishment that it controls, to adopt a set of "good policies" and "good institutions" to foster their economic development. According to this agenda, "good policies" broadly are those that include restrictive macroeconomic policy, liberalization of international trade and investment, privatization, and deregulation. The key institutions include democracy, good bureaucracy, an independent judiciary, strongly protected private property rights and transparent and market-oriented corporate governance and financial institutions. This article has shown how the currently dominant neo-liberal argument for free trade and laissez-faire industrial policy is based on a fundamentally mistaken reading of the history of capitalism. Particularly important in this argument is the very selective and distorted reading of the economic histories of Great Britain and the U.S., whose ascents to industrial supremacy are erroneously attributed to their free trade policy and non-interventionism.