Democracy and Society » economic development

Method-driven policy

Barak — Sat, 24 Jul 2010 19:51:56 +0000

Just because one can’t measure the impact of a program is not a sufficient reason to end it.

Why develop rural Africa?

Barak — Sat, 24 Jul 2010 15:58:54 +0000

Northern Zambia doesn’t have a lot of people. The towns are small, and few and far in between. The land is not good for farming, in general, either. Nevertheless, foreign aid donors are spending lots of money in trying to “develop” the region. One thought that crossed my mind while I was there last week was whether this is a good use of resources. Like the rest of Africa, Zambia has been urbanizing rapidly and I doubt that there will be many people left in rural parts of northern Zambia in 20 or 30 years. So why are donors spending money there? At best, it is simply slowing urbanization. Wouldn’t it be more reasonable to accept the inevitable and pull aid from parts of Africa where people are leaving and putting more into where they are going?

Xtreme path dependency

Barak — Fri, 16 Jul 2010 13:11:24 +0000

I’ve got some time on my hands here at JNB, so I am catching up on what’s happening in the world. I came across a great new paper by Diego Comin, William Easterly, and Erick Gong that shows the level of technology 2000 years ago is a pretty good predictor of per capita income today. Now, to be clear, this does not mean that geography is destiny as the country where I am right now, South Africa, has a much higher income than its level of technology in 1500 would predict (despite wrenching, policy-induced income inequality, such as this brilliant attempt at social engineering). Although I am not a big fan of structural arguments alone for political and/or economic outcomes, its foolish to deny that nature affects economic development, especially before the industrial revolution. How to overcome the structural challenges nature places before us is perhaps the central question of development.

Stop looking for magic beans

Barak — Mon, 12 Jul 2010 20:08:05 +0000

Over at Aid Watchers, Bill Easterly patiently discusses (not for the first time) why the search for the magic development intervention that will make a poor country a rich one remains (and will always remain) elusive.

Bureacracy

Barak — Wed, 30 Jun 2010 21:36:22 +0000

The solution to too much bureaucracy is less bureaucracy, not more bureaucracy.

Development first crowd proven wrong again

Barak — Mon, 28 Jun 2010 19:30:38 +0000

Yet another example of why the development first theory is wrong:

Take Inderaw Mohammed Siraj, a 60-year-old Ethiopian opposition candidate who lost a finger after being beaten by ruling-party cadres in 2008. Last year, he says, he was kicked out of a food-aid program funded by the U.S., the World Bank, and the European Union when a local official from his village in a remote corner of northeast Ethiopia told him: “We will not feed opposition members.”

With virtually no opposition representation in Parliament, the independent press and local human-rights groups now closed or under attack, and the prospect of his children begging for food, he has realized life would be easier if he gave up politics.

I have no doubt that the development firsters will go away anytime soon, but it’s good to have examples of why they are wrong – especially from Ethiopia because this country is often one of their main examples.

Kim Jung Il, Capitalist

Barak — Sat, 19 Jun 2010 03:13:30 +0000

Seriously. One point I have made on this blog over and over again is that poor countries are poor because they have bad governments. North Korea is an extreme example of this point, but that makes the concept all the more tangible. The regime’s zealous efforts to repress markets (i.e., make consensual economic exchange illegal) has led to mass starvation and famine. I am far from a proponent of Laissez Faire economics – very far. At the same time, North Korea could not be as poor as it is without the active role of the government in preventing economic growth.

Thank you, Aid Watchers

Barak — Sat, 19 Jun 2010 02:56:45 +0000

I was going to write about the problems I saw with Paul Romer’s idea for charter cities. However, I knew it would be a long-ish post, so have been procrastinating. Laziness, fortunately, paid off for me this time as Laura Freschi at Aid Watchers has written a better version of what I was going to say:

It has always been true that no matter where you go, you take yourself with you—culture, history, habits, attachments and animosities come along like a skin you can’t shed…

Early development economists working at the hopeful dawn of colonial independence believed that they really were starting from scratch. The last fifty years have shown us that they weren’t, and this has been—and remains—one of development’s biggest blind spots.

As the gang on King of the Hill would say, “Yep. Yep. Mmhmm. Yep.”

The traffic in Dar is bad, but not special

Barak — Tue, 15 Jun 2010 03:14:14 +0000

The Mikocheni Report has a spot-on post on the terrible traffic in Dar es Salaam. The city is seriously out of control: massive population growth + no new roads = traffic nightmare. Where I disagree is that the traffic situation in Dar is idiosyncratic. The traffic in Dar reminds me a lot of traffic in Nairobi a decade ago, or in Accra and Cairo today. Rather than being special, Dar es Salaam today is an excellent example of growth without government.

Export-led growth

Barak — Thu, 27 May 2010 19:08:31 +0000

It seems the US has a novel model for export-led growth:

We show that following CIA interventions there was an increase in foreign-country imports from the US…This is consistent with US influence being used to create a larger foreign market for American products.

I wonder if USAID finances these types of programs abroad.