Saturday, May 15, 2010

Week 20: The Bottom Billion




Paul Collier is a professor of economics at Oxford and directs the Center for the Study of African Economies. Here, he addresses the problem of the very poorest countries--the ones we call failing states, that are not becoming wealthier with the rest of the world because they are caught in various traps. There are about a billion people in these countries, so one-sixth of the world population is stuck in dire poverty that is not improving.

Collier identifies four major "traps" that keep the bottom billion down:
  • Conflict: usually recurring civil wars
  • Natural resources: if a country has a single valuable resource like oil or diamonds it can work against prosperity
  • Being landlocked with bad neighbors: with no ports, a country needs its neighbors to have good roads and good government in order to export products
  • Bad governance in a small country: corruption!

He discusses current aid policy and examines what works, and what doesn't. It becomes clear that if we want to help these failing states, we need to stop emotional, aimless money-throwing and analyze what truly works. Many fairly simple strategies are overlooked, and often we are simply pursuing less-effective (or even counter-effective) measures that need some tweaking in order to work much better. A few specific issues he explores in-depth are international aid, military intervention, international laws and standards, and global trade policy. How these instruments work--and fail to work, and could work better--makes for some interesting (if slow) reading.

This is an excellent book to study as part of learning about issues of global poverty and how wealthy nations can help the poorest ones get on board.

No comments: