Friday, November 16, 2012

Re-imagining Development

T has posted something on the topic of development, a question I have been grappling with for a while. She has posted a parable of a simple fisherman, lying on the beach, waiting for the fish to bite and  content with his lot.

The ultimate goal that everyone probably has is to end up like the fisherman on the beach. Unfortunately life is not quite so simple. Look around our own country, there are many poor and disaffected people, whether they are the displaced in the North/East or subsistence farmers in the South.

Development should be about creating opportunities or choices for people. They key word is opportunities-not handouts, not state jobs (handouts in another form) but real opportunities. A state job is only redistribution, some people are taxed and the money used to pay someone else.

Failure to create opportunities can lead to a tinderbox, witness the Arab spring and its fallout.

Sri Lanka's own tortured history of violence has its roots in the closing of opportunities - first to minorities and then, when no tangible benefits flowed, to rural youth. Witness the uprisings of 1971 and 1987.

At the moment, the innovative people of Sri Lanka are creating their own opportunities-by leaving in droves, to the Middle East and elsewhere, legally and illegally.

As long as we allow people to leave we will face no problems. If they are forced to stay back, either by diminishing opportunities aboard or ham-handed interception of human smuggling, then it is only a question of time before an explosion occurs, unless of course someone wakes up and realises the need to create opportunities.

What does the state need to do to create opportunities ? Certain social investment in education and health will help but the most important thing is to get out of the way; stop interfering in business or the economy, cut regulations and ensure justice prevails. In other words, reduce the size of the state and improve transparency and governance.

Why are poor countries poor? Time Harford has an explanation, which I have discussed here. Why did the Near East explode? Some thoughts here.

We have fifty or sixty years of development experience to draw on, since the first new states began to emerge from end of the second world war. The questions as to what can work and what does not have been largely answered, there is no need to look very far, one can draw as many useful lessons from the many failed experiments as from the few successes. The real tragedy is if we fail to learn anything from history, either ours or anyone else's. 

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