This research reviews the economy of the Philippines. Economic development over the past two decades (growth and downfalls), and current economic conditions are surveyed. National economic policy orientation and application are examined with an emphasis placed on the role of government in economic management (industry and state). Monetary policy orientation and outcomes are considered, and regional economic policy initiatives are discussed within the contexts of fiscal policy and national economic objectives.
Economic Development (Growth and Downfalls)
Economic growth is defined in positive terms as the rate of change in gross national product--GNP (Gwartney, Stroup, & Studenmund, 1994, p. 793). Within this definition, a decline in GNP would be referred to as negative growth. There are two general types of economic growth. Extensive economic growth refers to an expansion of the total output of goods and services, regardless of the change in per capita output. Intensive economic growth refers to an increase in per capita output.
Development is a normative concept that encompasses economic growth, but which also includes structural and distributional changes which should lead to improvements in the living standard for a majority of an economy's population (Todaro, 1991, p. 87). Thus, if economic growth occurs but most of the benefits of such growth accrue to a relatively small economic elite, then positive development in that society has not occurred.
A country may experience economic growth without development; however, a country may not experience development in the absence of economic growth, because economic growth is a component of development (Gwartney, Stroup, & Studenmund, p. 793). A developing country may experience economic growth in the absence of development. Many oil-rich countries achieved phenomenal rates of economic growth during the 1970s. Development, however, did not occur in all of these countr...