Rwanda Could Thrive Faster by Putting (Even) More Women in Charge

Rwanda has the largest share of female parliamentarians of any country in the world. But things in Rwanda seldom sit still, and it is time to start going faster and further. 

Rwanda’s impressive female representation in national politics is not yet replicated at the local level. Only eight of the thirty district mayors in Rwanda (twenty-seven percent) are women, and just thirteen percent of village leaders are women.

Me in The Kigalian

The new childcare subsidy in the UK

The IFS:

"Today’s announcements indicate that the Government’s main motive is to help parents move into work. As we pointed out in the IFS 2014 Green Budget, we know remarkably little about the impact of the policies to support childcare that have been introduced in England in recent years. And there is no consistent evidence from other countries that childcare support has large effects on parental labour supply. While today’s announcements bring welcome simplifications to the new Tax-Free Childcare scheme, and an increase in generosity that will certainly be welcomed by families on Universal Credit using childcare, and better-off families who spend more than £6,000 a year on childcare, the extent to which it will deliver its intended goals is essentially unknown."

and Chris Dillow:

"It's fitting that Nick Clegg should have announced an increase in the state subsidy for childcare, because the policy is a sanctimonious front for something that is inegalitarian and economically illiterate."

On Immigration

I need to get some of this stuff out of my head to make some space in there for my actual day job. Since the clusterfuck David Goodhart book-copy-and-pastes op-eds started coming out a few weeks ago my head has been all fogged up with rage. Half of the frustration is simply how poorly he structures his arguments.

So here is some structure.

At the highest level there are two things to care about
1. The impact of policy (this is the utilitarian, consequentialist angle)
2. The Kantian ethics (what is a just process? we should care about the means as well as the ends)

Point 2, made repeatedly by Michael Clemens and others in the open borders camp, is that regardless of what the consequences of immigration are, individuals have rights, and states shouldn't be able to prevent people from leaving countries. As a Brit with some education, I have the right basically to live wherever I want. The same does not apply to smarter and harder working people than me who happen to be born in South Sudan, or most developing countries. In technical terms, this is called "fucked up."

Back to point 1 - there are three areas of concern
1.1 - The impact on the receiving community
1.2 - The impact on the migrant
1.3 - The impact on the sending community

Now, the strongest evidence is clearly on 1.2 - there are massive overwhelming positive impacts for the migrants themselves, who can increase incomes by orders of 1000% overnight.

The weakest evidence is on the other two points. There are reasons, theoretical and empirical, to think that immigration can have both positive and negative impacts on communities at large.

On 1.1 - perhaps the strongest evidence amongst the lot, is that the labour market impacts on receiving communities are not large (they did not took our job). There isn't a lot of evidence on the impact on public services and the like - though on average the foreign-born living in Britain are larger net contributors to public finances than the native born. So we are left with something vague about identity and community (more on this in another post).

On 1.3 - there is strong evidence of positive impact through remittances - remittances are substantially larger than foreign aid flows. There isn't much evidence of a brain drain, and actually evidence pointing the other way towards a "brain gain." Neither is there any evidence of a damaging impact on political reform. On the contrary, there are reasons to think that diaspora can help fund and influence reform movements more effectively from outside a country where they are not subject to political oppression. More from Claire Melamed here.

So to conclude, strong positive evidence of positive impacts for migrants and receivers of remittances, and then a bunch of weak vague stuff about community and governance. Add to that, the ethical or rights-based arguments.

And finally back to Goodhart, and his line that we should not care about people from Burundi more than people from Birmingham. But do we really need to care about them more to be in favour of immigration? From my reading of the evidence, I don't think that immigration does impose a net cost on Britain, but even being generous and assuming it did, I would weight that impact to be of the order of 1/10th of the positive impact to the migrant. Caring about people from Birmingham is fine, but the question is how much more should you care about them than someone from Burundi. I would image that there is some ratio at which Goodhart would support imposing a cost on a Brummie for a gain to a Burundian. What if we could make a Brummie worse off by £1 to increase the welfare of a Burundian by £10 billion? Or is it really never acceptable for British government policy to reduce the welfare of a British person by any amount, no matter how small, in order to increase a foreigner's welfare, no matter how large the gain? Not even for £10 billion? Martin Wolf does make the case for a zero weight, which is at least a coherent and explicit position on the issue, even if I do think it is abhorrent. Elsewhere, in a long and math-y blogpost YouNotSneaky estimated that for Mexican-US immigration, you have to value a Mexican at less than 1/20th of an American to be against immigration.

Do you care about foreigners less than locals? What's your number? Exactly how much less? Are foreigners half a local person? A tenth? A hundredth?

The Routledge Handbook of African Politics

If you were looking for a definitive overview of African Politics, you could probably do worse than this new volume, edited by Nic Cheeseman, David Anderson, and Andrea Scheibler. 32 chapters covering the State, Identity, Conflict, Democracy, Development, and International Relations.

For more, here is Andi writing at Democracy in Africa:

The Handbook, published last month, is the product of a collaboration between 35 established and emerging Africanist academics. Three years in the making, the Handbook is arguably the most comprehensive overview of African politics currently available on the market and we hope it will become a standard reference book for students seeking to understand the development of, and transitions within, contemporary Africa. ... 

Self-recommending. (And a 20% discount here)

A theory of justice (except for dirty foreigners)

Apparently John Rawls, the most important political philosopher of the 20th century, wasn't that bothered about global inequality. He supported barriers to migration, and supported only minimal amounts of international aid. I feel so let down. It feels almost like Jeffersonian levels of hypocrisy.

"in a much later work, The Law of  Peoples, published in 1999, Rawls went further and addressed the issues of global governance and global justice. There Rawls, at times explicitly and at times implicitly, discussed global income inequality and global income distribution and rejected the application of the "difference principle" globally.

from Branko Milanovic, in The Haves and the Have-Nots: A Brief and Idiosyncratic History of Global Inequality

Everything you ever wanted to know about migration and development

Well not quite, but the latest Development Drums podcast with Michael Clemens covers a lot of ground, including the case that should now be familiar for why migration has such enormous potential for development, and rebuttals to some of the most common criticisms. I am though continually amazed by how many smart development-industry types are so sceptical about migration (so if this is you, listen to the podcast now).

And for the wonks, there are also a couple of papers that were new to me:

A paper by Branko Milanovic calculating the determinants of individual earnings across countries. Earnings are partly determined by individual characteristics, and partly simply by what country you live in. Which is more important? It turns out that 59% of the differences in earnings is determined just by the country you live in. More than all of your personal characteristics - your experience, your education, your talents, your effort - all of it. I think that one of the defining differences between the left-wing and the right-wing is in the underlying assumptions about the determinants of individual success. Is it down to luck, or skill? If success is primarily due to skill, then a free market is going to deliver "fair" outcomes and the government should butt out. You work hard, you do well. But if success is primarily due to chance, then you can work as hard as you like, but it won't do much good if you were unlucky to begin with. So there is a "fair" case for the lucky to compensate the unlucky. So the life chances of humans born on earth are at least 59% chance. If you're born in Togo, the odds are stacked well against you.

Second, an old paper by David Card from 1990. In 1980, the US and Cuba made a one-off agreement to admit as many people as wanted to move. Over 100,000 people moved from Cuba to the Miami area. This amounted to a 7% increase in the Miami labour force in just 3 months - a huge increase. And yet there was no impact on unemployment or wages of existing workers in Miami.

Dowden on DFID

Richard Dowden, Director of the Royal African Society on the new DFID Ministers. Interesting stuff.

How does it look from Africa? Two things matter for African presidents and ministers. They like to establish personal relationships and trust in face to face talks with the same people over a long period. Secondly they like to deal with people who know something about their country’s history. They do not like ministers who talk down to them (as Mitchell did) or those who just read a brief on the plane as they fly in (as Douglas Alexander did). 

The recent reshuffle ignores these aspects and casts doubt over how much this government cares about development and its relations with Africa.

... 

[Greening] talks of a line by line investigation to ensure value for money which sounds good, but is actually nonsense. How can someone with no experience of development, with an annual accounts mentality, judge the value of long term development projects?

... 

although the indications are not propitious for a dynamic team working creatively to help get Africa nearer to the MDG targets in the next three years, I will not write off any of these appointments. But they look more like internal political expediency than what Africa and the rest of the developing world needs right now.

South Sudan: Failed or fragile?

This is a guest post by Aggrey Tisa Sabuni, Economic Advisor to the President, Republic of South Sudan. 

Foreign Policy magazine recently ranked South Sudan the fourth most "failed state" in the world in its 2012 Failed States Index, which ranks countries according to a list of 12 "state vulnerability" indicators. There are numerous concerns with this index; however, I would like focus my attention on the term "failed state". To fail implies you cannot learn, improve and eventually succeed. Although I do not dispute that South Sudan is fragile, I take issue with the idea that we will never prosper as a nation. Instead of labelling South Sudan as a lost cause, we should be working to identify the roots of our fragility so that we are able to turn around our fortunes. In this regard, I wonder if the readers of this post and the public at large truly understand what "fragility" actually means?

The term "fragile state" conjures up a number of different images, but ultimately it means a country is susceptible to a crisis, whether it is a natural disaster, an economic catastrophe or a security threat that cannot be easily dealt with. Fragility tends to be caused by the absence of a strong and effective government apparatus capable of dealing with crises as they develop, exacerbated by a lack of relative social harmony across different societal groups. Symptoms of fragility include regular outbreaks of internal insecurity, a weak justice system that fails to resolve disputes as they arise, a shortage of qualified and skilled personnel to staff key government institutions, and a lack of basic services to meet needs of the population.

However, fragility is also an opportunity. It is a chance to start over, to build from the foundation up. What is required, however, is patience. When you are building a house the foundation is the first and most important step. It takes more time to complete than the rest of the house. In South Sudan we are building the foundation.

The year since our independence on the 9th July 2011 has been a turbulent one. The Government and our population have been operating under very challenging circumstances and we are learning how to address these challenges. On January 20th the Government made the decision to shutdown of oil production, in response to repeated provocation from the Government of Sudan and the theft of South Sudan’s oil. As a result, we are facing the prospect of losing 98 per cent of our revenue. We have also seen a resurgence of open hostilities in the border regions, rising domestic prices for basic commodities, insecurity from cattle raiding and limited provision of services.

We did not expect it to be an easy year.

Despite these challenges, we have begun to see the fruits of our labour in other important activities. National and State governments have adopted constitutions and are abiding by them. In Jonglei State, we have witnessed a peace accord that has stabilised relationships between the various groups in that State. These actions have undoubtedly helped improve the level of internal security and has promoted an increasingly strong sense of nationhood amongst the population.

In the area of economic policy, we have implemented significant public financial management reforms, which have led to an increase in non-oil revenue collections of over 250 per cent since July 2011. A new currency was successfully introduced under extremely challenging circumstances, but with minimal disruption to the South Sudanese. All of these successes have been achieved under the framework of the South Sudan Development Plan, our first ever national plan, which outlines how best to use Government and donor funds for the development of the country.

These are not insubstantial achievements. They are a direct reflection of a country determined to ensure that its people benefit from improved security and economic prospects.

Despite these successes, we have continued to receive a significant amount of negative press over our actions, particularly the decision to halt oil production. While there is no doubt that circumstances have slowed down our progress, the fact remains that the complex nature of our negotiations with the Government of Sudan disguises their unwillingness to negotiate and compromise a settlement. Until the political challenges with Sudan are resolved, we will continue to be hampered in our efforts to build a solid foundation for South Sudan. As such, this is the precise moment where we need our friends in the international community to stand up, to acknowledge our successes and failures, and to actively support the efforts of the government in dealing with its challenges.

South Sudan is not a failed state. We are a country rich in potential but hampered by short term fragility. Managing the challenges we face is not a simple task. I strongly believe that South Sudan can utilise its abundant resources for the benefit of the population and the region if an adequate foundation is built. However, this processes requires the patience and sustained support of the international community. We will undoubtedly make mistakes along the way, but with the support of our friends, we will be able build a strong and prosperous nation.

Chart of the Day: Gay Marriage in America

read more at the Monkey Cage.

And here is an equivalent chart for Europe.

The Arab Spring: Too much education and not enough jobs

Its always nice to have your priors confirmed by some systematic data. Here is Campante and Chor in the Journal of Economic Perspectives with a nice chart showing that Arab countries do generally have higher than average unemployment and more recent growth in education than other countries.

They also find some evidence (correlation is not causation etc) that it is the interaction between unemployment and schooling that has led to political change, and not either by them self.  

David Cameron doesn't care about poor people either

“The problem is policy is being run by two public school boys [Cameron and Osborne] who don’t know what it’s like to go to the supermarket and have to put things back on the shelves because they can’t afford it for their children’s lunchboxes,” says Nadine Dorries, another Conservative MP. “What’s worse, they don’t care either.”

And he doesn't care because those poor people live in Northern cities which never voted tory anyway.

Unemployment in traditional Labour areas is currently much higher than in traditional Conservative areas. In north-east England it is 11.2%, in Yorkshire and the Humber it stands at 9.9%, in the north-west at 9.3% and in Wales at 9%. By sharp contrast, unemployment in the south-west is 6.1%, in the south-east it is 6.3% and in the east of England it is 7%.  

Zooming into even more local figures reinforces this picture. The national rate of people claiming jobseekers' allowance is currently 5%. In Labour-held seats, the rate is an average 5.2%, while in Conservative-held seats it is considerably lower at 2.9%. In the 50 most marginal Conservative-held seats it is 3.6%, well below the national average and that of Labour-held seats. 

History shows that it is perfectly possible for Conservative governments to oversee sluggish growth, rising unemployment and public spending cuts while winning re-election. As Stanley Baldwin in the 1930s and Margaret Thatcher in the 1980s proved, the crucial factor is that enough people are doing comparatively better to sustain an election-winning coalition.

Part of me was quite relaxed when Labour lost the last election. They had been in power for over a decade,  which is never healthy, and a break would probably do them some good. And the Conservatives probably wouldn't be that bad. Especially with the Lib Dems there to tone down their worst excesses. I was wrong.

Justin Wolfers and Betsey Stevenson make a good point about asymmetric risks;

Europe’s experience in the 1970s and 1980s demonstrated that persistently high unemployment can become entrenched, leading to further unemployment in the future -- a process economists call hysteresis. Skills atrophy, hope fades and people lose contact with the networks that can help them find work. If this occurs with the millions of U.S. workers who have been without jobs for more than a year, it will be costly and very difficult to undo. 

In other words, the cost of too little growth far outweighs the cost of too much. If we readily bear the burden of carrying an umbrella when there’s a reasonable chance of getting wet, we should certainly be willing to stimulate the economy when there’s a reasonable risk that doing nothing could yield a jobless generation.

Christina Romer suggests that

European policy makers just don’t get it.

What is scarier is the notion that they do "get it", but just don't care.

David Cameron doesn't care about black people

to paraphrase Kanye, that is pretty much the impression that I got from Lord Ashcroft's interesting new report on ethnic minorities and the Conservative Party.

At the 2010 election, only 16% of ethnic minority voters supported the  Conservatives. More than two thirds voted Labour.
...
by polling white voters alongside those from ethnic minorities, we demonstrated that the Conservative Party’s unpopularity among black and Asian voters is not simply a matter of class and geography. There were sometimes strikingly different results between white and non-white voters living in the same area, and between different ethnic minority groups. Among ethnic minority voters the Conservatives’ brand problem exists in a more intense form. For many of our participants  - by no means all, it is important to state  - there was an extra barrier between them and the Conservative Party directly related to their ethnic background. If Labour was the party that helped their families to establish themselves in Britain, had represented people who did their kind of work, and had passed laws to help ensure they were treated equally, the Conservatives, they felt, had been none to keen on their presence in the first place. Enoch Powell was often mentioned in evidence, as was the notorious Smethwick election campaign of 1964 in which a poster appeared - not distributed by the Conservatives, but remembered as such - saying “if you want a n****r for a neighbour vote Labour”. The failure, on the Conservatives’ watch, properly to investigate the murder of Stephen Lawrence was also cited. Most thought that if prejudice had been widespread in the party, then  the  Conservatives had changed in recent years, whether through principle or necessity. But significant numbers  - which particularly included people from a black Caribbean background  - felt the Tories remained indifferent or even hostile towards ethnic minorities. Many felt the Tories, and David Cameron in particular, had unfairly blamed ethnic minorities for last summer’s riots. 

Via Rob Ford

War in Sudan

It seems that South Sudan is losing the PR war. The decisions to shut down Southern oil production and now to take Heglig do not seem to have been viewed favourably by the international community.

I started trying to write something this morning, but I just got angry and frustrated. Just in time, here is John Ashworth, who for me is the best and most articulate political analyst on Sudan going, and who is frankly worth quoting in full. I would strongly urge anyone with any influence on the matter to read it. John is clearly like me very biased in favour of South Sudan, but this bias is based on considerable evidence rather than whimsy, not least of which for me the fact that amongst all this moral equivalence between the two sides, there is still an international arrest warrant out for the President of Northern Sudan for murder, extermination, forcible transfer, torture, rape, pillaging, and intentionally directing attacks against civilians.

Here's John:

A senior international church leader said to me yesterday, "many statements, including those of AU and UN, seem to suggest that South Sudan just woke up one morning and decided to invade and occupy Heglig. And then they go ahead to apportion equal blame to the two states. We have to find a way of countering this perspective." The international discourse seems to be based on Khartoum's narrative. This must be balanced with Juba's narrative, not in order to support Juba's claim, but in the interests of resolving the problem. A one-sided approach will not lead to lasting peace. As Juba's Spokesperson Dr. Barnaba Marial says, “I think it is good that the Security Council first listens to the story of Heglig, and I think they have not listened adequately from our point of view" (article 6, below). 

Indeed South Sudan did NOT just wake up one morning and decide to occupy Heglig. It should be remembered that President Salva Kiir has always followed a policy of refraining from military action. In the run up to the referendum and independence, he specifically instructed his commanders not to be provoked by Khartoum's military aggression, and not to retaliate. This policy proved remarkably successful and helped to deliver a peaceful referendum and independence. 

The President then continued to pursue a similar non-military policy for 9 months or so after independence. Khartoum has walked out of negotiations, made unreasonable demands (eg demanding more than ten times the international standard fees for transit of South Sudanese oil through its pipelines), abrogated agreements which it had already signed (eg the peace deal with SPLM-N, the agreement on the status of South Sudanese in Sudan, to say nothing of the Abyei Protocol), continued its military occupation of the disputed area of Abyei, harassed South Sudanese in Sudan, continued to attack South Sudan's former allies in the Nuba Mountains and Blue Nile, siphoned off (or stolen) a percentage of South Sudan's oil, attempted to build illegal pipelines, forcibly occupied the disputed area of Jau, bombed refugee camps and civilians well inside South Sudan, supported South Sudanese rebel movements (and allowed them to abduct and forcibly recruit South Sudanese in Sudan), stifled cross-border trade, and much more. As article 5, below, points out, "the Khartoum government has been launching ground and air attacks against [South Sudan] since it declared independence July 9 [2011]". During all of this, South Sudan's army did not retaliate offensively, limiting itself to pushing SAF out of Jau but stopping when it reached the current border (which is not the 1956 border). President Salva Kiir's policy of restraint was not popular in South Sudan; people were asking, "What is the matter with him?"

Now, after nine months of restraint in the face of intransigence and provocation by Khartoum, South Sudan has finally decided to assert itself a little, by following an SAF force which attacked South Sudan back to their base, the disputed town of Heglig/Panthou, and ensuring that it could no longer be used as a jumping off point for further aerial and ground attacks on South Sudan. It also made the political point that Heglig/Panthou is disputed, that the current border is not the 1956 border, and that it is erroneous to insist that a town is north or south of the 1956 border until the 1956 border has actually been demarcated to the satisfaction of both sides. It seems to be a very popular move amongst the people of South Sudan.

The result is that the international community leaps to blame South Sudan, which has been so restrained for so long. At the same time, President Omar Hassan al Bashir has now declared that his aim is to change the government in Juba, which he has described as "insects". Surely this is a rather serious matter, when a president declares that he will take military action to overthrow the government of another sovereign state? Can we now expect the international community to severely censure Khartoum and make it clear that any attempt to change the government of another sovereign state will be met with the strongest possible sanctions? Can we expect them to cease their "moral equivalence" and recognise that there is an aggressor here - and that aggressor is not the "insects" of South Sudan? Urging both sides to make peace is fine, but which is the side that has consistently refused to make peace, and which is the side that has acted in a restrained manner and genuinely tried not to be drawn into armed conflict? 

Note that South Sudan has offered to withdraw from Heglig/Panthou if the UN puts a neutral force there (articles 2 and 6, below), an offer which the international community is unlikely to accept because Khartoum will not agree. Again, which side is refusing to make peace in Heglig? 

I don't think I will ever understand the international community! 

The BBC makes two errors in article 1, below. Firstly, it is not true that Heglig is "generally recognised as Sudanese territory". Many analysts who actually know what they are talking about (as opposed to journalists, diplomats and politicians) argue that it is disputed. Millions of South Sudanese, Nuba and others "generally recognise" that Heglig belongs in South Sudan. Secondly, both sides do NOT "claim" Abyei. South Sudan claims that the residents of Abyei should have the referendum which they were promised in the Comprehensive Peace Agreement to decide whether Abyei should be part of Sudan or South Sudan; Khartoum has blocked the referendum and occupied the area militarily.

The evolving art of political economy analysis

This is a guest-post by Richard Williams, summarising his new OPM Development Futures paper, co-authored with James Copestake of the University of Bath

Over the last 15 years, development actors have increasingly recognised the political and messy nature of reform. Prescribing best practice solutions has often failed given the differing perspectives, capacity and motivations of stakeholders on each side of the aid relationship. Political economy analysis (PEA) has emerged in response to help practitioners close this gap and understand the reform environment in which they are acting. This has led to more realism in the aid industry with more open discussions of power, political culture, ethnic divisions, corruption, sources of opposition and indifference, and so on.

However, PEA as it stands risks becoming another routine element in aid programming, rather than a transforming, innovative influence on how development practice works. For example, the common tool guiding aid programmes - the logical framework - is no doubt enhanced by the use of PEA, for example by ensuring resources are more aligned to local structures, but the fundamental premise of how we act stays the same: goals are set, a logical sequence of actions predicted and all things messy or unknown are relegated to a heading under ‘risks’.

This Development Futures paper charts a new course for PEA to have a more radical impact on development practice. It argues that if we are serious about embracing the political and complex nature of development then we need different ways of acting to confront such complexity. This includes acknowledging our own limited knowledge (an action rarely applauded), the need to collaborate with others to build new knowledge and increased flexibility to react to such analysis as well as other unexpected events. PEA therefore should strive to be more than a technocratic means to understand the commitment and capacity of others but an opportunity for internal learning and adjustment.

To this end, the paper sets out a framework for combining PEAs focus on the macro-politics of recipient country interests with the micro-politics of stakeholder relations, including more self-reflection on the part of donors and consultants. This paves the way for thinking of development practice as iterative cycles of experimentation, discovery, learning and interaction. Whilst this perhaps sounds ambitious, particularly given the current emphasis on visible results and value for money, we argue that these iterative cycles of engagement are already happening. By making them more explicit we can become more effective.

(these views don't necessarily represent the views of OPM or the University of Bath, etc etc.....)

Kenyan Political joke of the week

No, not the election news, but this:

Little Njoro of Buru estate in Nairobi wanted Kshs 1,000 badly and prayed to God for two weeks but nothing happened. 

Then he decided to write God a letter requesting the Kshs 1,000. When the postal authorities received the letter addressed to God from Buru buru in Kenya, they decided to send it to State House. 

The letter never even got to the president but an aide was very touched and so he sent the boy Kshs 200. He felt that this was a lot of money for a small kid.
Njoro was delighted when he received the Kshs 200 and sat down to write a thank you note to God, which read: 

Dear God, 

Thank you very much for sending the money.
I don’t want to sound ungrateful but I noticed that for some reason you had to send it through State House and, as usual, those crooks deducted a whole Kshs 800. My teacher tells me that you never forget, but did you not this once forget that Kenya is one of the most corrupt countries in the world and that as my dad is always saying corruption starts at the top? 

I suggest you send an angel next time.
Thanks,Njoro.

HT: @RichardTrillo 

Policies, Politics, and Poor Economics

Some gentle criticism of Banerjee and Duflo on political economy. From Poor Economics, they say:

Political economy is the view (embraced, as we have seen, by a number of development scholars) that politics has primacy over economics: Institutions define and limit the scope of economic policy. 

there is no reason to believe, as the political economy view would have it, that politics always trumps policies 

Which is a bit of a straw man.  For example, Benno J. Ndulu and Stephen A. O’Connell write:

Growth depends on the interaction of opportunities with choices.

The central message of the Growth project is to confirm the critical importance of policy for long term growth in SSA.

and Daron Acemoglu and James A. Robinson

Main thesis is that growth is much more likely under inclusive institutions than extractive institutions. 

Though growth is much more likely under inclusive institutions, it is still possible under extractive institutions.

Their basic point is valid, but maybe just a little oversold. I'm not sure that Acemoglu and Robinson really think that there is nothing at all to be done to improve things in countries with weak institutions.

Finally, they make a point also made by Tony Blair which you don't otherwise tend to hear too much - focusing relentlessly on delivery of something can help to improve governance.

Good policies can also help break the vicious cycle of low expectations: If the government starts to deliver, people will start taking politics more seriously and put pressure on the government to deliver more, rather than opting out or voting unthinkingly for their coethnics or taking up arms against the government.  

The political constraints are real, and they make it difficult to find big solutions to big problems. But there is considerable slack to improve institutions and policy at the margin. Careful understanding of the motivations and the constraints of everyone (poor people, civil servants, taxpayers, elected politicians, and so on) can lead to policies and institutions that are better designed, and less likely to be perverted by corruption or dereliction of duty.

Political Economy is Hard

2 big political announcements in South Sudan this week (umm, this was written on 31 Oct 2024) illustrate how difficult it is as an outsider to even begin to understand local politics.

The respected Minister for Civil Service Reform Awut Deng Acuil has resigned for reasons that have not been made clear, and top civil servant Aggrey Tisa Sabuni has been appointed Economic Adviser to the President (from Undersecretary at the Ministry of Finance. Congratulations Tisa!). The implications of these two moves are probably significant, but there just isn't any English-language media analysis.

Doing "political economy analysis" in the UK simply means picking up almost any newspaper on a regular basis. What is a donor supposed to do when they can't do that?

So the implications of this:
(a) if we believe that understanding politics is important for effective policy design, and
(b) we generally aren't very good at understanding politics in developing countries

---> we should probably go for simple interventions with either very high benefit-cost ratios, or with low dependence on understanding local systems.

Sidenote: I did a bit of googling for some analysis of the last Nigerian budget. Well done to PWC for coming up with something. But really, the rest of the whole entire world, we don't think its worth bothering to figure out some way of funding someone to take a really hard serious look at the spending decisions of the government of the most populous country in Africa, and then get surprised when things blow up??

Evil Aid-Cutting genius

Now if only there were a way of convincing those liberals that aid is bad. You would want to think of some clever way in which foreign aid is totally at odds with fundamental liberal values.

The British government says it will cut aid to African countries that persecute LGBT people.
International Development Secretary Andrew Mitchell revealed the UK has already cut funding to Malawi by £19 million after two gay men were sentenced to 14 years in prison last May reports the Daily Mail.

"We only provide aid directly to governments when we are satisfied that they share our commitments to reduce poverty and respect human rights."

What say you now Liberal! Should we feed the starving if they are homophobic!? Mmmmm, thats right liberal, squirm, mmm let me taste your discomfort....

[Bit rich coming from a government intent on repealing the Human Rights Act though right?]

Social Protection or Political Patronage?

Marco Manacorda, Ed Miguel, and Andrea Vigorito put a working paper out a couple of years ago showing a relationship between receipt of a Uruguayan government cash transfer scheme, and political support for the governing party. Which pretty much makes sense. 

we find that beneficiary households are 21 to 28 percentage points more likely to favor the  current government (relative to the previous government) ... 

Back-of-the envelope calculations suggest that securing  one extra supporter costs the government on the order of US$2,000 per year, or one third of national GDP per capita (though this estimate is an upper bound cost if political impacts persist after the program has ended).

 Which is fine. Government-funded social protection buys political support.

So what does aid-financed social protection buy? Does it depend on who delivers the program? Hopefully GiveDirectly.org can work this into their RCT.

The South Sudan Wikileaks Cables

South Sudanese politics is a bit of a mystery to me.

PaanLuel Wel, who is rapidly becoming the best and most prolific blogger on South Sudan, links to a bunch of cables on South Sudan with some fascinating candid conversations;

SPLM Factions: Garangists vs. Kiirists vs. Macharists

SPLM/A’s Internal Struggle

SPLM Leadership under Salva Kiir

VP Machar & Nhial Deng, and cleaning Corruption in the SPLA

Dr. Lam Akol

Bona Malwal

John Luk and Lou Disarmament in 2006

LRA and Riek Machar

Kiir’s intention toward militias leaders

Nhial Deng’s resignation

Gen. Oyai Deng Disagreemnt with Salva Kiir