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Why so much aid for the poor has made so little difference

Is poverty cultural or technical? Such debates shouldn't impede progress.

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Is poverty a problem of policy or destiny? Experts tend to pull in one of two directions. Some focus on the social fundamentals for prosperity. Others, on the technical and financial requirements for sustainable growth.

 

In this view, policy is beside the point. Harvard political scientist Robert Putnam says that "social capital" – how closely people in a community are connected – supports the basis for trust essential to commerce. Economist Gregory Clark of the University of California argues that prosperous societies grow their economies through Industrial Revolution values such as patience, hard work, innovation, and education. Some cultures support such values, some don't, and they certainly can't be imported or master-planned.

 

Others say the developed world has the policy tools poor countries need and the obligation to show them how to use them. While specific proposals vary, development economists such as Paul Collier, Jeffrey Sachs, and Joseph Stiglitz argue that wealthy nations know how to create the conditions for accountable governance, open markets, capital formation, low taxes, reliable institutions, and regulatory frameworks with courts to enforce them.

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