- Open markets - internal
and external competition in markets for goods and services
- Promotion of liberal
capital market providing a flow of liquidity to finance investment
- Protection of private
property rights
- Scale of government
spending - possible crowding out of the private sector if government
spending is too
- Efficiency of the tax
and benefit system - may create disincentives which constrains the active
labour supply
- Incentives for
entrepreneurial activity
- Investment in human
capital - active labour market policies
- Macro-economic
stability and credibility of macro economic policy
Young,
1994, Asian tiger's success resulted from:
·
Rapid accumulation of capital (through high investment)
·
Labour (through population growth and increased labour-force
participation)
·
Government policies of encouraging education, opening economy
to foreign technologies, promoting trade, keeping taxes low & encouraging
savings (30% of GDP in 'tiger' economies)
·
Small state - government spending around 20% of GDP compared to
over 50% in Europe
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