Friday, April 29, 2011

Poverty

Writing in Foreign Policy, Abhijit Banerjee and Esther Duflo question the dictum that huge numbers of the world's poor are hungry. An interesting passage describes Jeffrey Sachs's explanation for why certain countries are poor:
Jeffrey Sachs, an advisor to the United Nations and director of Columbia University's Earth Institute, is one such expert. In books and countless speeches and television appearances, he has argued that poor countries are poor because they are hot, infertile, malaria-infested, and often landlocked; these factors, however, make it hard for them to be productive without an initial large investment to help them deal with such endemic problems. But they cannot pay for the investments precisely because they are poor -- they are in what economists call a "poverty trap."
I'm sure that Professor Sachs has debated these issues endlessly, and would probably have easy retorts for anything some blogger would say, but his explanation has a bit of the just-so story to it. For instance, what about a very cold, landlocked country with very inhospitable terrain, whose inhabitants use to suffer from iodine-deficiency goiter (which can produce mental retardation)? That would be Switzerland, one of the wealthiest nations on earth. What about a formerly malaria-infested, hot, crowded, island with virtually no agricultural land, whether fertile or not? Singapore. Or the hot, landlocked, malaria- and other disease-infested nation that was known as Rhodesia? Or a nation that must import virtually all necessities, is subject to devastating earthquakes, lost millions of war dead, and had two atom bombs dropped on it?

I think we can look for the sources of poverty elsewhere. As the article in Foreign Policy makes clear, the poor often make, well, poor choices, buying television sets and cell phones instead of more and better food, for instance.
In rural Morocco, Oucha Mbarbk and his two neighbors told us they had worked about 70 days in agriculture and about 30 days in construction that year. Otherwise, they took care of their cattle and waited for jobs to materialize. All three men lived in small houses without water or sanitation. They struggled to find enough money to give their children a good education. But they each had a television, a parabolic antenna, a DVD player, and a cell phone. [...]

We were starting to feel very bad for him and his family, when we noticed the TV and other high-tech gadgets. Why had he bought all these things if he felt the family did not have enough to eat? He laughed, and said, "Oh, but television is more important than food!"
One might think that during some of the 265 days that these men had off that year, they could scrape together some sort of sanitation for their houses.

26 comments:

  1. Now that the Royal Wedding is out of the way, I'm very much looking forward to reading Banerjee's and Duflo's book, which will be out in the UK soon. It's high time the discourse on development economics finally turned towards a focus on agency rather than all the Western bashing talk on structure.

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  2. From reading and reflecting on Greg Clark's Farewell to Alms - http://www.econ.ucdavis.edu/faculty/gclark/a_farewell_to_alms.html - I infer that there is really severe hunger in sub-Saharan Africa; and that the main cause is the low child mortality (due to partial Westernization).

    So that SSA populations are often more than doubling in numbers each generation (median age in mid-teens) despite consuming fewer calories per day than anyone has existed on in human history. That's hunger.

    A couple of hundred years ago, sub-Saharan Africans had relatively leisurely and well-fed lives (more so than many Europeans) because the population density was kept low by very high child mortality and malaria (etc).

    The West gifted Africa effective medicine and health care - but it is a double edged gift, both for Africans, and for the rest of the world which Africans are now colonizing.

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  3. Off topic: Anyone else notice that in the last couple days a lot of the commercials in front of the videos on YouTube are in Spanish all the sudden. WTF?

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  4. Aid to Africans, including food aid, only adds to the problems of these poor souls. Any temporary relief is more than canceled out by a rise in the breeding and infant survival rates the aid enables.

    The bright sparks who run the international aid bureaucracies can't think except in terms of (1) their own jobs and (2) the emotional satisfaction of "helping." Long-term results -- past the next media story -- don't register on them.

    I don't want Africans to starve. But if we're honestly concerned about their good, and not just showing off our institutionalized compassion, we should insist that any aid be tied to population stabilization programs. If they react with cries of "racism!" then we should simply say, "Very well, we are recalling all our aid workers and you can have your countries for yourselves alone, with no white colonialist devils to interfere with you. Have a good day."

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  5. Bruce, In my view A Farewell To Arms provides very compelling evidence that the effort by Bill Gates to cure Africa's diseases will lower average living standards and deepen the Malthusian Trap.

    As for the use of Poverty Trap rather than Malthusian Trap: Reduces clarity. But par for the course in our era.

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  6. The only way out would be to artificially re-run the evolutionary process that occurred when humans moved out of Africa.

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  7. I don't think Bill Gates, or Hillary Clinton BTW, are in favour of an African population explosion; they just think that by educating the women you can stop the high birth rates.

    Magical thinking?

    Anon.

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  8. It didn't say thy needed food. I suspect they have enough food. TV's are pretty cheap anyway. But, a lot of people need to be told what to do. This whole idea that people can spend their money better than the govt is nonsense, at least for some people. Some people just can't think that well.


    "A couple of hundred years ago, sub-Saharan Africans had relatively leisurely and well-fed lives (more so than many Europeans) because the population density was kept low by very high child mortality and malaria "

    I think I read that agriculture actually made life worse because it increased the population and everyone was living in close proximity which helped foster disease. It also probably caused more startvation when the crops didn't do well.

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  9. I've always found it amusing that the Peace Corp sends college-educated white Americans to 3rd world countries to dig wells and latrines. Ship out a few shovels and let the locals dig their own holes!

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  10. > I think I read that agriculture actually made life worse because it increased the population and everyone was living in close proximity which helped foster disease. It also probably caused more startvation when the crops didn't do well.

    True - also, nutrition was worse in non-crop-failure times, in at least some periods.

    But there's no free lunch. Agriculture, especially with cities, was associated with a massive decline in violence. If I'm a Yanomamo, my chances of dying violently are 30%, and odds are high that some year or other I'll have a mother, sister, or daughter abducted, gang raped, and forced to marry in an enemy village (this was the fate of 15-20% of women). Plus, I never have any idea when one of these things might be about to happen. Attempts would take place more than once a year.

    Those figures are pretty typical for primitive societies. Medieval Europe, the Persian Empire, China in 1000 BC, Egypt in 700 BC, would all have featured far less of these nasty things: probably between 8x and 20x less. In China, maybe more than 20x.

    But there's one more downside to civilization: heavy labor. Primitive societies featured so much bloodshed that there were few people on the land and less work and less self-denial were necessary (this fact has an ongoing legacy today). In contrast, the condition of civilized peoples (excepting the gentry and a tiny bourgeoisie of craftsmen) was probably not far from slavery or serfdom - especially when they were controlled by men of a different ethnic group. For example, the Roman Empire. If you didn't please, it was the lash for you. Running away was not very tempting; people were hostile to randomly-waltzing-around foreigners and would decline to give you an economic role, if they didn't just kill you.

    So, it's either an ultra-violent lifelong camping trip, or a groaning lifelong serfdom where you perhaps occasionally glimpse a glorious work of art.

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  11. My question is why poor people often are messy and dirty. I mean if they can't find work, they could tidy up a bit. They have plenty of time since they aren't working.

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  12. "I don't want Africans to starve. But if we're honestly concerned about their good, and not just showing off our institutionalized compassion, we should insist that any aid be tied to population stabilization programs."

    We need to offer birth control as the only form of foreign aid. Practically any place on earth can be more prosperous with a smaller population.

    No food aid.

    No military aid.

    No medical aid.

    No monetary aid.

    No technology aid.

    Nothing except birth control.

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  13. In the meantime, while they're puzzling the question out, let's just make sure they stay where they're at. As long as they're there and not here we'll be better off. Let the academics write their papers all they please; just don't get sucked into any schemes to do something on their behalf as it always just makes things worse.

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  14. "My question is why poor people often are messy and dirty. I mean if they can't find work, they could tidy up a bit. They have plenty of time since they aren't working."

    That's because unemployment will breed depression and delinquency if the person doesn't take steps to stop it early. I know this from personal experience.

    I am a software engineer in Bay Area and lost my job to H1B engineers from India in early 2002. I was mostly unemployed or underemployed during the next 3 years, working as contractor at random high tech companies that were busy bringing over even more Indians. One thing that was happening to me was that I was becoming increasingly delinquent without being aware of it. I wouldn't wake up in the mornings, shave, dress up, clean the house, pay the bills on time, wash the car, mow the lawn, etc. I was slowly becoming a cave man. Thanks to family members for intervening early, they helped me realize what was happening. The best advice I ever got was "an idle mind is the devil's workshop".

    At any rate, I am not trying to excuse the reckless behavior of poor people. I am just trying to share my own personal experience. This can happen to anyone.

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  15. RS - just to note that the Yanomamo, who behave much as you say, are not hunter gatherers but agrioculturalists (they are indeed addicted to tobacco!).

    People have to die of something. Starvation and violence (from other humans, or from animal predators) have been mentioned - the other main cause is parasitic and infectious disease.

    The Black Death killed around half the people in England (in several epidemic waves) and then the standard of living (per head) more than doubled - and remained elevated for a couple of hundred years.

    Another factor is age of death. In most historical societies, most mortality occured in childhood - especially young childhood:

    Journal of Social, Evolutionary, and Cultural Psychology
    www.jsecjournal.com - 2008,247
    IS CHILD DEATH THE CRUCIBLE OF HUMAN
    EVOLUTION?

    Tony Volk, Jeremy Atkinson

    Abstract
    Child death has played an important role in the evolution of humans. Of all stages of development, and at all historical times beyond Modern history, childhood has been associated with the highest levels of mortality. Compared to other evolutionary pressures such as surviving as an adult or finding a mate and having children, the odds of genetic failure (i.e., failure to directly contribute to one’s genetic line) are greatest in childhood. The enormous potential evolutionary pressure exerted by child death should have
    significantly influenced human psychological adaptations. Despite this potential influence, child death may be one of the least studied influences on human evolutionary psychology. This paper discusses the historical rates of child mortality, the relative odds associated with passing on one’s genes, adult mental adaptations to child mortality, and child mental adaptations to child mortality.

    http://137.140.1.71/jsec/articles/volume2/issue4/NEEPSvolkatkinson.pdf

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  16. They struggled to find enough money to give their children a good education. But they each had a television, a parabolic antenna, a DVD player, and a cell phone.

    I can't speak to Morocco specifically, but I can say that here in Afghanistan, cell phone service is considered one of the developmental success stories. From what I've read, this is pretty typical across the Third World. Cellular infrastructure, in contrast to, say, power and water, is relatively cheap and requires only minimal governance.

    Cell phones in Afghanistan are typically cheap Chinese knockoffs. Very few people here buy plans; most use prepaid SIM cards charged by the minute. The point being not buying electronic gimcrackery doesn't actually free up all that many resources for "sanitation and education".

    I also want to think a little harder about the extent to which Oucha Mbarbk could really trade his leisure time for "sanitation" -- by which I assume the writer means indoor plumbing. Indoor plumbing, even assuming he personally has access to and could afford the necessary PVC pipe fittings, etc. requires running water and a sewage system to connect to if it is going to work. Now, I suppose Oucha could dig a septic tank to replace (I'm guessing here) the open sewer he is presently using, but keep in mind that the marginal benefit to himself of doing so is quite small unless his neighbors build them as well.

    So really, these kind of quality of life issues are collective action problems, which goes directly to the lack of governance. If you want to argue that the failures of governance in places like Morocco is a function something intrinsic to the Moroccan people, I would agree, but to characterize them as a function of "poor choices" at the individual level is almost certainly an oversimplification. Morocco is not Detroit.

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  17. "So really, these kind of quality of life issues are collective action problems, which goes directly to the lack of governance."

    Which goes directly to WHY there is a lack of governance.

    There is a lack of governance because there's a lack of will to collective action and there's a lack of will to collective action because "collective" means clan or tribe. There is no concept of the idea of the greater good that extends beyond those limits.

    If an NGO delivers a pile of equipment and material to an area in preparation to build a sewage network, all the clan groups who were intended to benefit from it once built will swarm the site at night and steal everything to sell for the benefit of their own clan group.

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  18. Not really sure that a guy owning a TV and cell phone really says anything, since these things can be bought so cheaply these days. I doubt its an iPhone.

    That said, the overall point is definitley true. Go to any mall, and you will see lots of black people, totally out of representation to there actual numbers buying expensive clothes and shoes, when there obviously not rich.

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  19. Studies in India chow that the introduction of cellphones help raise the local GDP (they observed this as the introduction of cellphones was done zone by zone and the change of GDP followed the introduction).
    The reason in India was simple: local fishermen were able to call and know, before landing, where to go to sell their fish.
    In this case, the cellphone help them to know when and where there is work to do. The employers can find them more easily.

    The other choices are more debatable. But I'm unsure they could put up a sanitation if the local government start asking permits, bribes, etc. Sometimes this could attract unwanted attention.

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  20. I'm just overjoyed (and surprised) to have reached the end of Mangan's entry and all of the comments without someone attributing poverty to the lack of Christianity. Praise the Lord.

    The poor shall always be among you, incidentally, if that helps.

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  21. One of the nations in the "poverty trap" is China, which has an average daily caloric consumption of 2170 calories. I think this is more evidence that China, despite what is written, is likely not a universally high IQ country, outside of the large affluent metros and southeast.

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  22. " I think this is more evidence that China, despite what is written, is likely not a universally high IQ country, outside of the large affluent metros and southeast."

    Another possibility is that it's high IQ but very clannish outside the large urban centers.

    .

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  23. "One of the nations in the "poverty trap" is China, which has an average daily caloric consumption of 2170 calories. I think this is more evidence that China, despite what is written, is likely not a universally high IQ country, outside of the large affluent metros and southeast."

    China reminds me much more of the oppressed masses of Europe of yesteryear. That is the people have very good potential and when given opportunity, they do very well. The elites abuse them rather than realize that it is much more profitable to be kings of the rich than kings of the poor. Even if liberated Chinese could not perform as well the liberated Europeans, I still guess they could do a hell of a lot better than they do under the oppressive bastards of the Chinese elite.

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  24. Regarding oppression, is it possible to oppress the incompetent?

    I would characterize it more as exploitation. The American variant of slavery of Africans exploited their abilities by forcing them to be as productive as they could be. If they had not been sold into slavery in the US, they would have been less productive and would have been in more physical danger either for slave masters elsewhere or just living in their culture of constant tribal warfare and retaliation. Rather than waste their abilities, they were pressed into slavery and forced to produce. This is exploitation, not oppression.

    Oppression is the lack of opportunity that the highly selected Europeans endured. Despite their abilities, they were denied the opportunities to be more productive. The elites were not fully exploiting their productive capacity. Education and freedom made them more productive.

    Whereas the 'freedom' Africans had in their native lands made them less secure and less productive.

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  25. Anonymous: One of the nations in the "poverty trap" is China, which has an average daily caloric consumption of 2170 calories. I think this is more evidence that China, despite what is written, is likely not a universally high IQ country, outside of the large affluent metros and southeast.

    Maybe another possibility is that the Chinese for one reason or another prefer not getting too fat. And 2170 calories is a perfectly healthy daily average, especially for East Asians who apparently process food a bit more efficiently than Europeans.

    And over the last thirty-odd years, the overall Chinese population has gotten wealthier and improved its standard-of-living at just about the fastest sustained rate in the entire history of the world. So if they're stuck in some sort of "poverty trap," maybe we should figure out a way to sneak inside ourselves.

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  26. Mr. Sachs is welcome to spend any amount of his own money to help out the people of Africa. He is not entitled to spend my money to do it. We have lavished foreign aid on Africa for fifty years and the only thing it has produced is more africans.

    By the way, according to many critics, in the former Soviet Union in the early nineties, one of the leading causes of poverty was............Jeffrey Sachs.

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