Global Economic Prospects and the Developing World

This article argues that a large group of developing countries did relatively well during the Great Recession, thanks to the broader room for countercyclical macroeconomic policies, and that the world economy will continue to be more dependent on the developing world than any we have known in history. However, it also claims that major emerging economies cannot serve in the immediate future as a strong enough alternative engine of world economic growth to the old industrial centers. Given the problems underlying world trade, it argues that the best scenario for the world is one in which major economies focus on their domestic demand growth. Published in Global Policy, January 2011.

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