Why should someone who is primarily interested in long-run growth in emerging and developing economies be concerned with the short-run macroeconomic performance of those economies? This is an important question for this book to address because the chapters that follow will all be concerned with short-run macroeconomic performance in countries whose primary aspiration is to improve their long-run growth performance. The answer is that a country's short-run macroeconomic performance can have an important effect on its long-run growth rate. Indeed, over the past two decades, a significant consensus has emerged among professional economists and policy makers in developing countries that certain aspects of short-run macroeconomic performance – getting key macroeconomic relative prices right and providing a stable and predictable domestic macroeconomic environment – play important roles in inducing the accumulation of productive factors and improvements in productivity that are the basic ingredients of long-term economic growth. A wide array of evidence is consistent with this proposition, derived both from case studies of successful and unsuccessful developing economies and from cross-country experience. The growing attention paid to macroeconomic issues by development-oriented institutions such as the World Bank and various regional development banks is one consequence of this new perception.