ABSTRACT
The balance between the use of market forces and instruments of economic planning by the government in furthering the development process in third world countries has moved decisively in the direction of the former approach during the past 15–20 years. Yet the conditions under which unfettered market forces can provide for an optimal allocation of resources are exigent. This is the case when reference is made to a particular point in time, but even more so when alternative development paths for the future are considered. Furthermore, it is generally accepted that governments must assume responsibility for macroeconomic management and stability. Hence, governments continue to confront a series of routine and strategic planning issues, related, for example, to the need for systematic fiscal management and expenditure budgeting, on the one side, and the design of medium and longer-term production, investment and trade policies, on the other.
