ABSTRACT
How can lenders and donors decide how much foreign capital a poor country should get? We have seen that they must at least assess the productivity of investment, the domestic average and marginal savings rate, the level of income per head, and the rate of population growth. Whereas the latter factors are more or less statistical, al though often unknown, the first in theory demands a complete survey of the investment possibilities, indeed of the whole economy. It is usually only within the framework of an entire investment pro gramme;—that is an economic plan-that the productivity of a single investment project can be properly assessed. This is part of the reason why donors have wanted to see development plans. In addition, plans give some earnest of the intention to try to develop in a rational co ordinated manner. Furthermore, of course, the production of a development plan should be a stimulus to a correct analysis of the obstacles to development, which we have discussed above, and to finding ways round or over such obstacles.
