Development Roast Giving international development a proper roasting
The Italian economist Vilfredo Pareto (1848-1923) observed, in 1906, that twenty percent of the Italian people owned eighty percent of their country’s accumulated wealth. This 20/80 ratio has since been observed in a large variety of situations, and the general idea of the “Pareto Principle” or the “80/20 rule” is that roughly 80% of “outputs” or “consequences” is typically caused by 20% of the “inputs” or “causes”. For example: 20% of motorists cause 80% of all accidents; 20% of criminals commit 80% of crimes; 20% of beer drinkers drink 80% of all beer; and 20% of clients account for 80% of sales.
Governments Giving Gifts – Populations Acquiring Rights
Recently, the Bolivian government has made a generous change to the universal pension payment scheme (formerly BONOSOL, now Renta Dignidad) lowering the pension reception age from 65 to 60 years, and increasing the annual payment from Bs. 1.800 to Bs. 2.400. This means an immediate doubling of universal pension payments. However, due to the rapidly increasing population aged 60+, already by 2025 this implies a pledge of 3.5 times the current universal pension payments.
Are we so different?
The “Explaining African Economic Growth” project was launched in 1999 as a common research project between top world universities under the leadership of the African Economic Research Consortium (AERC). As a result of this project, the book “The Political Economy of Economic Growth in Africa, 1960-2000” (1) is considered as a major common-effort breakthrough towards the explanation of recent Africa´s economic history. Top scholars such as Jean-Paul Azam, Robert Bates, Paul Collier, Anke Heoffler, Agustin Kwasi Fosu, Benno Ndulu and Stephen O’Connell seem to agree than most of Sub-Saharan Africa (SSA) underperformances in economic development can be explained mainly by the so-called four “Anti-Growth Syndromes” (2) of policy environments.
Why don’t all countries adopt good institutions?
“The only justifiable purpose of political institutions is to ensure the unhindered development of the individual.” Albert Einstein
Having good institutions that guarantee citizens a large degree of economic freedom has been shown to be strongly correlated with the usual development indicators, such as GDP per capita, life expectancy, and literacy rates, and negatively correlated with poverty, child labor, child mortality and informality (1).
Gross National Happiness
“Wealth is the ability to fully experience life.”
Henry David Thoreau
“Being rich is having money; being wealthy is having time.”
Margaret Bonnano
“The problems that exist in the world today cannot be solved by the level of thinking that created them.”
Albert Einstein
Economists, especially development economists, almost always measure the level of well-being in a society by per capita income, noticing that this simple economic measure is highly correlated with most other indicators of development they can think of (life expectancy, child mortality, income equality, education levels, etc.).
Reverse Psychology in Migration Policy
Reverse psychology is frequently applied by parents: If you want your kids to do something (like washing the dishes or mowing the lawn), tell them they can’t. That is often much more effective than begging or threatening them to do it.
Believe it or not: Bolivia is one of the World’s Top Emerging Tourism Destinations!
The World Tourism Organization publishes facts and figures on international tourism, including a table of the World’s Top Emerging Tourism Destinations, as measured by the growth in international tourist arrivals.
The good news is that Bolivia has made it to the table! (Mexico and Brazil didn’t). The bad news is that it is at the very bottom of the table. Of the 76 countries included, Bolivia was last with an average annual growth rate in international tourist arrivals of 4.0% between 1995 and 2004.
Is International Migration Increasing?
Most people would find the answer to that question so obvious that they wouldn’t even bother to check the data.
According to UN data, the number of people counted as living outside their country of birth has almost doubled during the last 50 years–increasing to 191 million in 2005, the highest number ever recorded (1). But the World population has more than doubled during the same period, so international migrants still constitute just a bit less than 3% of the World’s population.
Treat Your Migrants Better!
“Patriotism is your conviction that your country is superior to all other countries because you were born in it.”
George Bernard Shaw (1856 – 1950)
There are surprisingly few international migrants in the world. Only around 3% of the worlds population live in another country than the one where they were born (1).
Considering how many fantastic places there are in this world, it is quite surprising that most people are contented with staying all their lives in the place where they just happened to be born. Read More »
Save First – Consume Later
“Money often costs too much.”
Ralph Waldo Emerson
If children were to learn just one thing in school, it should be The Power of Compound Interest. If everybody understood and applied that simple principle, poverty could be permanently eradicated in one life-time.
Let me explain how it works by comparing two persons, A and B, who, for simplicity, both live for 100 years.