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Economic Paradigm and Demand-Side Populist Policies in Thailand

Published online by Cambridge University Press:  19 January 2022

Naphon Phumma  and
Tanadej Vechsuruck Open the ORCID record for Tanadej Vechsuruck [Opens in a new window]
Naphon Phumma
Affiliation:
Faculty of Economics, Thammasat University, Thailand
Tanadej Vechsuruck*
Affiliation:
Department of Economics, University of Rhode Island, USA
*
*Corresponding author. Email: vechsuruck@uri.edu
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Abstract

In the last decades, demand-side populist policies (DSPPs) have played a significant yet controversial role in Thai politics. Most Thai economists disagree with DSPPs. They have argued that such policies are inefficient and have suggested the Thai government drop short-sighted DSPPs and replace them with supply-side policies that are more effective in the long run. However, Thai politicians have viewed DSPPs as unavoidable for political reasons and turned a deaf ear on economists’ suggestions to stop issuing them. In this paper, we argue that the domination of the neoclassical economics paradigm prevents Thai economists and politicians from understanding the role of DSPPs in shaping the demand and supply sides of the macroeconomy in both the short run and long run. Based on the theory of transformational growth, DSPPs are endogenous phenomena emerging from Thailand's uneven economic development. Therefore, Thailand could implement the policies to facilitate long-run economic growth. We propose three principles for future DSPPs that can positively impact the economy in the long run: boosting productivity, promoting innovation, and addressing income inequality.

Keywords

demand-side populist policies (DSPPs)populismThai economyneoclassical economicstransformational growth
Type
Original Article
Information
TRaNS: Trans-Regional and -National Studies of Southeast Asia , Volume 10 , Issue 2 , November 2022 , pp. 161 - 172
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Copyright
Copyright © The Author(s), 2022. Published by Cambridge University Press on behalf of Institute of East Asian Studies, Sogang University

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