In the public choice (or new political economy) approach to development the emphasis is on
a. growth in the rural sector.
b. the self-interested behavior of public officials.
c. the dependence of LDCs on former colonial powers.
d. the inherent efficiency of developing country markets.
B
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The incentive for people to avoid paying for a resource when the benefits they obtain from the resource are unaffected by whether they pay is known as ___________________.
a. the Coase Theorem. b. an upstream tax. c. the holdout effect. d. free market environmentalism. e. None of the above.
When an investment project generates output that is valued more highly than the value of the resources required for its production,
a. undertaking the project will create wealth. b. it will generally be profitable to undertake the project if property rights are securely defined and enforced . c. entrepreneurs seeking profit will have little incentive to undertake such projects. d. both a and b are correct.