By Samih Antoine Azar and Ali Bolbol[1]
Introduction
In economic policy circles there is a debate on the relative benefits and costs of adopting a “cold turkey” approach to policy-making where all policy changes are made at the same time and at once or, alternatively, of having a more gradual implementation of policy, or sequencing. The general understanding is that sequencing provides a more ordered approach to policy making and gives a breathing space for the economy to adjust against multiple policy shocks. In contrast, the argument for policy concurrence is mostly a political economy argument: undertaking reform policies all at once allows losers from one policy action to be compensated by gains from a different policy action, thus making reform benefits more palpable to the wider society; and, as important, it preempts reform adversaries and denies them the time to group and to formulate a serious opposition to the policy reform agenda.
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Is the Sequencing of Economic Reform Desirable in Lebanon.doc