> Luke Weiger wrote:
>
> >Citation?
>
> I don't need a citation to say that free balance of payments
> financing in the range of 5% of GDP made a crucial difference in
> development - it's just a fact. Without it, SK would have had to
> impose domestic austerity or borrow large gobs of money abroad.
>
> Doug
Didn't say you needed it, though I would've appreciated it. However, as I suggested before, even if you're right (which I never claimed to be in a position to doubt), the argument you need is still incomplete. Of course it's a plain fact that the two Germanies and the two Koreas all needed a lot of foreign aid _at some point_ to get back on their feet (what doesn't seem so plain to me is why a 5% reduction in 1960s GDP would've doomed SK, but I'm no economist). The question is whether the differences in aid can explain the differences in outcomes. I don't think they can. Even if the Soviets and Chinese had been both able and willing to keep up with the Western Joneses, I think NK would've squandered the additional resources. (You could rightly note that my argument is also incomplete.)
-- Luke