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Tyler Waldman
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The answer to (almost) all of the questions in development economics seems to be “it depends.” However, this paper clearly illustrates that foreign aid tends to have a significant minimizing effect on the level of poverty within a country, using the multidimensional poverty index. I completely agree with the authors’ opinion that using the MPI instead of income to measure aid’s effects on poverty is viable and perhaps even better. Foreign aid does not, and usually should not, translate to money going directly into the pockets of those in need. Investments in public infrastructure and other public goods can often be the most effective use of funds (as we saw with land grant institutions, for example). Since the MPI more accurately depicts the capabilities of those living in poverty, I feel that Amartya Sen would agree with its use as an indicator of whether foreign aid contributes to poverty alleviation. The organization that sponsored this paper and contributed the original data set is the Oxford Policy and Human Development Initiative. After looking around their website for a bit (https://ophi.org.uk/) it seems that their objectives follow our class very closely. For example, one of their most recent papers is titled: “Distributional Impacts of Cash Transfers on the Multidimensional Poverty of Refugees: The ESSN Programme in Turkey.” The authors find that this unconditional cash transfer program has reached 1.8 million refugees in the country and has an enormous effect on alleviating multidimensional poverty. The OPHI is contributing extremely relevant work to the field of development economics and I enjoyed looking at the most recent developments in the field on their website.
Toggle Commented Dec 7, 2022 on Paper for Friday at Jolly Green General
The dichotomy of the Progresa program’s effects on women and men was one of the key findings of Parker and Vogl’s work. Making policy decisions for a program that undoubtedly benefits one group of people over another presents an interesting dilemma. This relates to Esther Duflo’s paper on literature regarding Women's empowerment in economic development. To advance the role of women in an economy (and therefore promote economic development) there has to be a trade-off of resources for men. It’s also akin to the literature on sustainability in economic development: to preserve resources for the future, we must use fewer resources in the present. All of these examples highlight the difficulty of making trade-offs and underline how economic policy underscores what policymakers truly prioritize. The paper says that one of the secondary goals of the program was to advance gender parity in education. If those with power in the Mexican government want to continue this excellent promotion of the role of women in society, they would increase funding for Progresa and continue the successful program. I couldn’t easily find data on the program’s funding, but it’s safe to say the Covid pandemic could divert attention away from funding a social program like Progresa. I’d be interested to see how Progresa evolves over time and if the effects will compound as consecutive generations have access to education and health care. As of January 2020, Mexican women had the second lowest labor market participation rate of all OECD countries. Will the program continue if Women reach similar levels to men in education and employment?
Toggle Commented Dec 1, 2022 on Paper for Friday at Jolly Green General
This paper provided a great overview of the link between education, private benefits, and societal benefits. Its conclusions were eerily similar to the land grant institution paper we read earlier in the semester. That paper found that investments in agriculture-focused colleges have a 32:1 return on investment, while this one finds a general 10.5:1 rate of return on investments in education. They both beg one to ask why these avenues are not being funded more in light of this significant evidence of their impressive returns to any funding. This paper also backs up Esther Duflo’s findings that investments in women and girls may be the most effective way to stimulate economic development. It’s interesting to see how this paper, while covering a new topic for our class, continues to reinforce the same messages that previous papers have touched on earlier in the semester. When looking at the annex, I noticed a huge discrepancy in the most recent year of observed data for the countries in annex 1. This paper was written in 2018 and the most recent data for some countries, like Sierra Leone, is as far in the past as 1971. Many others have the most recent data collection in the 1980s. This seems like a major flaw in our ability to study important issues in economics, especially if there is a correlation between the economic level of a country and the availability of data for it. As Ted Schultz would say, “if we knew the economics of being poor, we would know much of the economics that really matters.” How can we know the economics of being poor if we don’t have sufficient data to study less developed countries? It is possible that this particular data set is more restrictive than others or the authors are purposefully using older data to measure long-term effects; both explanations would counter my point. However, data availability is certainly an issue to consider, and looking at the data put forth in the annex made me consider this issue.
Toggle Commented Nov 10, 2022 on Paper for Friday at Jolly Green General
One of the key takeaways from this article is that the role of women empowerment in economic development has not yet been fully completed in any country in the world. Under the veil of economic development, I think it’s extremely easy to focus attention on increasing the rights of women in lower developed countries. While that goal is just, it remains important to discuss the effects of women empowerment on economic growth in highly developed countries as well. The study that jumped out at me from the paper was that girls typically performed worse on math exams due to internalized biases about their respective math abilities. Duflo states that “As long as these biases persist, gender equality will be hindered even if the technological conditions for an even playing field are met.” I agree with Duflo that the number one reason to rectify these wrongs is to create and live in a more just world. Another reason is It’s impossible to quantify the effects that these social ideations have had on economic growth and human development. Needless to say, when you stymie the intellectual capabilities of the (probably) smarter half of the population, you lose all the development those minds could have produced. One aspect of the reading that I would like to discuss more in class is how access to abortion contributes to sex-selective abortion. Before reading this paper, I had never learned about this phenomena. How can policy protect the right of women to receive an abortion while simultaneously discouraging sex-selective abortion? Unfortunately, the seemingly best answer to this question may be to change societal perceptions of gender and create a more equal society: I say unfortunately because that “policy” seems impossible in today’s world. I wonder what ideas are out there and if others have encountered literature that confronts this issue.
Toggle Commented Oct 20, 2022 on Paper for Friday at Jolly Green General
This paper contains many interesting traits that should be discussed. The first is that the author is a historian, as opposed to an economist. Seth’s perspective as a historian adds a great deal of intrigue to the paper and makes it distinctly non-economic. Yes, the paper does discuss the economic development of South Korea and defines growth strategies utilized by the country. However, Seth emphasizes political leadership, the benefits, and the detriments of democratization, along with international politics to explain the reasons why South Korea chose the specific strategies they did. This perspective can be contrasted with an economic analysis of the effects of the policies that were chosen. It’s important to understand why countries decide to use particular strategies to develop because that knowledge gives predictive power for the future. Also, understanding why some strategies are chosen can give insight into their chances for success when employed in other situations. It is extremely easy to understand this paper in the context of the Solow model of growth. Much of the actions of South Korea’s government were completed to shift the Y=A(K) function upward. This can be seen through educational development, the development of public health, and their emphasis on technological development. An interesting part of this piece was learning about the United States’ role in funding Korea’s development. With US dollars, South Korea was able to focus on shifting the curve upward while not worrying about funding capital deepening. This dependence on FDI was disdained by South Koreans, but economic interdependence between countries is essential for growth and economic efficiency. My last short point is that South Korea copied many strategies used by Japan to stimulate growth. We talked about how policies must be context-specific to work, but it seems like South Korea’s copying of Japan was successful. Maybe there is a regional aspect to the efficacy of copying other countries’ growth strategies.
I feel that this article doesn’t fully embrace the nuances associated with the study of institutions in economic literature. If I were to only read this article, I would think that institutions are essentially macroeconomic strategies used by governments to achieve growth. In contrast, I believe that institutions can be more easily understood as the “rules of the game” within an economy. I recognize that definition is less congruous with growth at the national level than macroeconomic strategies employed by governments. However, it most closely fits the role that the broad economic literature places on institutions. I’d love to talk more in class about how institutions affect economies on a more micro level through property rights, contract enforcement, and legal systems. Another interesting aspect of this paper is the lack of empirical work. For the previous blog post and discussion, we talked about how ideas that aren’t formalized get forgotten. In this paper, the authors simply describe what they have observed in the world without formulating a model to explain other ideas. I feel that this type of analysis has value- however, economists like Paul Krugman might disagree. Articles that float ideas regarding the world fall in line with high development theory of the 1950s. As Krugman would say, these authors are leading their ideas out into the wilderness to die. This paper only provides supportive evidence for its conclusion- it does not convince me of a causal link.
Toggle Commented Sep 29, 2022 on Paper for Friday at Jolly Green General
Upon reading this article, I kept coming back to the same question: how does the movement of economics in a formalized, mathematical direction affect potential economists that are not inclined toward math? I agree with the author that formalization may be the best strategy to develop the field of economics in the long run. The ability to predict the effects of various actions is the key contribution of economics in many fields. However, the “high development theory” that Krugman says will lead toward professional exile may be the key to solving some of the world’s greatest issues. When we aren’t thinking about the world in an innovative way, formal models won’t lead in the best direction. The key issue with this line of this is directly voiced by Krugman in the paper. He asks those with lofty goals and a lack of motivation to formalize their ideas if “... you [are] sure that you really have such deep insights that you are better off turning your back on the cumulative discourse among generally intelligent people that is modern economics?” My response to that question would be those with those deep insights may have already left the field due to its heavy focus on formalization. There is balance in every discipline, and the field of economics is incredible because of its unique place between hard sciences and humanities. I think that straying too far one way will always have advantages and disadvantages, and weighing them is crucial for the future of the field.
Toggle Commented Sep 22, 2022 on Paper for Friday at Jolly Green General
I found the reading about the Sustainable Development goals interesting from a variety of perspectives. Whether viewing them as the evolution of internationally supported projects, a glimpse at the current and future world issues we have to grapple with, or as an interdisciplinary mechanism to better the world around us, there are many lenses through which one can analyze the SDGs. What interests me the most about them is the ethical classification of the environment as a tool to be used by humanity for survival. Throughout the history of ethical philosophy, non-human objects have been valued only through their relationship to humanity. Many of the most prolific philosophers of the past have deplored the idea that the environment can have intrinsic value. The most clear of these ideologies comes from Immanuel Kant, an 18th century German philosopher. His main ethical philosophy is that one ought to respect the humanity of others and act rationally in accordance with this principle. Put simply, one must not impede others from exercising their free will and achieving the ends to which they aspire. This ethical framework bestows little to no value upon objects or living organisms that have a lesser ability to exercise free will than humans do. In fact, it may imply that humans should be able to use the environment in whatever way they see fit to achieve their personal goals so long as it does not directly hinder others from achieving their goals. Of course, one could argue that wanton misuse of the environment negatively impacts the abilities of others to meet their ends. However, my objective here is to point out that under Kantian ethics, the environment has no intrinsic value. (Most other ethical frameworks bestow value broadly on human happiness and agency, including Utilitarianism and Rawlsian ethics) So, how does the above point tie into the Sustainable Development Goals? When reading the goals, you’ll notice that there is general emphasis on the use of the environment to ensure humans can continue living comfortably on Earth. SDG 1 references that “people” will have access to all the infrastructure and basic necessities they need to live fulfilled lives. SDG 2 references the environment, but later states that its environmental goals serve the purpose of “[enabling] humanity to avoid the most dangerous planetary thresholds.” SDG 3 and 4 also center their objectives on supporting people. I believe these goals align with prior ethical frameworks in implicitly denying the inherent value of the environment. It is possible (and likely) that the contemporary allocation of inherent value to people alone is a direct result of prior ethical frameworks. However, I would like to see more of a focus on saving the environment for the sake of saving the environment: regardless of how that might benefit humanity in the long run. We can debate whether the environment actually has value in itself (and the magnitude of said value in relation to people), but I believe that it is ethically unsound to only care about the environment in how it relates to our personal well-being.
Toggle Commented Sep 14, 2022 on Paper for Friday at Jolly Green General
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Sep 14, 2022