World Development Report 1991: The Challenge of Development.

This report attempts to show how government and markets can interact most effectively to promote rapid economic development and benefit all people. The world economy is reviewed and an assessment is made of the impact of external factors on development. Alternative scenarios, optimistic and pessimistic, for the 1990s are considered. Four strategies for successful development are identified as crucial: (1) Investment in people is both a worthwhile goal in itself and an essential means of development. (2) Competition is essential to encourage innovation, entrepreneurship, and the growth of enterprises. (3) Openness to trade and integration into the global economy are necessary to spur growth, foster technology, and encourage capital flow. (4) Building a macroeconomic foundation that is both flexible and sustainable is necessary to support long-term economic growth. An overall argument is made that, in order for countries to develop, governments must complement markets. They should create institutions that enable the private sector to flourish in producing and marketing goods and services. Governments also should step in efficiently when markets prove inadequate or fail altogether. The report elaborates on these strategies in a detailed discussion of 15 specific actions that have worked in the past and can be adapted to solve the problems of the 1990s. It is concluded that, despite the challenges that remain, the opportunities for development are greater today than at any time in history. The World Development Indicators annex is appended, as are 33 statistical tables that provide comprehensive and up-to-date data on social and economic development for 124 countries. (Author/DB)