Economic Instability: A Case Study of the Effect of Structural Rigidity in Selected African Countries

The World Bank and the IMF believe that an aggressive implementation of the structural reforms is needed to enable the economies to respond to demand- and supply-side innovations. While structural adjustment programs can be adjudged as an essential tool of economic reforms, a gradual implementation of the programs would be more beneficial for at least two reasons. The first reason is that a gradual or phased-in implementation would trigger minimum public resentment, and the second reason is that since African economies are structurally weak, they cannot absorb heavy dose of corrective innovations. They simply collapse in the process.