My Beauty Best Teacher

Bill Easterly responds to Bill Gates's "Creative Capitalism",he states :

That traditional capitalism has been the single successful driver of true poverty reduction and that, while it may not function as fast or as equally as we would like, it is the only solution that will work. In Easterly's mind, Gates was proposing a 'new' capitalism where corporate philanthropists would be recognized for supplying goods to the poor - a solution with weak incentives and a low likelihood of success.

Chris Blattman writes and asks for suggestions:

That's the (informal) course title for my spring undergraduate lecture. Turns out that's too long and rambling a name for a transcript, and so the Yale powers that be had me shorten it to the duller, "African Poverty and Western Aid"...What can the West do? The course has students read the new canon of development: Sachs, Collier, Easterly, Rodrik, etc. Putting it together, I was struck with the preponderance of rich white male academics. Don't get me wrong. I aspire to be a rich white male academic myself (I am 3 for 4--and only held back from that goal by the preponderance of student debt). But it would be nice to have other perspectives.

So the course is now set up to read other points of view--mostly, admittedly, rich black male perspectives--and think critically about the new canon. Ayittey, Ake, Ekeh, Sawyer. Mamdani, Ndulu, Wainaina. Mwenda, Mkandawire and Soludo. And some optional Franz Fanon, just to appease Chris Udry...[continue reading]

Cameroon becomes a tourism destination-Global Voices
"Copycat Dictators and Cartoon Democracies..." Alemayehu G. Mariam in Ethiopian Review
"Formal education is not advancing Africa"-Nana Yaw Asiedu
Ivory Coast's descent into madness-Richard Dowden
Taking a look at Land 'Grabs' in Africa-African Arguments
African Export Successes by William Easterly & Ariell Reshef

The PSD Blog reports on a Bill Easterly paper (pdf) that questions those who set the MDG goals in the first place,he concludes that.

It seems undesirable to exaggerate the “Africa as failure” image, which in turn exaggerates the role of “the West as Savior” for Africa (as the MDG campaign has often played out in practice). It is demoralizing to have goals for Africa that only be attained with progress that is nearly without historical precedent from other regions or in Africa itself. Africa has enough problems without international organizations and campaigners downplaying African progress when it happens.

From the Council for Foreign Relations Stephanie Hanson writes:

A small group of economists now argue that brain drain might have a positive impact on Africa. Those skilled workers, their research shows, are often sending significant quantities of money back to their home countries. A March 2008 paper by economists William Easterly and Yaw Nyarko says remittances to Africa are likely undercounted, but on average they are equivalent to 81 percent of the foreign aid (PDF) received by an individual country. A 2005 World Bank study showed that remittances from skilled workers to their families in Guatemala, Mexico, and the Philippines helped reduce poverty in those countries.
In some cases, talented workers are even returning to their home countries to work or start businesses. Though research on this phenomenon in Africa is limited, economists have documented the effects of Chinese and Indian tech entrepreneurs returning to their home countries. This so-called brain circulation—in which entrepreneurs start new companies but maintain business links in the United States—has been extensively researched by Anna Lee Saxenian of the University of California, who calls these entrepreneurs "The New Argonauts." Some experts believe African skilled workers could have a similar positive effect on their native economies...[continue reading]

William Easterly writes on the rebirth of utopianism"...it is in 2005 that utopia seems to have made its big breakthrough into mainstream discourse. In March, Columbia University Professor Jeffrey Sachs, celebrity economist and intellectual leader of the utopians, published a book called The End of Poverty, in which he called for a big push of increased foreign aid to meet the Millennium Development Goals and end the miseries of the poor...British Chancellor of the Exchequer Gordon Brown likewise called in January for a major increase in aid, a “Marshall Plan” for Africa. Brown was so confident he knew how to save the world’s poor that he even called for borrowing against future aid commitments to finance massive increases in aid today...We have already seen the failure of comprehensive utopian packages in the last two decades: the failure of “shock therapy” to convert the former Soviet Union from communism to capitalism and the failure of IMF/World Bank “structural adjustment” to transform nations in Africa, the Middle East, and Latin America into free-market paragons. All of these regions have suffered from poor economic growth since utopian efforts began...With all the political and popular support for such ambitious programs, why then do comprehensive packages almost always fail to accomplish much good, much less attain Utopia? They get the political and economic incentives all wrong. The biggest problem is that the rich people paying the bills do not share the same goals as the poor people they are trying to help...ree markets and democracy are far from an overnight solution to poverty—they require among many other things the bottom-up evolution of the rules of the game, including contract enforcement and fair political competition. Nor can democratic capitalism be imposed by outsiders (as the World Bank, IMF, and U.S. Army should now have learned). The evolution of markets and democracy took many decades in rich countries, and it did not happen through “big pushes” by outsiders...The problems of the poor nations have deep institutional roots at home, where markets don’t work well and politicians and civil servants aren’t accountable to their citizens. That makes utopian plans even more starry-eyed, as the “big push” must ultimately rely on dysfunctional local institutions..."
Via Bullets and Honey

Bill Easterly contends that to solve development challenges "problem-solving systems" must be be in existence. This assertion has been on this blog and Timbuktu Chronicles under a number of guises. Be it evolving the culture; informal industrial clusters;startup; ecosystems; etc. Societies that do not evolve autocatalytic,sustainable methods of overcoming their challenges will remain moribund,regardless the level of external intervention:

Development happens thanks to problem-solving systems. To vastly oversimplify for illustrative purposes, the market is a decentralized (private) problem solving system with rich feedback and accountability. Democracy, civil liberties, free speech, protection of rights of dissidents and activists is a decentralized (public) problem solving system with (imperfect) feedback and accountability. Individual liberty in general fosters systems that allow many different individuals to use their particular local knowledge and expertise to attempt many different independent trials at solutions. When you have a large number of independent trials, the probability of solutions goes way up.

Peter Montiel reviews Reinventing Foreign Aid Edited by William Easterly Foreword by Nancy Birdsall:

It is ironic that, at a time when aid flows to the poorest countries of the world are reaching unprecedented scale, and when the challenge of generating resources to fight world poverty is receiving unprecedented public attention, the question of what actually works in making aid effective has become extremely controversial. Fortunately, a new generation of development researchers has turned its attention to this question, bringing to bear a variety of innovative and refreshingly convincing new empirical techniques

William Easterly in the Washington Post writes.
"...Economic development in Africa will depend -- as it has elsewhere and throughout the history of the modern world -- on the success of private-sector entrepreneurs, social entrepreneurs and African political reformers. It will not depend on the activities of patronizing, bureaucratic, unaccountable and poorly informed outsiders…Development everywhere is homegrown..."
via PSDBlog

Roben Farzad writes in Businessweek:

In many ways, Africa's economic situation seems hopeless. While $625 billion in foreign aid has poured in since 1960, there has been no rise in the region's per capita gross domestic product, notes William R. Easterly, economics professor at New York University. What's more, from 1976 to 2000, Africa's share of global trade dropped to 1%, from an already negligible 3%. The U.N.'s scale of human development, which considers health, education, and economic well-being, ranks 34 African nations among the world's 40 lowest. Thus far, foreign aid hasn't made a dent.
Greed, however, might. Thanks to the global commodities boom of the past few years, sub-Saharan Africa's economies, after decades of stagnation, are expanding by an average of 6% annually—twice the U.S. pace. And like bees to honey, investors are swarming into the region in search of the enormous returns that ultra-early-stage investments can bring. Blue Financial, for example, has already netted its early private equity backers a ninefold gain thanks to the 385% rise in its stock since its October, 2006, initial public offering in Johannesburg. Emerging Capital Partners has bought all or part of 42 African companies this decade and cashed out of 18, with gains on their investments averaging 300%. "The money we can make is matchless," says Emerging Capital Partners CEO Thomas R. Gibian, a former Goldman Sachs (GS) banker.

William Easterly questions the role of "development experts" he asks?:

Where are the experts who guessed in advance that an obscure Indian company making edible oils would become a $10bn-plus company (Wipro) providing information technology services and call centres? Or that a lossmaking Brazilian state enterprise (Embraer) would go on to capture a lot of the world market for regional jets after being privatised? Or that South Korean entrepreneurs would create a carmaker (Hyundai) with greater market value than General Motors or Ford? Or that a schoolteacher named Dong Ying Hong, formerly earning $9 a month in Datang, China, would become a millionaire making socks?

What to do in a world of such unpredictability? There are some general principles and they do not require experts. Another Nobel laureate gave the crucial insight a long time ago – the answer is freedom for multitudinous individuals to figure out their own answers. Friedrich Hayek said: “Liberty is essential to leave room for the unforeseeable and unpredictable; we want it because we have learned to expect from it the opportunity of realising many of our aims. It is because every individual knows so little and ... because we rarely know which of us knows best that we trust the independent and competitive efforts of many to induce the emergence of what we shall want when we see it.”

William Easterly writes:

Like all ideologies, Development promises a comprehensive final answer to all of society’s problems, from poverty and illiteracy to violence and despotic rulers. It shares the common ideological characteristic of suggesting there is only one correct answer, and it tolerates little dissent. It deduces this unique answer for everyone from a general theory that purports to apply to everyone, everywhere. There’s no need to involve local actors who reap its costs and benefits. Development even has its own intelligentsia, made up of experts at the International Monetary Fund (IMF), World Bank, and United Nations.

Suzy Hansen interviews William Easterly author of The White Man's Burden .In an answer to a question about aid being an effort to rectify the effects of colonialism he states "...I don't think aid is a nefarious conspiracy to keep control in countries that used to be colonies. But it is part of the kind of colonial mind-set that has persisted. Kipling's "white man's burden" saw colonials as these benign white people bringing civilization to these people. It was put in much more p.c. language and became "foreign aid," but still with rich, white people in charge thinking they knew the answers. There certainly isn't the overt racism as before, but there is paternalism...

Enterprise Africa held a panel discussion on "Fighting Poverty through Entrepreneurship in Africa". Speakers included William Easterly,Peter Boettke and Temba Nolutshungu Watch videos part1 part2 part3 and part4 (right-click and save)

Bill Easterly sounds a note of caution in FP:

For Jeffrey Sachs the crash is an opportunity to gain support for the hopelessly utopian Millennium Development Goals of reducing poverty, achieving gender equality, and improving the general state of the planet through a centrally planned, government-led Big Push. “The US could find $700 billion for a bailout of its corrupt and errant banks but couldn’t find a small fraction of that for the world’s poor and dying,” he wrote in September. “The laggards in the struggle for the [goals] are not the poor countries ... the laggards are the rich world.” To Sachs and his acolytes, poor people can’t prosper without Western-country plans—and the crash only serves to turn Western governments inward. Therefore, progress on poverty is bound to suffer...[continue reading]

William Easterly writes in the Guardian:

Image via Wikipedia

A popular topic in the aid blogosphere this week was not about Haiti or Ivory Coast or south Sudan but about complex systems, ie systems that cannot be reduced to a simple mathematical or statistical model, where actions often have unintended effects. Yet this seemingly abstruse topic has surprising relevance to the Ivory Coast debate (and perhaps the others as well). One would want to be very careful making aggressive recommendations in a complex system whose principles are not very well understood.
Civil conflict is a great candidate for such an irreducibly unpredictable system. Civil conflict features political and military leaders on both sides, the general population is divided, and each side of the population contains an array of different interest groups. For every move by one player, there will be counter-moves by the other players, then counter-moves to the counter-moves, and so on...[continue reading]

Victor Konde founder of the ATDF writes:

Governments have to provide some learning and experimentation space for creative ideas. Mr William Easterly argues that there are two types of approaches to development: “planners” and “searchers.”
Planners, mainly from the developed countries, have ambitious schemes, experienced development economists, serve as experts and financiers and greatly influence government policies of recipient countries — where possible backed by conditions.
Searchers, on the other hand, are often talented locals or returnees with good unproven ideas, often outside official government channels, with limited support.
The planners get most of the attention as they champion one “new big idea” after another. No one knows what searchers exist or champion until the projects, if they managed to get support, become successful.
Promoting entrepreneurship may require provision of support for individuals willing to test innovative concepts.

In a recent interview development expert William Easterly stated "...Securing pledges for more aid is not going to make poverty history. What we should be examining is the aid industry’s plans to spend this new money because it has a track record of failure dating back to the 1940s and 50s. There’s been numerous and diverse attempts to buy the poor out of poverty but none of them have been particularly successful. So in 2005 we found ourselves ostensibly throwing more good money after bad. Above all, this is tragic for the poor...“There might be one billion people living on a dollar day but they are not a political constituency - they have no voice. They are effectively customers of this multi-billion dollar aid industry but lack the ability to give feedback and influence the type of aid they receive...At the same time, aid industry investors – rich country tax payers and the politicians writing the cheques – are ill-informed and far removed from the lives and daily challenges of the world’s poor. Therefore the disconnect that resides at either end of the development supply chain mitigates against change and reform to deliver the type of development the poor so desperately want and need..."
Via NextBillion