ABSTRACT
When asked about the most severe constraint of growth, the most popular answer from both government of¼cials and business people in developing countries is the lack of ¼nance. In reality, however, what is seriously lacking in those countries is often not ¼nancial means but the knowledge and mechanism for mobilizing available human and non-human resources toward productive purposes. Dropping money onto governments or enterprises that have no such knowledge or mechanism is not likely to improve the situation. The fact is that investors and donors will surely know when a country improves its capability to absorb skills and technology and will happily ¼nance investment or learning in such a country.
