Cadmus

Inclusive growth: Why is it important for developing Asia?

5. Conclusions
This paper has discussed the new concept of inclusive growth that some multilateral development agencies have adopted as part of their tool kit. Starting from the definition of inclusive growth as growth that allows all members of a society to participate in, and contribute to, the growth process, I have argued that in a modern capitalist economy the necessary condition for a citizen to participate in society is that he/she has access to a meaningful job. Given this, the paper has offered an interpretation of inclusive growth as a clear policy objective, namely, the achievement of full employment, that is, a state of zero involuntary unemployment. This means that no one who is ready and willing to work for an appropriate wage is without a job. This also means zero involuntary part-time employment.
Developing Asia is home to about 500 million people unemployed and underemployed. This is a major cause of poverty. An economy running as close as possible to full employment can deliver a great deal of benefits, both economic and social. For this reason, being as close as possible to full employment should be an explicit objective of policy makers across developing Asia. I have argued, however, that in today’s world, characterized by globalization, rapid technological progress, and the opening of formerly Communist countries, plus China and India, to the global capitalist market, it will be very difficult to achieve full employment. Finally, I have proposed five policies to achieve full employment of the labor force: (i) redress the neglect of agriculture; (ii) undertake public investment in basic infrastructure (energy, transport, urban services) targeted to high-employment projects; (iii) Use of industrial policy, understood as a collaborative effort between public and private sectors, to accelerate industrialization, and structural transformation in general; (iv) Gear fiscal and monetary policies for the achievement of full employment; and (v) Implement Job Guarantee Programs.

Notes
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