ABSTRACT
I am not suggesting that no static efficiencies were reaped from antitrust enforcement, for this is not the case, particularly in situations where a small number of producers can garner control of a key input. However, static-efficiency benefits, whatever their size relative to dynamic-efficiency losses, have largely accrued to the developed economies, whereas the costs of neoclassical thinking have been paid disproportionately by those who live in the Second and Third Worlds, whose economies became repositories for the destructive programmes propagated by the ‘conceited men of system’ who were so derided by Sir James Steuart (1805, vol. I: xii, xv, 218), Adam Smith (1976:231-4), and Edmund Burke (149-55, 267). Of course, modern theory cannot be held entirely accountable for unrealized GDP potentials, much of which are traceable to the dearth of growth-enhancing sociopolitical institutions in the Second and Third Worlds. Communist regimes intentionally destroyed them in the former, while in the latter, primitive market institutions either were non-existent or were subverted by colonial rule and the home-grown despots who succeeded to power. (For the African institutional experience, see either Ayitteh 1990:27 and 301, or Ayitteh 1992:66-9.) Nonetheless, the prolongation of this institutional void was not a random historical event. Neoclassical economics must be accorded a sizeable measure of responsibility for the widespread and long-lasting suffering attributable to the affinity for central planning. This affinity has saturated intellectual and public-policy forums throughout the Third World (and the First World!), and has thereby promoted the growth of state bureaucracy at the expense of the institutional matrix required to facilitate capital markets and the free exchange of goods. As Mancur Olson has correctly observed, ‘it takes an enormous amount of stupid policies or bad or unstable institutions to prevent economic development’ (Olson: 175). Due to the substantial assistance provided by the Walrasian-rooted prescription of mainstream development literature, neoclassical economics stands easily indicted on this score.
