The sound management of public finances is, in Williams' view, the most important factor in attaining the twin objectives of ecomic growth and improvement in the standard of living in small open developing ecomies. While looking at the challenges of public finance management in small states, with a focus on Barbados, this book suggests strategies of fiscal and microecomic management for small ecomies that will permit them to ensure macroecomic stability while promoting ecomic growth and development. In discussing the philosophy of public finance, it examines small size and openness, using both traditional criteria and modern perspectives of liberalized systems. It deals with the challenge of avoiding overly expansionary budgets and the need for counter cyclical policies in relation to macroecomic objectives. This book also discusses state involvement in commercial types of enterprise and the implications for efficiency and ecomic growth. The Keynesian approach to fiscal spending is compared with the structuralist approach, which takes into account initial conditions and inflexibilities facing small developing ecomies. The government's role in financing accelerated ecomic development, its social responsibility, and the balancing need for fiscal discipline are also considered. The public finance performance of governments is seen as facing important challenges to its capacity to champion ecomic development given the increasing global perception of a mostly regulatory and stabilizing role of government.
MARION V. WILLIAMS is Governor of the Central Bank of Barbados, where she previously served as economist, adviser, and Deputy Governor. Her research over the past three decades has focused on the special circumstances of developing countries, with particular reference to the Caribbean. She is author of the book Liberating a Regulated Banking System: The Caribbean Case.