How does Owen Barder define development? How does he extend Amartya Sen’s definition to include the idea of complexity?
Barder agrees with Sen’s definition that development goes beyond just economic improvements. He believes in the holistic measurement of many development topics including human well-being beyond simply economic development. However, Barder also thinks that this definition is not inclusive and cannot be used to measure development. He argues the point that development is an intrinsic part of both the economic system and the social system and cannot be measured by external factors. These systems represent improvement.
Who was Thomas Thwaites and what was his “toaster project”? Was he successful? What is the significance of this example in the context of Barder’s talk about complexity and development?
Thwaites was a student in Britain who attempted to make a toaster from scratch by finding all of the raw materials himself and crafting them into toaster parts. He was technically successful, as the toaster worked for a few seconds until it shorted out because he could not acquire any rubber to insulate the wire. This example is pertinent because it illustrates the amount of people, parts, and coordination that is required to construct one simple toaster. It took nine months for Thwaites to toast his bread for five seconds, so it is no wonder development issues are so hard to address. A country has hundreds of thousands more working parts and people to attempt to organize. Plus, a nation must figure out how to make a toaster, or other commodities, in order to sustain its economy.
Barder compared the economic growth of South Korea and Ghana between 1960 and 2010. Why was this example instructive as part of his talk? What did this comparison demonstrate when used as the basis to validate (or invalidate) economic models?
It seems that Brader brings up the comparison between South Korea and Ghana not to give an answer to explain the divergence, but to use it to illustrate the failings of past economic models presented to be lacking in the podcast. All of the models fall short in potentially explaining this difference. The only model Barder concedes follows the trend in Ghana and South Africa is Solow’s neoclassical growth model. But, he compares an aspect to “manna from heaven” ultimately alluding that the model is worthless for it relies on an intangible, nonexistent measurement.
What was the Harrod-Domar model? What are the two fundamental variables in this model? Who was Walter Rostow and what the impact of his work on development? Was the Harrod-Domar model effective at predicting development outcomes?
The Harrod-Domar model postulates that capital is the key component to development. The two variables are capital and labor, with both a country has the means to produce high output and sustain their economy. The model then makes the argument that developing countries have cheap, abundant labor, so the countries must be missing the capital to produce economy supporting goods. The Harrod-Domar model is not effective at predicting development outcomes, because when one compares the variable in South Korea and Ghanan, the differences that should exist given the model are not found.
What was the Robert Solow model and how did it address the limitations of the Harrod-Domar model? Was this model successful as predicting economic growth?
Solow attempted to address the shortcomings of the Harrod-Domar model by adding a third variable on top of capital and labor– he called it technical change. Brader argues that the model fits better than the Harrod-Domar model, but still has shortcomings as what “technical changes” means is never strictly defined, making the model inapplicable to reality. Even if it referred to access to technology, it would be inconsistent with the Ghana-South Korea comparison.
What was the Washington Consensus? How did it propose to improve upon models of economic growth?
The Waskington Consensus argues that countries already have access to the resources and labor and the “technical change” needed to thrive economically, but the governrement is what is holding them back. The Consensus focuses on what policy changes can be made to improve the economy, mostly regarding government spending, interest/exchange rates, and trade. Many argue the Washington Consensus was ineffective and did not lead to much developmental improvement. Still, there are some that believe changes made in policies in Sub Saharan Africa is responsible for some development.
What was the Ajaokuta Steel Works? How did it illustrate the transition from a focus on policies to institutions. How productive has the Nigerian steel works proven to be?
The Ajaoukuta Steel Works represents the largest investment in production anywhere in the world. Investments in the project total 5 billion USD. Nevertheless, Ajaokuta has never produced any steel, despite the capital, labor, and cutting edge steel-producing technology waiting to be utilized. This lead to the transition from focusing on policy to institutions, attempting to restructure governments to reduce inefficiencies and rampant corruption.
Who was Haile Sellasie? What is the significance of Kapuscinski’s book the Emperor? How did Ethiopia exemplify the suppression of emergent systemic change? Do you agree with Barder’s interpretation?
Sellasie was the emperor of Ethiopia until he was overthrown in 1974. He was a classic example of a corrupt, elite member of the ruling class, pushing others in the country into poverty. Barder uses Sellasie as a way to explain the “resource curse”. When ample resources and money are available to a set of ruling people, they will abuse the resources and oppress the lower class. This prevents coevolution to occur, preventing complex development.
Who was Steve Jones? What did he do at Uni-Lever? Was he successful? How significant were his results?
Steve Jones was a biologist tasked with improving the nozzle to create powdered soap. The other engineers tasked with solving the problem could not develop an effective design. Jones took another approach. He randomly created 10 designs for the nozzle. Then he picked the most effective design and made 10 variations. Next, he chose the most effective design from that and make variations, and so on a so forth. Jones was widely successful, proving that evolution is often more effective than design, especially when it comes to complexity.
What is the significance of Schumpeter’s idea of creative destruction? How does it relate to firms and industries?
The idea of creative destruction outlines how it is necessary for some entities to become obsolete, as new and improved entities are created in order for progress to occur. The idea is used often time in industries in a Darwinistic sense, that companies who do not adapt to changes in the industries will fail, while new companies will improve the industry as they implement new things.
Why does Barder recommend resisting engineering as a policy implication? Does he suggest a different approach? What did he mean by his use of the term, iso-morphic mimicry?
Barder argues development is too complex to engineer a reasonable, successful approach to addressing issues. Rather, he believes people should take an approach similar to Jones with the soap nozzle and allow solutions to “evolve”, as they will be better catered to the issue and provide a better solution. Iso-morphic mimicry is a term from biology to describe an organism that looks like another organism, typically one that is poisonous, without being poisonous itself. He uses this example to warn against creating institutions that look like, say a police force, but does not actually protect citizens.
What did Barder mean by “resist fatalism”? Who was Norman Borlaug and what is the green revolution?
Barder uses the term “resist fatalism” to encourage people to not simply accept the product’s evolution provides. Rather, he argues that humans can expedite and direct evolution. Borlaug initiated the green revolution, a movement in Africa to produce high yield, drought-resistant crops, ultimately saving more than a billion people.