Abstract

World Bank studies on structural adjustment in Subsaharan Africa (SSA) are critically discussed. Two essential theses of the Bank are rejected: structural adjustment led to erosion in economic rents and different results in adjustment were due to differences in reform endeavours among individual SSA countries. The paper argues that domestic rent erosion was accompanied by increases in international rents (development aid) and that this had negative allocative and distributional results. Second, different results of adjustment by countries have been marginal and widely exogenous. Above-average recovery of relatively successful countries are unsustainable because of highly integrated regional goods and factor markets. The paper advocates regional instead of national adjustment programmes and cuts in international rents if domestic price distortions have already been largely dismantled.