Category: research

Necessary adjustments – but quant and qual still meet

The other day, I posted about the convergence between my own qualitative findings on the food security outcomes of food price instability and those of Marc Bellemare, Chris Barrett and David Just: that, at least in various parts of Africa, such instability was most likely to impact the middle and upper income cohorts more than the lower income cohorts of a given population.  However, I jumped too quickly in assuming that their dataset included rural and urban households – as Marc pointed out on his blog, they used a panel of rural household surveys.  So my initial argument about convergence does not hold up, as they did not consider the urban context in their work.
This is not to say that I am backing away from my assessment of the vulnerabilities of urban populations to this sort of challenge – I stand by it, having seen it, if only anecdotally, in towns and cities in Ghana over the past 13 years.  Urban populations are generally much more dependent on markets for their food supply than those living in rural areas (though this is not always true), and therefore price instability does create significant livelihoods uncertainty that is very difficult to manage, especially for the urban poor.  I therefore stand by my argument that we need to be keeping a close eye on the relative impact of price volatility on urban and rural populations, as the impacts of such volatility is likely to have very different impacts on these groups.
But recognizing that Bellemare et al’s work only addresses rural outcomes is not a problem for my argument about what I am loosely calling temporary deglobalization as a strategy for managing price instability (and price increases) – indeed, I think it strengthens the argument because it means that their dataset is now commensurate with mine, which was also rural.  As I argued in an extended comment on Marc’s blog:

The rural farmers most hit by price instability are those most integrated with global markets – the ones least able to deglobalize, as it were, when things get uncertain . . . Meanwhile, the bottom 60% is not as engaged with markets in which price volatility matters, and therefore can back away from them in terms of how they use their crops. In my work in Ghana, I found very few true cash crops (in the area I was working). Instead, some crops were treated like “cash crops” in years where price conditions and farm outputs of staple crops were favorable, and as staple crops when either prices were not favorable (including periods of volatility) or outputs of other staples used for subsistence were not adequate to meet household food needs. (Note: in many cases, the treatment of a crop as “cash” or “staple/subsistence” was highly gendered as well). The real difference between the rich and poor (relative terms in the Ghana sample) is the overall livelihoods strategy – one strategy (seen among the wealthier) is much, much more engaged in production for local markets, while the other (seen among the poorer) hedged market production with significant subsistence production (again, highly gendered). In years of volatility (or really in the face of most shocks), the market-oriented livelihoods were simply less resilient than the more diversified livelihoods strategies of the poorer households.

Or, as Marc himself noted in his response to my post on his blog:

[The wealthier] households tend to be hurt by price volatility because they are producers and therefore net sellers of most of (if not all) the seven commodities retained for analysis (i.e., coffee, maize, beans, wheat, teff, barley, sorghum).

So this means that the “temporary deglobalization” argument is not merely a rural-versus-urban argument, but one that can separate households in the same rural community.  This, I think, strengthens one of the arguments I was making in my original post:

  • Demanding that rural producers orient themselves toward greater and greater integration with global markets in the absence of robust fallback measures (such as established, transparent microinsurance and microsavings initiatives) will likely extend the impact of future price instability further into the poorest populations.
Posted on by Ed 1

Disciplinary history and theory are useful II: Understanding the MVP’s enduring popularity

In my guest post on Aid Watch yesterday, I argued that a basic familiarity with the history and philosophy of development, and some training in critical approaches to development, might have averted at least one of the problems currently associated with the Millennium Village Project (a conflict of interest for project workers when the stated goals and interventions of the project and the needs of MVP communities do not align) before it happened.
A failure of background knowledge also lies at the heart of the MVP’s enduring popularity, even in the face of mounting empirical evidence that it is not working.  It is one thing to ignore the predictions of a lone academic (or a few academics).  It is another to overlook evidence of problems trickling in from around the world. If the MVP is so flawed, why do so many continue to support it?
I argue that the MVP drew its popularity from two sources: its theoretical eclecticism, and from the ways in which it resonated with conventional understandings of development and development practice in the major agencies.  If one goes through the literature on the MVP, one will find echoes of many different bodies of development theory (I say “echoes” purposefully: the MVP has never overtly referenced any bodies of development theory in its publications, forcing critics to read between the lines).  For example, various authors (e.g. here and here) have found in the MVP the influence of “big push” theories with their foundations in the 1950s, while others hear the reverberations of Reagan-era privatization and deregulation.
While drawing upon many bodies of theory to build something new is not a problem in and of itself, doing so productively requires an understanding of each theory from which one is drawing.  The framing of the MVP shows no sign of such familiarity.  Instead, it appears to pluck “useful” bits and pieces of these theories that support the project’s larger political agenda and justifications for its technical interventions.  It adopts the language of “big push” theories when it argues for a concentrated injection of capital across sectors of a village economy to get them all moving simultaneously.  At the same time, it turns to the governance focus with echoes in modernization theory.  As I argued in my article on the MVP:

This focus, insofar as it does not consider the ways in which existing processes do function and places a priori weight on Western modes of administration and governance, echoes earlier, often ethnocentric, tenets of modernization theory, such as the need to convince societies to embrace new, Western forms of administration on their path to ‘development’. (338)

The problem is that these “useful bits” were parts of larger theories that, on the whole, often contradicted one another.

For example, as Cabral et al. (2006) have observed, ‘big push’ theories of development that see a coordinated injection of capital across all sectors of an economy as a productive means of driving economic ‘take off ’ and development (for example, Rostow 1959) run contrary to the claims of modernization theorists like Lewis (1954), who saw unbalanced growth in different sectors of the economy as a key to stimulating the overall economy. (338)

The result was a project that on one hand had something for every development perspective.  However, this came at the cost of internal coherence, and the ability to reflect upon or address the well-known historical problems encountered by those who employed the larger theories from which these bits were taken. A reasonable familiarity with the history and philosophy of development would have made these issues apparent long before there was a need to gather empirical evidence on the performance of the MVP.
But this sort of eclecticism only goes so far in explaining the popularity of a project – after all, most people do not worry much about the underlying assumptions of a given project or program.  What policymakers certainly do notice are the ways in which the MVP nicely aligns itself with conventional understandings of development policy and practice.  For example, there are broad similarities in approach and assumptions between the MVP and Poverty Reduction Strategy Papers (PRSPs) which suggest that the MVP is not only nothing new, it is nothing revolutionary (or, in fact, even that different from what is already being done by the mainstream development community):

Like the MVP, PRSPs tend to deal with development issues sectorally, without addressing either the tradeoffs or the synergies between different sectors – this is particularly true in the context of sustainable development planning. PRSPs also tend to conceive of solutions to sectoral problems without reference to local conditions. For example, lagging agricultural production is often addressed through the introduction of more inputs, which on its surface might seem like the ‘common sense’ application of ‘tested and true methods’. Such a set of solutions and rhetoric is nearly identical to that seen in the MVP. Finally, PRSPs, like the MVP, do not consider the social context and processes through which problems are identified and solutions shaped at the national or local level. Yet, national politics may influence the identification of a particular harvest as ‘insufficient’ or ‘sufficient’, a label that shapeshow people view that harvest and the needs of those who are dependent on it for their livelihoods. In short, the MVP and the PSRPs are mutually reinforcing – there is no challenge to the development status quo in the MVP, except perhaps in the form of a call for more money to fund the ‘big push’ (Cabral et al. 2006) needed to ‘kick-start’ development in these villages. (338-339)

Again, a familiarity with the conceptual literature in development studies would have allowed those who touted this project as something new to recognize its fundamentally conservative approach to development.
All of this goes to deepen an underlying point in the Aid Watch post: more practitioner training in the history and philosophy of development, and a wider exposure to critical approaches to development, are critical first steps toward the creation of (or simply the recognition of) truly revolutionary, coherent and ultimately successful projects.

Posted on by Ed 1

Where Quant and Qual meet: On speculation, price instability and food insecurity

UPDATE: Marc Bellemare pointed out some issues with this post, which I have addressed here.  These issues, though, strengthen the argument about strategic deglobalization . . .

§§§§§§

There have been an interesting series of blog posts going around about the issue of price speculation in food markets, and the impact of that speculation on food security and people’s welfare.  Going back through some of these exchanges, it seems to me that a number of folks are arguing past one another.
The most recent discussion was spurred by a post on the Guardian’s Global Development blog by John Vidal that took on the issue of speculation in food markets.  In the post, Vidal argues that food speculation is a key driver of price instability on global food markets, which results in serious impacts for the poorest people in the world – a sort of famine profiteering, as it were.
The weakness of this post, as I see it, are twofold.  First, it doesn’t take the issue of price arbitrage seriously – that is, how speculation is supposed to function.  Aid Thoughts, via one of the comments on Vidal’s post, takes Vidal to task for this.  As Aid Thoughts/the commenter point out, the idea behind speculation is to pull future price impacts of shortage into the present, stimulating responses to future shortages before they occur.  Thus, a blanket condemnation of speculation makes very little sense from the perspective of one who wants to see food security enhanced around the world – without speculation, there will be no market signal for future shortage, creating a world that addresses shortages in a reactive instead of proactive manner. This is a completely fair critique of Vidal, I think.
However, neither Vidal nor those responding to him actually address the evidence for significant market manipulation, and the intentional generation of instability for the purposes of profiteering.  This evidence first emerged in a somewhat anecdotal manner in Fredrick Kaufman’s “The Food Bubble: How Wall Street starved millions and got away with it.”  In this article, Kaufman uses a fairly limited number of informants to lay out a case for the intentional manipulation of wheat markets in 2008.  It is an interesting read, though I argued in an earlier post that it suffers from trying to be a parable for the pervasive presence of complex investment vehicles in the modern world.  And in the end, its findings can hardly be called robust.
Though Kaufman’s argument might, by itself, be less than robust, it received a serious empirical boost from the International Food Policy Research Institute (IFPRI) in the fall of 2010.  In a discussion paper that remains underreported and under-considered in food security circles (trust me, it is difficult to get anyone to even talk about speculation in program settings), Bryce Cooke and Miguel Robles demonstrate quantitatively that the dramatic price rises for food in 2008 is best explained by various proxies for speculation and activity on futures markets.  Now, we can argue about how large an impact that activity had on actual prices, but it seems to me that Cooke and Robles, when taken in concert with the Kaufman piece, have demonstrated that the speculation we see in the markets right now is not merely a normal market response to potential future shortage – indeed, the Food and Agricultural Organization (FAO) of the United Nations has been arguing for months that there are no likely supply issues that should be triggering the price increases we see.  In other words, while it is foolish to simply blame price arbitrage for food insecurity, it is equally blind to assume that all of those practicing such arbitrage are doing so in the manner prescribed in the textbooks.  Someone will always try to game the system, and in tightly connected markets, a few efforts to game a market can have radiating impacts that draw in honest arbitrage efforts.  There is need for regulatory oversight.  But regulation will not solve all our food problems.
But this all leaves one last question unanswered: what is the impact of price instability, whether caused by actual likely future shortages or by efforts to game markets for short-term profits, on the welfare of the poor?  Vidal, Kaufman and many others assume that the impacts are severe.  Well, maybe.  You see, where matters (again – yep, I’m a geographer).  In a very interesting paper, Marc Bellemare (along with Chris Barrett and David Just) demonstrates that, at least in Ethiopia:

contrary to conventional wisdom, the welfare gains from eliminating price volatility would be concentrated in the upper 40 percent of the income distribution, making food price stabilization a distributionally regressive policy in this context.

This finding may be a shock to those working in aid at first glance, but this finding is actually intuitive.  In fact, in my book (out tomorrow!) I lay out a qualitative picture of livelihoods in rural Ghana that aligns perfectly with this finding.  In Bellemare et al, I would bet my house that the upper 40% of the population is that segment of the population living in urban areas and/or wealthy enough to be purchasing large amounts of processed food.  Why does this matter?  This is the segment of the population that typically has the most limited options when food prices begin to get unstable.  On the other hand, the bottom 60% of the population, especially those in this cohort living in rural areas (it is unclear from the study how much of an overlap between poor and rural there is in the sample, but I am betting it is pretty high), has a much more limited engagement with global food markets.  As a result, when food prices begin to spike, they have the ability to effect a temporary partial, or even complete, disengagement from the global market.  In other words, much as I saw in Ghana, this study seems to suggest that temporary deglobalization is a coping strategy that at least some people in Ethiopia use to guard against the vagaries of markets.  Ironically, those best positioned to effect such a strategy are the poorest, and therefore they are better able to manage the impact of price instability on food markets.
In short, I would argue that Marc’s (and his co-authors’) work is a quantitative empirical demonstration of one of my core arguments in Delivering Development:

2. At globalization’s shoreline the experience of “development” is often negative. The integration of local economies, politics, and society into global networks is not the unmitigated boon to human well- being presented by many authors. Those living along the shores of globalization deal with significant challenges in their lives, such as degrading environments, social inequality that limits opportunity for significant portions of society, and inadequate medical care. The integration of these places into a global economy does not necessarily solve these problems. In the best cases such integration provides new sources of income that might be used to address some of these challenges. In nearly all cases, however, such integration also brings new challenges and uncertainties that come at a cost to people’s incomes and well- being. (pp.14-15)

I’m not suggesting Marc endorses this claim – hell, for all I know he’ll start throwing things when he sees it.  But there is an interesting convergence happening here.  I’m glad I met Marc at a tweet-up in DC a few weeks ago.  We’re going to have to talk some more . . . I see the beginning of a beautiful friendship.
In summary, while efforts to game global food markets do exist, and have very serious impacts on at least some people, they do not crush everyone in the Global South.  Instead, this instability will be most felt by those in urban areas – in the form of a disaffected middle and upper class, and a large cohort of the urban poor who, lacking alternative food sources, might be pushed over the brink by price increases.  The policy implications are clear:

  • We need to be watching the impact of price increases on urban food insecurity more than rural insecurity
  • Demanding that rural producers orient themselves toward greater and greater integration with global markets in the absence of robust fallback measures (such as established, transparent microinsurance and microsavings initiatives) will likely extend the impact of future price instability further into the poorest populations.
  • We need to better understand the scope of artificially-generated instability and uncertainty in global food markets, and establish means of identifying and regulating this activity without closing price arbitrage down entirely.
Posted on by Ed 9

A world with less poverty . . . maybe

Brookings has come out with a report suggesting a dramatic decrease in the number of people living in poverty (using the $1.25/day mark as a measure of poverty) since 2004.  The report suggests that where 1.3 billion people met this description in 2004, today less than 900 million are dealing with similar circumstances.  In short, we are on target to achieve the first Millennium Development Goal (MDG) of cutting the global rate of poverty to half of the 1990 rate – indeed, the report suggests that:

the MDG1a target has already been met—approximately three years ago. Furthermore, by 2015, we will not only have halved the global poverty rate, as per MDG1a, but will have halved it again. (p.4)

This is remarkable news.  Brookings notes that the rate of poverty reduction varies dramatically by region, with East and South Asia cutting rates by about 50% between 2005 and 2010, while sub-Saharan Africa’s rate fell just under 8% in that same period.  Further, just two countries can account for the majority of this drop: India and China.  So there are still big challenges out there to be addressed, but things are looking up.
Or are they?
A glance at the methodology employed by this study leads me to think that the error bars on this study are rather huge.  Indeed, the authors are fully aware of the data and analytic challenges related to any effort to estimate poverty levels.  As the authors note, in development

we find it remarkably difficult to measure whether it is happening, and if so how fast. This is especially the case when it comes to producing global poverty data, as the challenges of national poverty data collection are multiplied several times over and then further compounded by the tricky—and unsatisfactory—business of converting national results into internationally comparable terms.

In short, the authors know that the project on which they have embarked is likely to generate estimates with significant potential errors – “error bars” as it were, around their data points, in which reality might actually exist.  Oddly, the report makes no effort to present these error bars.  Instead, it makes rather bold claims about reductions in the level of poverty largely without caveat.  I am not convinced these claims are warranted.
First, there are major data issues here.  Their 2005-2010 measures are predicated on recent household survey data.  Here is the problem with household survey data in sub-Saharan Africa: a lot of it is junk.  I’ve tried to deal with such data in Ghana, a country that has a relatively robust infrastructure for this sort of work, and found their survey data to be a mess.  I suspect that in some regions (Latin America, parts of Asia) the data is actually quite good, on the whole.  But in a lot of places (most of SSA and Southeast Asia) the data is likely very problematic.  And even where the data infrastructure is pretty good, the survey methodologies are often found wanting.  I was part of a team that tried to get a handle on livelihoods near a forest reserve area in Southern Malawi – to do so, we sampled 300 households across four villages (75 households/village) quarterly for a year, to capture things like seasonality in our dataset.  2400 structured interviews had to be undertaken to do this, and those interviews were supplemented by semi-structured interviews with subsamples of the group to explore issues like household power and gender relations to give context to that larger dataset.  This was enormously labor-intensive . . . and necessary to really understand what was going on in those villages.  Most household surveys are not done in this manner, and thus are subject to seasonal bias, or the presentation of data as comparable across the country when, in fact, it has very locally-specific meanings rooted in local social context. I do not expect that all national household surveys will be as rigorous or labor-intensive as ours was, but one should acknowledge the limitations of the data.  No discussion of this in the paper, but that can put a pretty wide margin of error on your findings.
I won’t even wade into the issues with population data that they gloss over in this study – I spend a good bit of time in chapter 9 of Delivering Development talking about census issues and the problems of compounding data error in estimations of economic growth.  Let’s just say that there are significant uncertainties around census data that compound any other errors in the data – again, growing error bars.
Second, there is a moment in the analysis that I found stunning – their projections to 2015 predicated on a surprising assumption – that distribution of wealth will stay the same.  Well, given that economic growth is, by and large, predicated on unevenness within regions, countries and between countries, there is basically no chance that the distribution of wealth will remain the same in any place that is growing.  Generally speaking, the GINI coefficient goes up as growth goes up . . . and a lot of places they are talking about are meant to experience fairly robust rates of growth now and in the near future.  More error.
What does this mean?  Well, to me it means that the data they presented like this:

Really has a wide margin of error, even for past observed data (but compounded going forward) that should look be presented like this (with margins of error in red, and not to scale.  I did not calculate them, as this is just illustrative):

OK, so perhaps there should have been some error bars in there.  So what?  Well, this is a policy brief, with policy recommendations that might actually be followed by someone . . . and this brief is arguing that we are on top of the whole poverty reduction thing, which is sure to become an argument for looking for ways to trim development budgets.
Even if the budgetary ax does not fall because of this brief, there is a risk of reprioritization that may not yet be appropriate.  In the recommendation

aid donors must adapt to the evolving poverty landscape and update their policies and programming to reflect current needs and priorities


the brief implicitly argues that agencies should be reevaluating their programming based on the findings in the brief – toward a focus on Africa and fragile states, and away (apparently) from much of Asia and those parts of Latin America, the Caribbean, and the Pacific where we currently work.  However, this is a recommendation based on much thinner evidence than it seems.
The worst part is that I think this presentation of the data undermines one of their excellent policy points:

One final policy recommendation revealed by this analysis is the need to improve the quantity, quality and timeliness of poverty data, at both the national and the global level. For both developing country governments and aid agencies working to fight poverty, it is impossible to efficiently allocate resources toward this goal using poverty data that is incomplete, unreliable or out of date.

At the country level, there has already been a significant uptake in the use of household surveys and an improvement in their quality. Yet in remarkably few countries is there a standardized, recurrent—and therefore consistent—approach to household survey data collection and analysis.  A renewed, long-term commitment to build capacity in domestic statistical agencies would be a valuable use of aid agencies’ resources.

I agree completely, and have argued for this need, but by presenting the data as so clear and robust, they have essentially undermined this argument.  Any policy maker looking at this will wonder why s/he should give more funding to something that already works . . .
Folks, policy makers will never learn to deal with uncertainty until they are faced with it . . . if we keep copping out and “firming up” mushy results into single bold trendlines, they will expect certain outcomes from uncertain data indefinitely.

Posted on by Ed 1

Liveblogging Dead Aid (Chapter 3)

And the beat goes on . . . ladies and gentlemen, Chapter 3.
p.29: Well, so much for starting brightly.  She has grossly oversimplified Diamond (which is hard to to, y’all) to argue that a country’s wealth and success depend on geography and topography.  Er, no, that would be a form of environmental determinism.  Diamond was writing an anti-racist history of the world, explaining how the conditions that would eventually result in the ability of some groups to colonize others, etc., was enabled by environmental and geographic situations – but Diamond does not simply erase colonialism from the equation, he is trying to set the stage for how it came about.  You could argue that he has a somewhat environmentally determinist take on the causes of colonialism, maybe . . .
Oh, and for Diamond’s purposes, Africa was not resource-rich . . . it lacked easily domesticable crops and animals when compared to other world regions.  The whole discussion of squandering natural riches on page 30 is a total non-sequitor in the context of Diamond.
Note: I really don’t love Diamond’s book . . . and I am defending it here.  Ugh.
p.30: OK, the geographer in me just screamed.  I can’t blame Moyo for this – it is all about Collier, who along with Sachs and a few others in the field of economics is slowly resurrecting environmental determinism (or at least geographical determinism) with their damn correlations between coastline, endowment of natural resources, and economic growth.  The connections between these three issues are so complex that any analysis that simply divides countries into three categories (resource poor/coastline, resource poor/no coast, resource rich) is going to over-aggregate different relationships and causes into gross oversimplifications and false correlations.  Further, the damn N for these analyses is going to be less than 20 for one or more categories (less than 60 countries in Africa, folks).  I mean, you can run non-parametric stats on this sort of thing, but for the love of God, why?  Just do the qualitative work, dammit.
p.31: Moyo seems to have completely and utterly missed the reason why colonialism had such a brutal impact on African development.  Sure, artificial countries were not great.  And the inherited governmental structures after colonialism often caused problems.  But this sort of thing only really mattered after independence.  By then, these places had been completely restructured into sources of primary materials for the industries of the Global North – infrastructure, agricultural innovation, etc., all of it was aimed at enriching someone else and ensuring the colonized never developed any economic power of their own.  This led to the perpetuation of colonial relationships by other means after independence (neocolonialism), and I have little doubt this is way more important than the borders or governmental structures when we try to understand the growth trajectories of Africa since independence.  Either she is stunningly ignorant of her own country’s history, or this is a very disingenuous reading of African history.
p.32: Wonderful, Paul Collier postulates that the more ethnically divided the country, the more likely the prospect of civil war.  In other news, people with guns are more likely to shoot one another.  How much more likely?  Is this a cause unto itself, or a variable mobilized to political ends that can be better explained by another variable (I’m looking at you, Rwanda)?
p.34: If you are going to use Botswana as an example of a place where growth and development were facilitated by good institutions (which it was), you still have to contextualize the huge growth numbers by noting the GIANT DIAMOND MINES in the country.  I’m just sayin’.
p.35: Nondiagnostic diagnoses make me crazy.  “Africa’s failure to generate any meaningful or sustainable long run growth must, ostensibly, be a confluence of factors: geographical, historical, cultural, tribal and institutional.”  Again, no kidding.  This is meaningless.  Of course, it also discounts her previous example of Botswana having meaningful economic growth. Or Ghana. Or South Africa.  In other words, her whole statement is an overgeneralized negative that doesn’t hold up to scrutiny (or, in fact, her own argument from a page ago).   Next part of the diagnosis: “No factor should condemn Africa to a permanent failure to grow.” I don’t know of anyone making that claim.  If we were, we wouldn’t really bother with development, would we?  We’d just give up and walk away . . .  And the final part: “for the most part, African countries have one thing in common – they all depend on aid.”  Er, and colonialism (except maybe Ethiopia, and then mostly on a technicality.  And don’t tell me about Liberia – for God’s sake, we carved the place out to resettle freed slaves).  And colonialism has a lot to do with what CAUSED the situations we now address with aid.
I cannot, for the life of me, understand how she is ignoring this.
p.40: Yes, I am skimming a bit here.  That first bit really killed me.  But here I can give her some credit for hammering the “democracy gives us development” crowd – at least that portion of the crowd who thinks the relationship is simple.  It is not, of course, and some of the new thinking on this examines how, for example, governments can make difficult decisions that balance needed reforms/changes and their electoral interests.  But sadly, much of the mainstream writing on the subject tends toward the simplistic.
p.42-43: OK, I am now uncomfortable with what seems to be a bit too much lauding of dictatorships.  Yeah, they produce great growth numbers, but growth is a means to an end . . . improving the human condition.  Dictatorships tend to create large tradeoffs in quality of life that seem, on balance, to have negative impacts on their populations.  Not a lot of Chileans think back on Pinochet as the good old days, you know?
p.44: Moyo is quite right – the timing of aid, and inappropriate aid, can do much more harm than good.  For example, having food aid arrive nine months after a famine (not all that uncommon), just as the new harvest comes in, crushes local food prices (oversupply of free food drives prices of locally-grown crops) and re-impoverishes the local farmers.  But this is not an inherent problem of aid – this is about timing, something people are well aware of, and trying to address.  Further, Moyo’s complaint about celebrities bringing mosquito nets to the continent, and thereby putting local producers out of buisiness – while valid – steps outside her definition of aid (government-to-government transfers) that she laid out earlier in the book.  Apparently her terms of reference are not stable.  Super.
p.46: Moyo does not know what I feel in my heart of hearts, despite her claims – I do think aid can work.  Her evidence against it has to do with aid’s impact on various economic indicators.  But this is just means to an end, and does not capture many of the benefits of aid in a clear manner (reduced illness means a better quality of life, and might be partially captured in a growing GDP via the extra days the individual can work . . . but maybe not very clearly).  This isn’t to say that aid is perfect.  Hell, I wrote a book arguing that we don’t really know what it is we are trying to fix in much of the world, so I have my issues with aid and development.  I just want an honest reading of their impacts and drawbacks.

Posted on by Ed 1

Liveblogging Dead Aid (interlude)

The liveblog of my reading of Dead Aid will continue shortly.  However, it is worth passing along links to several really good critiques of the book, published elsewhere:
Lawrence Haddad from IDS has a review on his Development Horizons site (thanks Andy Sumner from IDS for the heads-up).
New friend Owen Barder (thanks again for the birthday drink!) has an outstanding, brutally detailed review on his personal site.  This link is to a short summary review, but he has a very prominent link to the longer review on this page.  Read it.
A very thin review from The Economist
And finally, a hugely important review from the blog Zambian Economist (thanks Ryan Briggs for pointing me to it).  Why is this review so important?  Well, besides its serious detail, it is written by a Zambian, thus undermining the argument that all of these critical reviews are just the development community beating down a voice from the Global South.
Given this body of reviews, why continue liveblogging?  Well, each of these reviews takes on the whole book, but is limited in size and scope (Owen’s megareview notwithstanding), whereas I can leisurely point out issues as I come to them without worrying about length if I go chapter by chapter.  Second, I think the liveblog gives some insight into how a critical reading of the book might go as it happens . . . or maybe you all just can see my mind at work.  In any case, I think there is something of value here, at least until you all tell me there is not.

Posted on by Ed 0

Don't tell us the food price index is rising! Tell us why . . .

The rising price of food has been a subject of many news stories over the past few months, with the intensity of attention ratcheting up recently upon news that the FAO’s food price index has just surpassed its 2008 peak.  Stories about this issue – well, at least the good stories – point out the highly variable way in which this increase in the price of food has played out in different places.  One good example of this sort of reportage is from Saturday’s Washington Post.
This variability, however, tends to be illustrated instead of interrogated, with explanations remaining remarkably shallow (see my earlier complaints about how explanations related to “local specificity” and “cultural difference” tend to obscure important processes and blame the victims of larger processes).  However, a quick examination of the information we have about food prices and their impacts points to the fact that global food prices are not all that useful for understanding the variable food outcomes we see in the Global South.  First, we have to understand that the increase everyone is talking about is in an index of food prices – that is, the price data drawn from a number of different foods.  Though the index is going up, this does not mean that the prices of all foods are rising equally.  As the WaPo and others have noted (and is quite clear in the FAO presentation of the data), when you disaggregate the crops and their prices, the biggest increases globally are in sugar, cooking oils and some fats (there are, of course, local surges in price for particular crops, but those are often independent of the larger global markets).  While cereal prices are increasing, they are not rising as quickly as these other foods, and they remain below 2008 levels.  So who is hit by these prices has a lot to do with who consumes sugar, or products heavily constituted by sugar and oils.  Oils are widely distributed in diets, but sugar is not – the poorest tend to have the least access outside the Global North (ironically, this is reversed in the Global North, as noted by Fast Food Nation and Morgan Spurlock’s Super Size Me).  Meanwhile, staple crop prices are not rising anywhere near as rapidly.  So the principal drivers of the rising price index are not a huge portion of the diets of those in Global South . . . with one key exception: urban populations.  More on that in a second.
Second, who is hit by these prices has to do with the degree to which producers and consumers are linked to global markets.  Many rural producers are consumers of their own produce, or the produce of their neighbors.  As a result, they are somewhat insulated from shifts in commodity prices.  I’ve seen this at work in Ghana firsthand – it is a disaster for incomes in these areas, but not for food security.  Instead, people just eat the crops they might otherwise have sold at market.  Of course, this comes with other costs, such as in terms of the purchases of needed household goods, and sometimes in terms of children’s education (in places where school fees are still charged).  But in terms of food security, not so much.  FEWS-NET has offered this same interpretation of the impact of rising food prices on the countries in which it operates, arguing that this increase in this index is not as worrying as what we saw in 2008.  This is one of those instances where integration with global markets, long seen as a goal of development programs and a clear pathway to prosperity, can also produce significant new challenges for the global poor . . . or at least that segment of the rural poor whose livelihoods and production are highly integrated with global markets.
So, where people are dependent on global commodities that are internationally sourced for their food or incomes, shifting global food prices are more likely to result in direct shocks to their food security.  While there are certainly rural populations that fit this description, once again it is the urban poor who are most generally and directly exposed to this challenge.  With little food production of their own, they are dependent on purchased food that has passed through one or more middlemen from the source of production.  By definition, their food supply is more commodified, and more connected to global markets, than most of their rural counterparts.
Therefore, there isn’t a whole lot of point to looking at global price indexes to understand the relationship between these prices and food insecurity.  Instead, we have to look at who is affected by these prices, and how – the connections are complex and often involve tracing what appear to be unrelated factors as they radiate out from these price changes.  This is the only way to appropriately design interventions to address these issues . . .
Don’t tell us that the food price index is rising – tell us why it is rising . . . then we can do something about it.

Posted on by Ed 1

Poverty reduction and development: it's not either/or

A piece on the Guardian‘s Poverty Matters Blog today sets up one of the oddest, and most pointless, dichotomies I’ve seen in a discussion of development.  To summarize, the post by Rick Rowden argues that a focus on aid effectiveness and poverty reduction

perpetuates a bloated aid industry that doles out millions of dollars each year to legions of contractors and NGOs to carry out projects in dozens of poor countries.

What it does not do, apparently, is work toward any definition of development

In recent decades, earlier notions of development economics have been replaced with meeting the MDGs. But poverty reduction is not development. We seem to have suffered collective amnesia about the history of development, which used to be widely understood as industrialisation – in which poor countries undergo a transformative process out of primary agriculture and extractive industries into manufacturing and services industries with higher value-added over time.

First, this is an absurdly reductionist definition of development.  If Rowden wants to talk down to his readers about the history of development, he’d do well to note that his particular take fell out of currency in the late 1960s because IT DIDN’T WORK.  There is a reason modernization/big push theories fell out of favor (unless you are Jeff Sachs, and then you are forever reviving the corpse of the big push at the community level via the MVP.  Then again, Sachs doesn’t seem to read development history, either).  In short, the borrowing required for industrial ramp-ups almost never paid off with enough revenue to pay off the loans.  To understand why this happened is to understand the country-specific interplay of three key factors.  First, there were (and still are) structural issues in world trade that locked much of the developing world out of key markets.  Second, these policies failed because markets were dominated by large corporate entities operating with very small margins because of their huge economies of scale, basically undercutting any new competitors on price because they had the advantage of a huge head start provided by colonialism.  Third, massive corruption within countries drained the productive capital out of these loans, dooming the projects there were meant to fund.  Countries had to address either two or three of these factors, in varying ratios, at different times.  Modernization theories pushing industrialization had little to offer in addressing them.  This is why we eventually saw the rise of an attention to institutions and governance in development – not just at the level of the state, but also in markets and broader trade arenas.  It is also why so many countries in the Global South found themselves saddled with crushing debt at the end of the last century – many of those debts were the original loans and continued accumulation of interest tied to these failed policies.
The other issue is that industrialization requires resources (to make products) and consumption (to sell them).  At a time when our demand on the natural environment is already beginning to overshoot its capacity to serve our needs, asking countries to take on even more unsustainable activities is an absurdity that will end in failure.  There is nothing sustainable in this pathway – and if you look at the post, you will see that the entire argument is framed in an unlimited world, where the only constraint on development is growth:

If countries are unable to use the industrial policies they will need to transform their domestic industries, diversify their economies and build up their own tax bases over time, how will they ever get off the foreign aid bandwagon? Here the “poverty reduction” discourse is misleading; it neglects to ask how countries are supposed develop without industrialising.

Well, that isn’t totally true unless you take a very, very narrow reading of the poverty reduction discourse.  A lot of us are working in this space to imagine alternatives.  Indeed, there are community level projects that, while not elevating people to the standards of living seen in the Global North, have created sustainable, substantive changes in the quality of residents’ lives.  The examples are out there if people want to look.
Beyond all of this, though, is the larger issue – Rowden clearly has no idea what he is talking about when it comes to development when he dichotomizes poverty reduction and development.  Even if we saw economic growth as the be-all, end-all of development, there is a lot of work out there arguing that endemic poverty is a huge drag on economic growth and therefore has to be addressed as part of a growth package (see the OECD Observer here).  So even in a fairly reductionist view of development, you need poverty reduction . . . and I don’t know anyone who believes that growth adequately addresses poverty.  Not even at USAID.  Really.
So poverty reduction and development are not an either/or proposition, from any reasonable perspective on development.  Rowden’s piece would have been interesting . . . in 1960.  I have no idea what the point was in publishing it today.

Posted on by Ed 9

Development isn't impossible, just hard to understand

A few comments on the blog related to some earlier posts on a Grand Challenge for Development have gotten me thinking a bit about development (the concept and the project) and if it is achievable.  There are those who would argue it is not, that development is an ill-conceived idea that invokes pathways of change that are now closed due to the changing global political economy, and treats life in the advanced economies as the apotheosis of human existence toward which everyone else is (and should be) marching.  To the extent development is taken to mean this sort of change, I agree completely – development is unattainable and meaningless.  There are not enough resources on Earth to allow everyone to live the way we do in the advanced economies, so the idea of a march toward that standard of living as a goal is gone regardless of how one might feel about it morally/ethically/etc.
But that does not mean that change cannot happen, that things cannot improve in a manner that is appreciated by people living in particular places.  Certainly, a shift from a post-subsistence income of $1 a day to $5 a day is a huge change that, in many parts of the world, would enable very different standards of health, education and well-being.  Surely this is worth striving for – and certainly, the people with whom I have worked in Ghana and Malawi would take that kind of a change over no change at all – and they would much rather than kind of change, than endless, pride-killing aid dependence. There is no doubt that this sort of change can be attained in many, if not most places.  Indeed, it has been accomplished.  Further, there are places where life expectancy has risen dramatically, infant mortality has fallen, nutrition and education levels have improved, and by any qualitative measure the quality of life has improved as a direct result of aid interventions (often termed development, but this should only count as development if the changes are sustained after the aid ends).  The real question at hand is not if it can be done, but why the results of our aid/development efforts are so erratic.
You see, for every case of improved life expectancy, there is the falling expectancies in Southern Africa.  For every case of improved nutrition and food availability, there are cases of increasing malnutrition and food insecurity (such that in sub-Saharan Africa, the balance has tipped toward less food availability per capita than two decades ago), and so on.  What works in one place often fails in another.  And the fact is that we don’t understand why this is in a systematic way.  I am a geographer and an anthropologist, so I am quite sympathetic to the argument that the local specificity of culture and society have a lot to do with the efficacy of particular interventions, and therefore explain a lot of the variability we see in project outcomes.  However, “local specificity” isn’t an answer, it is a blanket explanation that isn’t actionable in a specific way.  We persist in this answer because it pushes development (and aid) failure into the realm of the qualitative, the idiosyncratic.  And this attitude absolves us, the development community, from blame when things don’t work out.  Your project failed? Ah, well, who could have known that local land tenure rules would prevent the successful adoption of tree crops by women?  Subtly, we blame the victims with this mentality.
What it comes down to, I think, is a need to admit that we have at best a shaky idea of what works because in many areas (both geographic and technical) we really don’t understand what it is we are trying to transform when we engage in aid and development work.  We are better in some areas (health) because, frankly, they do a better job of gathering data and analyzing it than we do in, say, rural development (hey, don’t take my word for it – read some Robert Chambers, for heaven’s sake!).  But, in the end, we are driven by our myths about how markets and globalization work, how development/aid is linked to change, and how the problems we claim to address through development and aid came about in the first place.  This argument is the heart of my book (Amazon link here) – and I spend the first half using the story of two villages in Ghana to lay out how our assumptions about the world and how it works are mostly wrong, the next quarter explaining why this is a major problem for everything from economics to the environment, and the last quarter thinking about how to change things.
My take is but one take – and a partial one at that.  We need more people to think about our assumptions when we identify development challenges, design programs, and implement projects.  We need to replace assumptions with evidence.  And we need to be a lot more humble about our assumptions AND our evidence – so we stay open to new ideas and evidence as they inevitably flow in.

Posted on by Ed 3

Is the Aid/Development divide the Grand Challenge for Development?

A few conversations on the blogs over the past two weeks have me thinking about the divide between aid/relief work and development – one of those minor issues I am supposed to be addressing in my current job.  I am nothing if not ambitious.  However, as folks have tried to clarify the difference between aid and development, I’ve become more and more uncomfortable because I really think these two areas need more blending, not more distinction.
And so now I am wondering if, in fact, the gap between aid and development is part of the reason so many “development” projects don’t work out.  I put development in quotes there for a reason – most of these projects never actually get to the development phase.  Take my ongoing rants about the Millennium Village Project.  Here is an ambitious program of interventions that is meant to be a development project.  However, at this point it is really an aid project – at least by the definitions I am seeing circulate.  The MVP is still completely dependent on external interventions and expertise for its outcomes.  Where it seems to me the MVP falls down is in the transition from the aid phase to the development phase, when these changes in people’s lives become self-sustaining, and engender new changes that do not require any sort of external intervention.  In short, the MVP seems to assume that with enough aid over enough time, change becomes self-sustaining and the processes necessary to bring about well-being spontaneously emerge.  This is what I like to call the “then a miracle happens” moment.  As in:
Dump money, aid and material into a place over a series of years –> then a miracle happens –> change is self-sustaining
The MVP is hardly the only project guilty of this – hell, this thinking is endemic to development.  We can back up to Rostow’s Stages of Growth in the 1950s (at least) and find the exact same fallacy.  Big push/modernization theories, the Washington Consensus, basically every program founded on the core idea that economic growth drives everything else, they all suffer from this fallacy.  This, ladies and gentlemen, is your grand challenge for development – the “big question” that could really change how we do what we do.  We need to articulate how our initial interventions, our “aid”, is/can be transformed/built upon/leveraged/instrumentalized/whatever to result in the self-sustaining changes we see as development.

Posted on by Ed 11