Since the 1980s, a narrow range of fiscal, monetary, and exchange rate policy tools, and a limited role for the state were the essential components of the tool kit. Macroeconomic objectives were narrower than in previous eras and typical goals included fiscal discipline, inflation targeting, and market liberalization. The lessons ofthe last three decades have taught us, however, that the state has a key role to play in facilitating a development strategy that promotes greater equality with attention to sustainability goals.