02 February 2011

The China Problem

"Alright then smart-arse, if democracy is so good for development, then what about China eh?"

Well, I see your canny Rodrik-rebuttal and raise you......more Rodrik.....who I will quote at length.
For every Lee Kuan Yew of Singapore, there are many like Mobutu Sese Seko of the Congo.
Democracies not only out-perform dictatorships when it comes to long-term economic growth, but also outdo them in several other important respects. They provide much greater economic stability, measured by the ups and downs of the business cycle. They are better at adjusting to external economic shocks (such as terms-of-trade declines or sudden stops in capital inflows). They generate more investment in human capital – health and education. And they produce more equitable societies.
Authoritarian regimes, by contrast, ultimately produce economies that are as fragile as their political systems. Their economic potency, when it exists, rests on the strength of individual leaders, or on favorable but temporary circumstances. They cannot aspire to continued economic innovation or to global economic leadership.
At first sight, China seems to be an exception. Since the late 1970’s, following the end of Mao’s disastrous experiments, China has done extremely well, experiencing unparalleled rates of economic growth. Even though it has democratized some of its local decision-making, the Chinese Communist Party maintains a tight grip on national politics and the human-rights picture is marred by frequent abuses.
But China also remains a comparatively poor country. Its future economic progress depends in no small part on whether it manages to open its political system to competition, in much the same way that it has opened up its economy. Without this transformation, the lack of institutionalized mechanisms for voicing and organizing dissent will eventually produce conflicts that will overwhelm the capacity of the regime to suppress. Political stability and economic growth will both suffer.
Absolutely worth reading in full; The Myth of Authoritarian Growth.

All of which is completely besides my original point, which I will paraphrase as such; we know very little about how to take developed societies to where the poor people are, but we know a great deal about how to bring the poor people to where the developed societies are*, and yet we spend the majority of our time thinking about the former. 

*It's really pretty easy. A boat. Or a plane.

**If you noticed my use of TWO semicolons within the space of TWO sentences there, well this is absolutely to blame.


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