ABSTRACT
This chapter introduces the key theoretical approaches to the study of global finance and development. It explores the key concepts that include investment, savings, capital accumulation, Harrod-Domar, neoliberalism, liberalisation, neoclassical growth theory, new institutionalist economics, Keyness economics, the developmental state, Marxist political economy, theories of imperialism, dependency theory, under development. The chapter provides the classical approach to the problem of development as a gap to be filled by investment and capital accumulation. It includes the intellectual underpinnings for one of these four positions: neoliberalism, liberal institutionalism, critical reformism and radicalism. Neoclassical growth theory is built around the primacy of economic fundamentals namely, preferences, resources and technology. There are two orthodox responses to the failure of the neoclassical predictions: endogenous growth theory and the new institutionalist economics. The influence of endogenous forms of growth theory had begun to highlight a limited role for government action. But this role was significantly increased with the growth of new institutionalist economics.
