The new development orthodoxy: a critique of the debate around the World Bank’s vision and elements for an alternative neo-Schumpeterian approach

Abstract

The purpose of this paper is to criticize the debate about the new hegemonic
view of the development process as proposed by the World Bank. First, it presents the theoretical
insufficiency of the debate centered upon the concept of market failures, pointing
that the neoclassical approach dominates its terms. Second, some theoretical elements of an
alternative neo-Schumpeterian view are presented which breaks radically with the neoclassical
foundations, embodying history, institutions and technological change in the analysis
of the development process, independently of either optimum or market failures concepts.

JEL Classification: B52; O31; O14.