A perspective on economic development

We seek to change or improve things. We look at things in a big picture but we fail to connect the least dots that actually make this big picture. We are obsessed with the idea of democracy (free and fair elections and all its children). We see democracy as a  panacea for everything. Our big picture is just this democracy which we think will bring us the economic development we wish to earn. We are obscured on the fundamental things which lead to both democracy and economic development.

We get bogged down with democracy and forget that, among other things which can be found elsewhere, especially with regard to countries that have the least levels of literacy of the world, it has not managed to meet the expectations of their poorest citizens. Countries such as South Korea and Vietnam enjoy the economic development they have reached today because they put an emphasis on expanding access to education and basic health care of their citizens from early on.

To these countries a special treatment of democracy makes more sense and is really practical to them now because — I will mention one thing — of their already richness in human resources. Richness in human resources is arguably “constructive” of any economic development and democracy. We can also offer some, perhaps contrasting, examples of countries such as Botswana and India, which have emphasised on democracy and, it’s true, they are quite good with their level of economic development, but I shall refrain from scrutinizing this in this article for I want to emphasise on the point that there needs to be a change in what we see as “constructive of economic development.”

I am arguing for an obsession for economic development.

Economic development must be a planned process. Suppose today we viewed it as a body just like a human body. It has its own constitutive parts: head, legs and hands to human body, and, education, basic health care, accessibility to energy and justice to economic development. We identify these little parts as sub-problems that must be solved in order to solve the equation of  economic development.

Our problem would then reduce to solving these little sub-problems. If we looked at it this way we would realize that a solution to one problem directly or indirectly would contribute to the solution of the other. For example the sub-problem of providing a greater access to energy has an inestimable potential to powering economic growth. Energy would provide electricity for domestic use (for cooking, lighting etc.), water pumping (for drinking and irrigation), use in hospitals and schools which would enable them to employ modern equipments in their methods.

It has been discussed elsewhere that “individuals who are healthier have higher returns to labor input and they will have the incentive to invest in education as the time horizon over which returns can be earned is extended. Education is the driver of economic growth.” The (economic) returns of access to energy therefore would power economic development up of these communities in a significant way.

As we invest in solving these sub-problems we must make sure that every solution does not lead to other (and ultimately more complicated) problems. For example, if we chose to use coal or nuclear energy to light our cities and provide energy for industries, a question should be what implications would this have to the environment, and the benefits of it to  future generations? (Of course in this case we might be tempted to say, “well, to establish coal or nuclear plants is cheaper than using other alternative sources of energy and their rich in energy could provide energy for many years.” One worth question to ask ourselves in doing such analysis is: What are our options? Cost vs. adverse impacts.).

Another example is what would the implications on our food security be if we chose to invest in biofuels instead of coal/nuclear energy? As we look at our sub-problems, and for the case of creating a more literate society a question should be: Are our education systems aiming at creating independent and creative minds that can help advance humanity but not people who would only end up enjoying the benefits of working for banks, governments, or other established institutions. Are they going to solve our most challenging problems?

I would want to get obsessed with looking at economic development as a planned process that calls for alleviation of the fundamental problems the poorest face through a development of simple solutions. I would like us to emphasize less on preaching about democracy but more on addressing these and similar sub-problems. In this light I shall offer two examples.

One is: Ensure that every citizen has a basic health care service — absence of malaria, typhoid, cholera and other diseases and access to medication in case of disease. Two is: Provide access to energy for every citizen at a price affordable to them for basic uses such as lighting homes, for schools and hospitals.

Solutions to all these are within our reach and can be achieved in a shortest strategized time period. I am confident that democracy, which without doubt is crucial for expanding the freedoms of every individual, will be achieved along the way. (Freedom here refers to the expansion of political rights — e.g. freedom of expression, economic rights — e.g. right to exchange and free trade, and so on.)