In this lecture, Joseph E. Stiglitz acknowledges the failure of the "Washington Consensus" in promoting economic growth and proposes a new consensus where the state plays an active role. He begins by discussing the lessons from the Asian financial crisis, emphasizing the need for broadening the goals of development. Stiglitz argues that the Washington Consensus, which focused on liberalized trade, macroeconomic stability, and price reforms, is incomplete and sometimes misguided. He highlights the importance of sound financial regulation, competition policy, and policies to facilitate technology transfer and transparency. Stiglitz also discusses the need for a broader set of instruments to promote well-functioning markets, including sustainable development, egalitarian development, and democratic development. He emphasizes the trade-offs involved in policy choices and the importance of complementary strategies to advance these goals. The lecture further explores the process of financial reform, the role of competition, and the challenges of privatization. Stiglitz argues that building robust financial systems is crucial for macroeconomic stability and long-term growth. He emphasizes the need for effective regulation to ensure safety, competition, consumer protection, and access to capital for underserved groups. Stiglitz also discusses the importance of competition in a successful market economy, noting that competition is often imperfect in developing countries. He suggests that competition policy should be integrated with trade policy to curtail abuses such as dumping and to promote fair competition both domestically and internationally. Overall, Stiglitz advocates for a more comprehensive approach to economic development that goes beyond the Washington Consensus, recognizing the need for active state intervention and a broader set of policies to achieve sustainable and equitable growth.In this lecture, Joseph E. Stiglitz acknowledges the failure of the "Washington Consensus" in promoting economic growth and proposes a new consensus where the state plays an active role. He begins by discussing the lessons from the Asian financial crisis, emphasizing the need for broadening the goals of development. Stiglitz argues that the Washington Consensus, which focused on liberalized trade, macroeconomic stability, and price reforms, is incomplete and sometimes misguided. He highlights the importance of sound financial regulation, competition policy, and policies to facilitate technology transfer and transparency. Stiglitz also discusses the need for a broader set of instruments to promote well-functioning markets, including sustainable development, egalitarian development, and democratic development. He emphasizes the trade-offs involved in policy choices and the importance of complementary strategies to advance these goals. The lecture further explores the process of financial reform, the role of competition, and the challenges of privatization. Stiglitz argues that building robust financial systems is crucial for macroeconomic stability and long-term growth. He emphasizes the need for effective regulation to ensure safety, competition, consumer protection, and access to capital for underserved groups. Stiglitz also discusses the importance of competition in a successful market economy, noting that competition is often imperfect in developing countries. He suggests that competition policy should be integrated with trade policy to curtail abuses such as dumping and to promote fair competition both domestically and internationally. Overall, Stiglitz advocates for a more comprehensive approach to economic development that goes beyond the Washington Consensus, recognizing the need for active state intervention and a broader set of policies to achieve sustainable and equitable growth.