BLOG POST

Lessons from Two Years of “The Future of Development”

December 20, 2022

Recommended

Event
The Future of Development: Gambling on Development
September 13, 2022
12:00—1:15 PM Eastern Time (US and Canada)

On December 1, 2020, we launched the Future of Development series with the ambition to feature some of the most interesting scholars in development, asking the “big” questions and sharing their ideas about the landscape of international development in the next decade. After two years, and nine sessions, it feels like a good time to reflect on the series, what we’ve learned and what we still hope to achieve with it.

Since starting the series, we’ve covered topics from agriculture to conflict, from financial markets to politics, from health to behavioral economics—the full breadth of what economics can teach us. And our list of speakers has been incredibly impressive: we opened with a Nobel laureate, Michael Kremer, and since then have featured established voices and rising stars in the profession. We are particularly proud of the fact that the series showcased the diversity of the economics profession. Of the 19 featured speakers, 11 were female; 10 were people of color; and five were based outside the US, though only one so far was based in a “Southern” institution—something we hope to improve in future editions.

Across it all, we’ve learnt a lot. There have been big ideas and spirited disagreements. We recap some of them below.

In “Digital Agriculture: Promising technology for smallholder farmers” Michael Kremer argued that digital advances have created substantial potential for improving the lives of smallholder farmers in low-income countries, pointing to a new way of doing agricultural interventions at scale with potentially massive welfare effects. The discussant, Margaret McMillan, argued that the key objective still needs to be an increase in productivity—including by moving people out of agriculture.

Getting interventions to scale was also central to the discussion between Pascaline Dupas and Jishnu Das on universal health. Pascaline said that persistent challenges in developing countries, including high rate of malnutrition, poor environmental quality, and difficulty reaching those left behind, call for an approach that goes beyond low-hanging fruit in healthcare and promotes investments outside the health sector. Jishnu countered that, even within the health sector, economists should return to thinking about big “G” government public health, providing public goods in the pursuit of broad, sustained, and deep progress in health outcomes in poor countries.

Productive investment was also the focus of the discussion between Atif Mian and Jing Cai on financial markets, though in this case the emphasis was on private investment—Atif arguing that a productive relationship with global capital requires avoiding “junk capital” with minimal productivity impact in favor of the tradable sector.

One place that got almost all of this right for a long time was China. Yuen Yuen Ang and Shang-Jin Wei provided two perspectives of this, in our session on lessons from China. Yuen argued that development practitioners must look at both the successes and the failures of Chinese development before they try to replicate Chinese success. Shang-Jin also argued against the idea of a magical Chinese model, and in favor of a pragmatic approach that identified good policies, implemented them, and scaled up those that worked. Both focused on the role of political and bureaucratic capacity in pursuit of growth. This is something Leonard Wantchekon made central to his discussion on politics, representation, and development with Sarah Khan. Leonard identified three main political distortions that generate welfare losses—patronage, weak contract enforcement, and state capture—and three sets of policies to address them: state reform to make government more transparent and less corrupt, campaign finance reform to limit state capture, and technology to improve state effectiveness and service delivery. Sarah Khan took a different angle by examining the gender dynamics of political participation in developing countries, arguing for a normative (“equal representation is intrinsically important”) rights-based rationale to advancing women’s representation, cautioning against policies that are “low-cost window dressing,” such as autocratic regimes’ introducing gender quotas in government.

Sarah’s concern with gender took center stage in our next session, in which Ashwini Deshpande and Alice Evans discussed working women in India where female labor force participation (FLFP) remains persistently low compared to other parts of the world. Ashwini argued that policymakers should not wait for norms to change but instead need to increase FLFP with policies that address constraints and improve representation, which might, in turn, change norms. Alice focused on the “patrilineal trap” which prevents women from earning money away from the home because the family wants to protect their “honor.” But, she argued, the trap is not insurmountable, and sufficient economic returns can tip the honor-income trade-off, citing Bangladesh as an example.

Our next session took a completely different tack but linked back to this topic in its conclusion. We looked at how a change in the way we do economics and research—specifically, the rise of behavioral economics—can help us better design and implement policies to improve welfare. Karla Hoff, one of the pioneers of behavioral development economics, argued powerfully for the need to incorporate culture into behavioral economics. She argued that that we see the world through cultural lenses—not objectively—and understanding these shared mental models can be used in policy to promote economic development. From the perspective of an applied researcher, Elizabeth Linos added that behavioral interventions and approaches to public policy that incorporate behavioral science can affect social norms, practices, and behaviors in ways that might shift culture over time.

Our most recent two sessions focused squarely on our original mission: to ask the big questions, with the greatest implications for human welfare. We heard from Chris Blattman and Stefan Dercon about their new books. In Why We Fight, Chris asked why, when war is costly and enemies prefer to loathe in peace, does conflict arise at all? His answer—that when leaders can pay or ignore the costs, they can sustain conflict—suggested ways for outsiders to reduce the risk of conflict: by contributing to the spread of power and working on the margins to broaden material and mobilizational power in society. Kate Cronin-Furman, the discussant, raised the concern that power structures impact everything—how policy is designed, implemented, and evaluated—so reinforcing the status quo of power distributions even in “neutral” interventions is a political act. Tread with caution, she counseled, and center the affected population rather than the intervener.

Finally, in our last session of this year, Stefan Dercon laid out the main thesis of his new book, Gambling on Development. In explaining why some countries achieve growth and development while others fail, he argues that elites strike a “development bargain” where self-interest is balanced with a shared commitment to growth and development, and that policies, institutions, and aid are more effective in the countries with a development bargain. Fundamentally, development happens when the elites want it to happen, and work towards it. This raises several questions: Naomi Hossain suggested social contracts might have multiple alternative aims, for example the avoidance of famine and disaster, while Masood Ahmed suggested that outsiders can still play a role in promoting development by shifting incentives—using policy and diplomacy as well as aid—to influence the behavior of elites.

Each of these sessions was well attended, with superb questions from the audience, reflecting the on-going interest and importance of ideas in the pursuit of development. We’ll be back in the new year, when Arvind Subramanian will talk to us about convergence between poor and rich countries, with further sessions to follow. There remains a great deal left for us to discover and discuss, and we hope you will join us.

Disclaimer

CGD blog posts reflect the views of the authors, drawing on prior research and experience in their areas of expertise. CGD is a nonpartisan, independent organization and does not take institutional positions.