“Political independence is of little value without economic development. It was the task of our leaders in the past to work for political autonomy but now, that it has been accomplished, it is incumbent on the youth to make independence real by economic self-sufficiency...”—
Conrado Benitez (1889-1971), one of the framers of the Philippine Commonwealth Constitution, and was the former dean of the University of the Philippines.
Self-sustainability is true independence. A true test of our self-sufficiency is our 7Eleven Philippines. If more than half of the said convenient store’s products are made in the country or were made by Filipino companies, we are truly self-sustaining and therefore we can stand on our own two feet. Unfortunately this is not so.
Pakistan's Middle Class Extremists
Most policymakers makers believe that the poor are more susceptible to the appeals of violent groups. Counterterrorism policies have therefore often centered on economic development. In Pakistan, however, it is the middle class that is supportive of militant groups. What does this mean for counterterrorism strategy?
Read the article here.
What is economic development?
Every Monday I will publish a column on Economic Development. The aim of this column is to identify the sources of economic growth and propose solutions to development challenges around the world. More specifically my aim is to propose solutions to the economic challenges of the least developed countries in the world. These countries are mostly located in Africa, Latin, America and Asia. What do we understand by economic development?
Economic development is the process by which we generate the resources to meet the essential needs that enhance our human experience. I will focus my analyses on three basic economic goods that are a key ingredient of economic development: health, education, and income. These essential goods are statistical components of the Human Development Index (HDI) which is used as a benchmark to evaluate the quality of life in nations around the world. (To be precise, the HDI uses adult literacy, life expectancy, and gross national income per capita as proxies for Health, Education, and income. According to Wikipedia, the HDI was developed by Mahbub Ul Haq, alongside others, based on Amartya Sen’s capabilities approach). Why health, education, and income per capita?
Throughout ages, and across the globe, people want to live longer and healthier. It is therefore natural to include health as a key ingredient of development. As soon as Man can talk he starts searching for panacea.
Throughout human history and civilization, people have sought to expand their knowledge of the world around them and themselves. Prior to the advent of the scientific method, the distinction between knowledge and beliefs was blurry. Since then, we consider knowledge as justified true belief. The justification comes from demonstrating a belief as true using generally accepted methods of inquiry, proof, and demonstration within various disciplines. Philosophers demonstrate, mathematicians prove, scientist repeat experiments under a rigorous set of assumptions, and social scientists hypothesize… By understanding the world around us, we improve the quality of our life and by understanding ourselves as Humans, we find better ways to interact with each other and reap greater benefits from social collaboration.
Income is essential for a good life, because it allows us to procure ourselves goods and services that enhance our utility. I understand income as the value of our production that we exchange for other people’s creations to meet our wants and needs, and pursue what we value in life. If I had more income, this blog entry would be longer.
There are multiple other goods that are universally valued but that I do not include in economic development, because they are not as easily quantifiable. Economics is the discipline that deals with the allocation of scarce resources to satisfy our needs. Analyses of allocation are most easily done with quantifiable means and ends. Happiness is a universal good, but cannot be easily quantified. We can scale happiness nominally, and have no common benchmark to measure happiness from one person to another.
Before we propose ideas that promote development, we will familiarize ourselves with some of the greatest insights of the economic analysis of development. I will introduce these ideas over the next few months by highlighting some of the contributions of my favorite development economists. This list is not exhaustive. There are more great thinkers than I can acknowledge, due to my limited time resource and knowledge. In no rigorous order, I will discuss the contributions of Adam Smith, David Ricardo, John Maynard Keynes, Roy Harrod and Evsey Dommar, Robert Solow, Robert Lucas, Garry Becker, Amartya Sen, Douglass North, and Jeffrey Sachs. That should keep us busy until summer.
As we discuss the contributions of these eminent minds to the field of economic development, I will also refer to some of their “accessible” work for a lay audience. Keep reading, and feel free to comment. Your feedback is always welcome.
"The Next Metro Economy"
All week Atlantic Cities’ project has pushed out some great work from Bruce Katz (Brookings) and Judith Rodin (Rockefeller Foundation) in “The Next Metro Economy”. “The Next Metro Economy” is a special report from the Brookings-Rockefeller Project on State and Metropolitan Innovation looking at state, local, and regional efforts to revitalize our stagnant economy.
Today’s piece on New York and Governor Andrew Cuomo’s program to create competition among regions of NY for development projects is an excellent read. Here’s a brief overview of the competition:
These councils were given just over three months to create strategic plans that articulated a vision for regional economic development, outlined the implementation process, identified available resources, and established performance metrics. These strategic plans were then judged by a panel of experts, who selected the winning plans and determined how much state funding each region would receive.
In fact, my home geographic locale (North Country) was chosen as one of the four winners.
Four regions won the title “best plan” in the competition, which came with a state investment of just over $100 million each… North Country included an emphasis on high-tech and traditional manufacturing and green energy production as well as investments in area railways, broadband access and medical research.
You can read their full proposal here. For a place that has been long propped up by Fort Drum, state prisons, and a small amount of industry that has slowly moved out over the years, this is certainly a big win for the North Country and its constituents.