Transition and the State

The main focus of the report is a discussion of the role of the state vis-à-vis the transition to a market-based economy, and this is done in a very thorough manner. The conceptual framework and analysis focuses strongly on the role of the state in promoting efficient markets, while taking into consideration issues of externalities, public goods, and market failures. Through this more traditional economic analysis, the conceptual framework provided by the human development perspective is partly lost (but only partly). Although the report clearly states in several places that the purpose of economic development is to achieve progress in human development, the reader might not catch the significance of such statements. Human development seems to be equated with social development and tends therefore to become a sectoral concern, blurring the distinction between Human Resource Development and Human Development.