Digital Archive....

Can Kenya replicate Indonesia's turnaround? Africa Can... - End Poverty Recently, a friend from Indonesia visited me in Nairobi. He is one of the world's leading experts on social development and a long-term Jakarta resident. One of his observations stuck in my mind: "Kenya is just like Indonesia ten years ago", he said.  Comparing Kenya with Indonesia is counterintuitive—except perhaps when it comes to traffic jams—because of the many differences between the two countries. Indonesia is the world largest island state with more than 17.000 islands and a demographic heavyweight with 240 million people (six times more than Kenya). It is also 85 percent Muslim, while Kenya is about 85 percent Christian. Indonesia has massive natural resources – coal and gas (and some oil) – that it exports to other Asian countries, especially China, while Kenya's economy is fuelled by a strong service sector. There are many more reasons to challe...

Taking credit Aid Thoughts When you have a moment, I'd really like to see your source for that While the Millennium Village Project's  shaky claim  of reducing child mortality resulted in an impressive backlash, these sorts of assertions are not uncommon. Very frequently, donors, NGOs and philanthropists make unsubstantiated claims to impact which go unchallenged, either because they go unnoticed by those who know better or because we're all just too busy to raise the alarm every time someone makes a bogus claim (or, perhaps, we're being funded by said entity). For example, take this tweet by Oxfam international: Together w/our partners we reduced the maternal mortality rate in Upper East #Ghana by 7% in 2010 bit.ly/LPXbKI — Oxfam International (@Oxfam) May 30, 2012 That's quite a claim. What does Oxfam have to back up this claim? The tweet links to an article in the Ghana Business News: Speaking at a ceremony in Bo...

John Rawls's Critique of Capitalism Economist's View Daniel Little: Rawls on a property-owning democracy, by Daniel Little : John Rawls's critique of capitalism was deeper than has been commonly recognized -- this is a central thrust of quite a bit of important recent work on Rawls's theory of justice. Much of this recent discussion focuses on Rawls's idea of a "property-owning democracy" as an alternative to both laissez-faire and welfare-state capitalism. This more disruptive reading of Rawls is especially important today, forty years later, given the great degree to which wealth stratification has increased and the political influence of wealth has mushroomed. (I've addressed this set of issues in prior posts; link , link .) Martin O'Neill and Thad Williamson's recent volume, Property-Owning Democracy: Rawls and Beyond , provides an excellent and detailed discussion of the many dimensions of this...

Microfinance as an allegory for aid Owen abroad Microfinance has been  touted  as a 'bottom up solution' to poverty. The Nobel Peace Prize 2006  was awarded  jointly to Muhammad Yunus and Grameen Bank " for their efforts to create economic and social development from below ."  Give people access to credit,  the   story   went , and they will be able to invest in businesses of their own.  The Acumen Fund  promises  " Dignity not Dependence. Choice not charity ." But in the latest episode of Development Drums , David Roodman explains that rigorous evaluations of micro-credit suggest that, on average, it has no effect on poverty. (The results are more positive for other financial services.) Why then, David asks, does he witnesss women queueing up enthusiastically for their loans?  Should he explain to them that, according to the results of complex evaluations, microfinance is doing them no good? Are they mistaken about what i...

The End Of The Euro: A Survivor's Guide The Baseline Scenario By Peter Boone and Simon Johnson In every economic crisis there comes a moment of clarity.  In Europe soon, millions of people will wake up to realize that the euro-as-we-know-it is gone.  Economic chaos awaits them. To understand why, first strip away your illusions.  Europe's crisis to date is a series of supposedly "decisive" turning points that each turned out to be just another step down a steep hill.  Greece's upcoming election on June 17 is another such moment.  While the so-called "pro-bailout" forces may prevail in terms of parliamentary seats, some form of new currency will soon flood the streets of Athens.  It is already nearly impossible to save Greek membership in the euro area: depositors flee banks, taxpayers delay tax payments, and companies postpone paying their suppliers – either because they can't pay or because they expect soon to be able...

Jamie Dimon And The Fall Of Nations The Baseline Scenario By Simon Johnson " Why Nations Fail: The Origins of Power, Prosperity, and Poverty ," by Daron Acemoglu and James Robinson, is a brilliant and sometimes breathtaking survey of country-level governance over history and around the world. Professors Acemoglu and Robinson discern a simple pattern – when elites are held in check, typically by effective legal mechanisms, everyone else in society does much better and sustained economic growth becomes possible. But powerful people – kings, barons, industrialists, bankers – work long and hard to relax the constraints on their actions. And when they succeed, the effects are not just redistribution toward themselves but also an undermining of economic growth and often a tearing at the fabric of society. (I've worked with the authors on related issues, but I was not involved in writing the book.) The historical evidence is overwhelming. Many s...

First Deflation, Then Inflation. But the Timing…? The Big Picture First Deflation, Then Inflation. But the Timing…? John Mauldin June 2, 2012     US Unemployment Turns Back South A Synchronized Global Slowdown Why Would You Buy a Bond with Negative Interest? First Deflation, Then Inflation New York, Madrid, Tuscany, and Singapore A New Adventure And Bad Dad     One of the more frequent questions I am asked in meetings or after a speech is whether I think we will have inflation or deflation. My ready answer is, "Yes." Then I stop, which I must admit is rather fun, as the person who asked tries to digest the answer. And while my answer is flippant, it's also the truth, as I do expect both outcomes. So the follow-up question (after the obligatory chuckle from the rest of the group) is for a few more specifics. And the answer is that I expect we will first see deflation and then inflation, but the key is the timing. To...