It is useful to assess the effect of Nanking fiscal policy on the Chinese economy since we are once again in the strategic position of rendering aid and advice to under-developed areas. (Nanking fiscal policies were predominantly repressive of economic development; they were not designed to alleviate the traditional economic burden on the peasant nor to promote the growth of industry.)

In the area under consideration in this paper, eight countries with a population of 600 million people or about 30% of the world's total population have acquired their independence since the end of World War II. National governments in this area are faced with serious economic, social and other problems, many of them long-standing but of more compelling current importance because of the raised expectations of the Asian peoples. The technical and financial resources of these governments for meeting their problems are limited and, in some cases, ineffectively and inefficiently used. Their ability to develop, in the short-term future, solutions to these problems judged effective by their people will determine the survival of these or similarly-oriented governments, or their replacement by chaos or extremism.

Mr. Paauw's paper on Chinese government expenditures during the Nanking period and Mr. Wolf's paper on contemporary development problems in South and Southeast Asia differ appreciably in scope and emphasis. In a sense however Mr. Wolf's paper picks up the discussion where Mr. Paauw leaves it. For Mr. Paauw concludes in his last paragraph that in China between 1928 and 1937 loan-financed government expenditures did not stimulate investment and output because “… the whole political, cultural, and economic milieu of Nanking China … discouraged the expansion of output in response to increased monetary demand. The repressive influence of each of these factors remains to be investigated in detail.” Mr. Wolf's paper is essentially an analysis of these factors which inhibit and restrict productive investment and economic development in Southeast Asia and what might be done through MSA to improve matters. Consequently Mr. Paauw's paper is perhaps more easily discussed against the analysis put forward by Mr. Wolf rather than the other way about.