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How does Owen Barder define development? How does he extend Amartya Sen’s definitiion to include the idea of complexity? In his podcast on development & complexity, Owen Barder describes human development as the gradual growth of both economies and the social circumstances healthy markets encourage. Most importantly, Barder’s explanation of development is critical of a purely firm-based examination of development; he argues that many models used in the past have ignored the complex nature of institutional connectivity that is inherently involved with the evolution of any one factor of society. He uses the example of Thomas Thwaites toaster project as evidence of the necessity of arrayed consideration, pushing listeners to realize that building any kind of project requires the nurturing of systems – not just individual firms – to create social health. In this sense, Barder extends economist Amartya Sen’s definition of development from simply acknowledging the existence of its multifaceted parts to actively considering the interdependence of these parts.
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? Thomas Thwaites was a British university student who attempted to create a toaster from entirely self-produced individual parts. This involved entirely deconstructing an existing incarnation of the device, analyzing the composition of every tiny part, finding creative ways to replicate these pieces’ integral constitutions, and constructing his reproduced toaster components into a semblance of workability. Ultimately, he was only able to make his toaster work for about five seconds before it burst into flames and melted. This example of a “development project” is important because it highlights the importance of understanding the connectivity of individual parts. Although Thwaites did his best to accurately replicate each component of his toaster from home to a T, he had no formal knowledge of electric engineering, nor did he have the productive abilities of a computerized factory line. He took an external approach to his endeavor and though he was able to create a superficially-viable model, he suffered the consequences of surface-level development when the device was activated. Thwaites’ relative failure demonstrates the necessity of deep learning and understanding as it relates to development and highlights one of development’s most vital defining aspects – its inherent complexity.
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? In the past 50 years, the world has overall experienced significant economic growth. Even countries “left behind” in the developing world have been able to achieve better human welfare for their respective populations. However, huge fiscal variances between regions with similar incubatory circumstances indicate that traditional economic models cannot predict, explain, or accurately illustrate the success of certain locales above others. This juxtaposition is evident in Barder’s comparison of South Korea and Ghana, two countries which, in 1950, held similar positions in terms of development levels but by 2010 were leagues apart economically. (To clarify, while financial growth should not be relied upon as the only dog whistle signal of “perfected development,” its appearance does consistently correlate with the achievement of other development benchmarks.) Overall, the differences between South Korea’s booming economy and Ghana’s struggling growth demonstrate that most external factors believed to be vital to the process of development are, in fact, endogenous components. By extension, this conclusion invalidates the idea of a “missing ingredient” necessary for “cure-all” approaches to improved institutions.
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 is an economic growth model developed in the mid-20th century and heavily-referenced as explanatory of development issues until the 1960s. This particular model included two fundamental variables, without which financial growth and thus, development could not be achieved: capital and labor. In the environments analyzed by the Harrod-Domar model, proportional amounts of capital and labor were the only two things necessary to create output and generate growth. It incorrectly assumed that countries that “failed” to develop merely lacked the capital to do so, ignoring the covariate factors of social welfare needed to create sustainable development. Walter Rostow’s economic model took the lead over its predecessors’ explanations for development during the 1960s as the most concise model of localized development. Rostow, an economist who published The Stages of Economic Growth in 1960, believed development to be a “virtuous cycle” relying on the “concentric” relationship between investment, capital, output, incomes, and savings. Increasing one factor would create a snowball effect until development was reached. Though not entirely correct in his approach, Rostow’s model did a better job at explaining the connections between endogenous resources and capital outputs than the Harrod-Domar approach.
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? Robert Solow’s model emerged in the 1950s as a composite form of accounting that broke down development into the growth of labor, capital, and the increase of an unexplained “magic ingredient.” According to Solow’s model, the divergence between rich and poor countries could all be explained by the lack or negative growth of an indescribable category of “technology” in the nurturing of developmental factors. Solow attempted to address the limitations of the Harrod-Domar model by acknowledging the failure of a binary explanation of development. Though his understanding of a multi-factored approach to development did a better job of predicting growth than the Harrod-Domar model, it still failed to accurately encapsulate what else is necessary for development beyond a nebulous “magic ingredient.”
What was the Washington Consensus? How did it propose to improve upon models of economic growth? The Washington Consensus was born from an extended discussion on global development conducted by politicians in D.C. during the 1970s, in which experts concluded that it was flawed policymaking, not modelling, that prevented the growth of developing countries. This conclusion led the World Bank and the IMF to propose a series of strict policy reforms for “third-world” countries, which they compiled into a neat list of 10 items that came to be known as the Washington Consensus. This approach to understanding development improves upon previous models in a similar manner to Solow’s. By considering non-economic factors of growth and sustainability, the Washington Consensus was able to provide a (somewhat) better image of the reasoning behind slowed 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 Nigerian Ajaokuta Steel Works is an example of poor investment management on the part of development experts and an absolute failure to understand the impacts of institutions above policies on the process of development. Billions of U.S. dollars were funneled into the creation of this factory, which has produced virtually no profit to the Nigerian people and government due to “endemic corruption” and ineptitude in the management of fiscal investments. Ajaokuta marks an important shift in the world’s understanding of development – rather than continuing to funnel money into flawed designs for the production of output based on a binary capital-labor system, most development experts now recognize the importance of supporting healthy fiscal and social institutions prior to the facilitation of economic growth through tax-cutting policies and the like.
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? Haile Sellasie was a ruler of Ethiopia whose luxuriant lifestyle was detailed in Ryszard Kapuscinski’s book, The Emperor. Seeking to explain some of Ethiopia’s current financial woes, Kapuscinski utilizes Sellasie as a real-life allegory for the impact of early-onset stratification in developing countries; when valuable resources are only delegated to a select few, severe poverty for the rest of a population can arise, dominating the future of a country as a whole. The elitist suppression of others inherently negates the potential of systemic change, forcing the system to stay the way it is for the benefit of a wealthy few. I agree with Barder’s interpretation of Kapuscinski’s book, especially his distinction between democracy and freedom as it applies to Sellasie’s story.
Who was Steve Jones? What did he do at Uni-Lever? Was he successful? How significant were his results? Steve Jones was an engineer at the soap-dust production company Uni-Lever who sought to make a more ergonomic dispenser for his company’s product. The best result was ultimately produced through a series of randomized ratio tests, and acted as a source of huge profit for the firm. His results and story as a whole are extremely significant to the process of development, as they illustrate the impact of randomness on fiscal and social well-being.
What is the significance of Schumpeter’s idea of creative destructive? How does it relate to firms and industries? Schumpeter’s idea of creative destruction explains the overall benefit of competition and adaptation, especially as it applies to the realm of technology. In order to continually extract profits, industry leaders must constantly develop and release new products or face bankruptcy from being beat out by their competitors. Creative destruction, though seemingly detrimental to individual firms, is actually incredibly beneficial to society, as it allows technologies and industries to continually develop and improve the applications of existing products.
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 strongly recommends resisting engineering as a policy implication because it overwhelmingly fails to predict and model the non-linear dynamics of development and progress. Instead, he suggests adapting organically to emergent phenomena in order to build concrete systems of self-organizing complexity. He uses the term “isomorphic mimicry” to describe the inherent failings of engineering linear systems of development. Quite simply, it means adopting the appearance of effectiveness rather than actually implementing effective techniques for the furtherment of development. In this situation, however, “faking it until you make it” definitely does not work, as evidenced by Barder’s analysis of empty donor promises and their impacts on infrastructure.
What did Barder mean by “resist fatalism”? Who was Norman Borlaug and what is the green revolution? By advising his listeners to “resist fatalism,” Barder is discouraging individuals and development experts from accepting the assumed finality of results or processes. Rather than letting things fester the way they are or allowing external powers to direct the outcomes of localized development, Barder lauds the power of adaptation as a method of addressing and bettering detrimental circumstances. He uses Norman Borlaug, who sparked the Green Revolution by cross-breeding wheat to become heartier and more resistant, as an example of the power of human-induced evolution.