Economic openness: problems to the century’s end

were substantially improved, thanks to comments by Amit Bhaduri, Gerry Helleiner, Steve Marglin, Perry Mehrling, and Ajit Singh. How open a national economy should be to foreign goods and financial flows is an antique question—to a large extent the conflicting answers of mercantilists and anti-mercantilists are with us after 300 years. For developing countries, controversy about openness to goods has always been present, but sharpened in the 1970's, as eminent trade theorists turned to policy advice. Starting with the publication of a book called Industry and Trade in Some Developing Countries by Little, Scitovsky, and Scott (1970), the notion that trade liberalization is an optimal development strategy has come to dominate the mainstream. Openness to international capital also has its defenders—most notably Cline (1984) who acknowledges the 1982 debt crisis but puts the best face possible upon it