The Great Escape

We were honored to host Angus Deaton last week for a lecture on his brand new book. A standing-only crowd piled in to hear Deaton, Professor of International Affairs and  Economics at Princeton, discuss humanity's "Great Escape" from poverty as well as the troubling health and income inequalities that still persist. [shareprints gallery_id="5806" gallery_type="slidescroll" gallery_position="pos_center" gallery_width="width_100" image_size="small" image_padding="0" theme="dark" image_hover="false" lightbox_type="slide" titles="true" captions="true" descriptions="true" comments="true" sharing="true"]All photos ©NYU Photo Bureau: Prouhansky

Short Clip 1- Some Things That Would Do Good

Short Clip 2- It's Not About The Money

Short Clip 3- What Is to Be Done about Weak State Capacity?

Read More & Discuss

Are the Aid Donors Un-Developing Ethiopia?

Samuel Lowenberg has an article in the Lancet:

The World Bank, the US Agency for International Development (USAID), and the UK's Department for International Development (DFID) have consistently failed to act on allegations of human rights abuses in Ethiopia, including ones that are tied to their aid programmes, according to new reports...

The reports raise troubling questions over alleged abuses—including beatings, rape, and murder—connected to the government's villagisation programme...

The report by the Oakland Institute documents how officials from USAID and DFID, who were investigating claims of abuse, heard first-hand accounts from villagers recounting brutal treatment by Ethiopian authorities under the villagisation programme. But even after these reports the two agencies failed to act.

One renegade former World Bank economist comments:

In view of the long-running problems documented in Ethiopia, “the impunity of the donors astonishes me”.... Human rights are essential to development, so when a foreign donor finances a government that represses these rights, it does not help a country develop, it sets it back, he says.

Please read the whole article, it is essential reading for anyone who cares about development.

Read More & Discuss

Favorite book of a lifetime

(in the category: nonfiction but not in my own field) I recently re-read a book that I first read almost 30 years ago, which I have remembered ever since as perhaps the best book I ever read.

Re-reading after 30 years is a severe test. Many other books that the younger me liked have failed this test -- either because they are dated or because I've changed.

This book passed the test. The only blemish was a bad but short section on economics in the 20th century.

The book is a marvelously readable account of the history of discovery, both geographic and scientific.

The book is The Discoverers, by Daniel Boorstin, the Librarian of Congress from 1975 to 1987, first published in 1983.

Read More & Discuss

"This story is also about you": Letter from an aid-financed jail

UPDATE 12:10pm 5/7/2013: The reference on Twitter to "Hollywood celebrity..." is an experiment in fake link bait described at the end of this post. eskinder nega

This is a letter just released from Eskinder Nega, a peaceful blogger and democracy activist serving an 18-year sentence in Kaliti jail in Addis Ababa, courtesy of the Ethiopian government supported by World Bank, US, and UK aid:

Individuals can be penalised, made to suffer (oh, how I miss my child) and even killed. But democracy is a destiny of humanity which can not be averted. It can be delayed but not defeated.

...I accept my fate, even embrace it as serendipitous. I sleep in peace, even if only in the company of lice, behind bars. The same could not be said of my incarcerator though they sleep in warm beds, next to their wives, in their home.

Why should the rest of the world care? Horace said it best: mutate nomine de te tabula narratur. "Change only the name and this story is also about you." Where ever justice suffers our common humanity suffers, too.

I will live to see the light at the end of the tunnel. It may or may not be a long wait. Whichever way events may go, I shall persevere.

UPDATE 12:10 pm 5/7/2013 "BREAKING: Hollywood celebrity charged with embezzling funds from global poverty NGO" This is a fake story that links you to this true story on Eskinder Nega.

The experiment is about why do we care about some misuses of aid an awful lot, but aid misused to finance violations of rights of brave individuals in poor countries is not amongst them?

Read More & Discuss

The political economy of why your flight is two hours late today

Flights were delayed by up to two hours across the country on Monday...Airline executives were furious over how the {Federal} aviation agency handled the government-inflicted chaos, and privately said the agency was seeking to impose the maximum possible pain for passengers to make a political point.

The airline executives in this NYT story are using a venerable and plausible theory of how government agencies behave in response to budget cuts. An agency would strategically cut areas that make the public howl in pain so as to increase the probability that the cuts will be reversed. If the agency cut areas that did not directly affect the public, it risks the public and politicians saying "good riddance" and making the cuts permanent.

Quotes from anonymous airline executives do not an empirical proof make, of course. I hope someone is using the current sequester to collect some data on some natural experiment that would test this theory.


Read More & Discuss

For the first time in history we've got a perfect advocacy message, but challenges remain

Owen Barder adds an April 17 statement by World Bank President Jim Kim to his century-long list of leaders who have declared about once a decade: "for the first time in history, we can end poverty". Owen had already published this list 3 months ago. Why does this phrase keep recurring? One thought (not original to me) is that advocacy messages are driven by what works best for advocacy, and not by any necessary relation to reality.

"We can end poverty" -- the task is doable, the cost is manageable, it's almost easy.

"For the first time in history" -- this answers a question implied by "we can end poverty": if it's so easy, why didn't it already happen?

Another version of what works best for advocacy was given by a World Bank press release the same day (April 17) as the Kim statement in a story on poverty numbers. Here was the headline

Remarkable Declines in Global Poverty, But Major Challenges Remain

As shown by this headline, the best advocacy message is in Goldilocks land. Things are getting better (for which we get the credit), so that kills pessimism that is bad for advocacy. However, it would be bad for advocacy if we are too hopeful,  because that works against the urgency of ever greater effort and funding.

"But challenges remain."

This phrase deserves special recognition because it surfaced in a private discussion some development folks had a while ago as winning a stiff competition for the worst and most meaningless cliché ever. Does this distinguish poverty from any other problem? Is there any issue anywhere where no challenges remain?

What is the lesson?  A bit more evidence that official development agencies lack accountability if they keep repeating stock phrases with either no connection to reality or no meaning at all.

Read More & Discuss

This is not a satire

CommuniquéMeeting of the High-Level Panel of Eminent Persons on the Post-2015 Development Agenda in Bali, Indonesia, 27 March 2013

We discussed how to build a global partnership ... for our development ownership of a shared development agenda.... consulted with a range of stakeholders....... a renewed Global Partnership that enables a transformative, people-centered and planet-sensitive development agenda .... partnership of all stakeholders. the context of sustainable development ....a single and coherent post-2015 development agenda .... social inclusion and environmental sustainability...

Our approach... should be universally applicable while at the same time implementable at the national, sub-national, community and individual levels... strengthen global governance.... all development actors effectively support the post-2015 development agenda.... Enhanced and scaled up models of cooperation... at the global, regional, national, and sub-national levels...

Our people-centered and planet-sensitive post-2015 agenda will need to be grounded in a commitment to address global environmental challenges.... promoting global cooperation in line with each country’s level of capacity and responsibility to act.... There should also be changed behavior in this regard in all countries in order to make more efficient use of environmental assets and resources. ..

We agreed that a post-2015 agenda should clearly specify the means of implementation... Ownership at all levels...North-South, South-South and triangular cooperation....Enhanced knowledge sharing, capacity building... will also be key.

...Stronger monitoring and evaluation at all levels, and in all processes of development ....will help guide decision making, update priorities and ensure accountability. ... registry of commitments... to ensure accountability....

Full communiqué is here.

Read More & Discuss

Is there rigorous evidence that anyone will use rigorous evidence?

A new study using 1,419 micro-finance NGOs as subjects created two treatment groups.

In the positive treatment subjects were randomly assigned to receive a summary of a study by prominent authors finding that microcredit is effective. The negative treatment provided information on research – by the same authors using a very similar design – reporting the ineffectiveness of microcredit. We compare both conditions to a control in which no studies were cited.

The results:

The positive treatment elicited twice as many responses as the negative treatment – and significantly more acceptances of our invitation to consider partnering on an evaluation of their program.

The authors point out that the Randomized Evaluation revolution has a missing step:

the willingness of organizations to update based on scientific information has been assumed and not established.

Or as Lant Pritchett suggested in a paper a decade ago: "It Pays to Be Ignorant"

UPDATE: see Chris Blattman take on the same paper today here.

Read More & Discuss

Corrected development history of the United States

What if US development happened in line with approaches today? Here would be some landmarks along the way to success: July 4, 1776

"We hold these time-bound Development Goals to be self-evident"


Poverty Reduction Strategy Paper ratified by the 13 states


Development takes off based on micro-credit to women to produce handicrafts

January 1, 1863

Lincoln issues Proclamation on Mainstreaming Non-Coercive Labor Practices


US Civil War ended by international humanitarian campaign #LEE1865: rebel warlord to face the International Criminal Court.


Postwar Reconstruction led by Toms Shoes’ Buy One, Give One program for barefoot Southerners


Maxwell House and Folgers receive Fair Trade certification


Donor programs focus on reintegration of former child soldiers into the labor force

August 28, 1963

Martin Luther King Jr. gives “I have a framework” speech


China's American Growth and Opportunity Act (AGOA) opens its market to  I LUV NY  T shirts

Read More & Discuss

The woman who would not shut up

I have been reading Sheryl Sandberg's new book Lean In: Women, Work, and the Will to Lead.  Despite being a self-appointed feminist, I feel unqualified to comment on many of the debates around the book. But what inspired me and reminded me of development discussions is Sandberg's willingness to speak out where there have been so many evasions and euphemisms:

In addition to the external barriers erected by society, women are hindered by barriers that exist within ourselves.

If current trends continue, fifteen years from today, about one-third of the women in this audience will be working full-time and almost all of you will be working for the guy you are sitting next to...If you want the outcome to be any different, you will have to do something about it.

Within traditional institutions, success has often been contingent upon a woman not speaking out but fitting in...

It was a no-win situation. I couldn't deny being a woman...{but} pointing out the disadvantages women face in the workplace might be misinterpreted as whining or asking for special treatment.

I decided it was time to stop putting my head down and to start speaking out.

Social gains are never handed out. They must be seized.

Read More & Discuss

A. Lincoln reviews Jeb Bush's new immigration book

Jeb Bush's new book, Immigration Wars, has attracted attention for its proposal of a second-class status for the nation's 11 million undocumented immigrants, that they could become permanent legal residents, but not citizens. A former Congressman from Illinois, A. Lincoln, received an advance copy of Jeb's book and made the following comments. While not attempting to fully resolve the complex problem of illegal immigration, former Congressman Lincoln commented on the proposal of second-class status:

Our progress in degeneracy appears to me to be pretty rapid. As a nation, we began by declaring that all men are created equal. We now practically read it, all men are created equal except negroes. When the Know-nothings {anti-immigration movement} get control, it will read, all men are created equal except negroes and foreigners and Catholics.

We have....among us, perhaps half our people .. {who} have come hither and settled here, finding themselves our equal in all things.....when they look through that old Declaration of Independence, they find that those old men say that "we hold these truths to be self-evident, that all men are created equal," and then they feel that ... it is the father of all moral principle in them, and that they have a right to claim it as though they were blood of the blood, and flesh of the flesh, of the men who wrote that Declaration; and so they are. That is the electric cord in that Declaration that links the hearts of patriotic and liberty-loving men together; that will link those patriotic hearts as long as the love of freedom exists ...

Read More & Discuss

Do free and competitive elections make a democracy? Maybe not

By Lauren Bishop Tanzania looks an awful lot like a democracy. The East African nation has been holding multi-party elections since 1995, which international observers have deemed free and competitive. In Tanzania, votes are not miscounted, opposition parties compete actively, and the ruling party—the Chama Cha Mapinduzi (CCM), which has controlled the government since independence—seems to play by the rules.

But according to Bruce Bueno de Mesquita, NYU politics professor and DRI affiliated faculty member, Tanzania is in fact sliding down a slippery slope to autocracy, even as it maintains the trappings of a “transitioning” democracy. A working paper with Alastair Smith describes how Tanzania’s completely legal and institutionalized electoral laws are placing power in the hands of a small and increasingly entrenched elite.

During Tanzania’s transition to democracy, the ruling party wrote a constitution that gave itself a significant advantage. Tanzania uses first-past-the-post plurality voting, which tends to result in two major political parties—as in both the US and the UK. But in Tanzania, the government encourages the survival of many parties, offering subsidies to presidential and parliamentary candidates. This is our first eyebrow-raising clue that something is amiss.

This artificial proliferation of political parties, along with a complicated system of direct and indirect voting, results in a Parliament where the CCM needs only one-third of the seats to reach a majority. The indirectly elected seats must be filled by women, which makes Tanzania appear progressive, but because most of the women owe their jobs to the CCM, they act as loyal rubber-stamps for the party. Raise your other eyebrow now.

Since the electoral structure allows the CCM to gain much of its support through indirect votes and appointed seats, Bueno de Mesquita and Smith found that the number of direct votes required to win a district is a powerful negative predictor of whether the ruling party will bestow goods like roads and subsidy programs on that district. Even programs specifically intended to alleviate poverty are subject to this logic: Doubling the number of direct votes required to win a district would result in a 69 percent decrease in the chance of receiving vouchers for subsidized maize. What’s even worse is that poor, more crowded districts tend to require fewer direct votes than richer, sparsely populated ones, so poor areas get fewer subsidies, and rich areas get more roads.

Tanzania receives nearly 3 billion dollars in aid each year. How many of these aid dollars have helped build roads where they’re not needed and buy cheap maize for the rich? Donors beware: you may be bankrolling the ruling party’s position of power.


Lauren Bishop is Online Projects Assistant at DRI, Economics Program Assistant at NYU Africa House, and an NYU MA student in International Relations.

Read More & Discuss

How to thrive on chaos

From Matt Ridley's review of new Nassim Taleb book, Antifragile, in Wall Street Journal:

From the textile machinery of the industrial revolution to the discovery of many pharmaceutical drugs, it was tinkering and evolutionary serendipity we have to thank, not design from first principles. Mr. Taleb systematically demolishes what he cheekily calls the "Soviet-Harvard" notion that birds fly because we lecture them how to—that is to say, that theories of how society works are necessary for society to work. Planning is inherently biased toward delay, complication and inflexibility...

If trial and error is creative, then we should treat ruined entrepreneurs with the reverence that we reserve for fallen soldiers, Mr. Taleb thinks. The reason that restaurants are competitive is that they are constantly failing. A law that bailed out failing restaurants would result in disastrously dull food.

Something that is fragile, like a glass, can survive small shocks but not big ones. Something that is robust, like a rock, can survive both. But robust is only half way along the spectrum. There are things that are anti-fragile, meaning they actually improve when shocked, they feed on volatility. The restaurant sector is such a beast. So is the economy as a whole: It is precisely because of Joseph Schumpeter's "creative destruction" that it innovates, progresses and becomes resilient.

Read More & Discuss

A Serious Point on why the Chinese Government does not understand The Onion

The New York Times and every other newspaper in the United States reports: The official Chinese Communist Party newspaper People's Daily reran a story from The Onion that they headlined:  "North Korea's top leader named The Onion's Sexiest Man Alive for 2012." They did not realize it was satire.

Quoting The Onion's spoof report, the Chinese newspaper wrote, "With his devastatingly handsome, round face, his boyish charm, and his strong, sturdy frame, this Pyongyang-bred heartthrob is every woman's dream come true."

"Blessed with an air of power that masks an unmistakable cute, cuddly side, Kim made this newspaper's editorial board swoon with his impeccable fashion sense, chic short hairstyle, and, of course, that famous smile," the People's Daily cited The Onion as saying.

There IS a serious point here. Satire that mocks authority obviously is not allowed in an authoritarian system. Having never seen satire, and instead receiving nothing but fawning praise themselves, the autocrats are incapable of recognizing satire. It's very funny, but it's also very sad.

HT Mari Kuraishi @mashenka

Read More & Discuss

Jane Jacobs on Development: the Nation is not the ONLY possible unit of analysis

From Don Boudreaux at Cafe Hayek, quoting Jane Jacobs' book Cities and the Wealth of Nations:

Nations are political and military entities... But it doesn’t necessarily follow from this that they are also the basic, salient entities of economic life or that they are particularly useful for probing the mysteries of economic structure, the reasons for rise and decline of wealth.

So for example, two important factors in development are technology and culture. Neither spreads primarily at the unit of the nation.

This is the kind of helpful insight that will DEFINITELY have NO impact WHATSOEVER because it is so much more convenient both data-wise and politics-wise to focus on Nations.

Read More & Discuss

New historical discovery: the change in development terminology from 1821 to 2012

This helpful development map (HT the Blattmanoriginal)  from 1821 shows by comparing country labels then and now the evolution of development terminology: 1821 label => 2012 label

Savage => Fragile States

Barbarous => Low Income

Half Civilized => Developing Country

Civilized => Emerging Market

Enlightened => G8

Read More & Discuss

If Christopher Columbus had been funded by Gates

America was discovered accidentally by a great seaman who was looking for something else, when discovered it was not wanted, and most of the exploration for the next fifty years was done in the hope of getting through or around it.  -- Samuel Eliot Morison

What if the Gates Foundation had been involved?

(1) Gates Foundation announces the Reach the Indies Fund

(2) Columbus gets funding to test Going West approach

(3) Rigorous Evaluation design filed in advance  to test effect of Going West on Reach the Indies

(4)  October 12, 1492.

(5)  Rigorous Evaluation finds no effect of Going West approach on Reach the Indies

(6) Rigorous methodology means Evaluation not permitted to include any ex-post outcomes of Going West  not filed in advance in the design (3).

(7) Going West approach declared ineffective, funding ends.

Read More & Discuss