Understanding Development in the 21st Century

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Understanding Developmentin the 21st Century

• IARD 402
• September 2, 2005
• Robert W. Herdt

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Understanding Development in the 21st Century

• Global change
• Population growth
• Famine/Hunger
• Development and agriculture
• Development assistance?
• Agricultural technology?
• Foundations

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Profound recent global change

• Political/Economic
• Global climate change
• Infectious diseases, HIV/AIDS
• Population growth
• Information technology
• Intellectual property environment
• Biotechnology

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Global political/economic changes

• Failure of planned economies, end of cold war,
  Washington consensus
• Globalization - trade
• Asian growth defies the Washington consensus
• Market economies meet demand, but entail
  transactions costs, dont address inequity,
  externalities

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Global climate change

• Greenhouse gases rising
• Global temperature rising
• Increasing weather fluctuations?
• US farming reflects resilience to observed range
  of changes Averaging across geography? Cost of
  acquired resilience? Clean energy ?
• Grim prospects for tropics -- dryer, hotter

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HIV/AIDS, other infectious diseases

• Discovered 1981 Treatment 1987 No vaccine
• 39 million infected with HIV/AIDS
• 25 million in sub-Sahara Africa
• 8 of adults in SS Africa vs 0.6 in US
  orphans health care labor force
• In hardest-hit countries reduced life
  expectancy, but small impact on population growth
• HIV/AIDS ignored in India, all treated in Brazil
• TB, malaria, new infectious diseases

http//www.who.int/hiv/en/
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Information Technology

• Cell phones
• Internet
• Personal computers
• Digital divide

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Internet about a decade old
Number of internet hosts (million)
1990 Internet went commercial
1992 www invented
Internet Systems Consortium, Inc.
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Cell phone technology about a decade old
Global users
Internet Systems Consortium, Inc.
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Population Growth 17752000
Source UN Population Reference Bureau
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Long term world population (UN median estimate)
http//www.prb.org/template.cfm?SectionEducators
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Future global population scenarios
http//www.prb.org/template.cfm?SectionEducators
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Famine

• What is Famine?
• It is possible to identify measures that can
  bring about the elimination of famines and a
  radical reduction of chronic undernourishment.
  A.K. Sen.
• OK, But How?
• Lack of food entitlement, NOT lack of food leads
  to famine and chronic undernourishment (hunger)

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Food entitlements

• Ability by individuals to establish ownership
  and control over food
• What determines/affects entitlement? How?
• Production
• Technology
• Resources
• Income
• Prices
• Markets
• Policy
• Combined effects gt entitlement

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World food crisis?

• Global food-population race
• Developing countries food-population race
• Global food prices

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Food production growth and availability

• food population food
• increase growth
  available 1980-95
  rate calories 95
• World wide 11 1.3 2800
• Asia 44 1.4 2600
• South America 17 1.6 2800
• Europe 5 0 3200
• N. America 4 0.5 3300
• Africa - 4 2.4 2400

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World food pricesFood prices, US (constant) per
MT

• 1950-52 1995-97
• Wheat 427 159
• Rice 789 282
• Sorghum 328 111
• Maize 372 119

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Hunger Chronic Undernourishment

• Trends?
• Prevalence?
• Location?
• How to reverse?

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Projected numbers of malnourished children in
sub-Sahara Africa through 2050 under alternative
future food policies
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Percent of population hungry
Source FAO, State of Food Insecurity in the
World 1999
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1997 2020
IFPRI Projections
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World food crisis?

• Global food-population race
• Developing countries food-population race
• Global food prices
• Africa low and falling per-capita food. Why?
• General economic crisis
• With strong social and political elements
• Must be addressed in broader terms

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Key agricultural indicators,
2004
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Underlying-determinants of child malnutrition in
the developing world

• Based on data for 63 countries, 1970-1996, child
  malnutrition was reduced through
• National income growth reflected in
• National food availability 26
• Womens education and status 43
• Improvements in health (safe water) 19
• Favorable political context, reflected in
  democracy

Source Smith and Haddad, IFPRI Overcoming Child
Malnutrition in Developing Countries Past
Achievements and Future Choices
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Requirements for food security and higher
national income in Africa

• Peace, AIDS control, Democracy, Education
• Higher rural incomes
• Well-adapted, improved farm technology
• Well-functioning farm markets
• Non-discriminating agricultural policies
• Higher rural incomes agricultural growth --will
  reduce hunger

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Higher rural incomes requires increased ag
productivity

• Rural people comprise 70-90
• Their assets are primarily labor and land
• The inputs for crop production
• Non-farm enterprises requires capital
• Income is from a mix of sources, but farming
  predominates
• Non-ag enterprises require capital
• Historically small-scale farming led large-scale
  farming resulted

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Higher agricultural productivity requires
well-functioning markets

• Reliable information prices by quality (grades
  and standards)
• Widely disseminated information
• Enforceable contracts
• Roads local, regional, to ports
• Government facilitate information, offset market
  failures
• Fertilizer quality, seed testing, contracts,
  roads
• NOT seeds, fertilizers, credit

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Higher agricultural productivity requires better
farm technology

• Income low because yields are low (0.5 vs 2)
• output per hectare is low, crop land per person
  is low gt income is low
• Higher yields repeatedly demonstrated
• on experiment stations (5t/ha), on farms (2t/ha)
• not consistent need tailoring
• economically optimal levels not clear
• Monocrops, low fertilizer, poor varieties
• Limited use of improved technology

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Better farm technology requires

• Broader use of currently available, appropriate
  technology
• Seeds/varieties, cropping systems, compost,
  fertilizer, pest management
• Importation of well-adapted technology
• from similar biological, social, economic
  environments limited
• Invention of better technology through effective
  local research

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Agricultural research

• Raise productivity value of output/value of
  inputs
• Inputs seeds, plant nutrients, water, labor,
  land
• Raise efficiency of inputs (fertilizer, labor)
• Invent more productive inputs
• Crop varieties biotechnology and all that
• Raise effective price by reducing marketing costs
• Reduce input costs fertilizer, type, delivery

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Local agricultural research to develop new
technology

• Transfer from similar ecosystems
• by public sector -- CGIAR, national organizations
• by private sector -- NGOs, private companies,
  etc.
• Develop locally
• by public sector -- declining effort in nearly
  every country in SSA in Kenya all funds except
  salaries from donors
• by private sector -- market size, regulation, IPR
• Farmer-participatory technology-development
• No output without input!

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Requirements for food security and higher
national income in Africa

• NOT JUST AG RESEARCH!
• Peace, AIDS control, Democracy, Education
• Higher rural incomes
• Well-adapted, improved farm technology
• Well-functioning farm markets
• Non-discriminating agricultural policies
• Higher rural incomes agricultural growth --will
  reduce hunger

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Foundations Development

• Total development assistance 60 bil/yr
• US Govt development assistance 18 bil/yr
• Total 1000 largest US foundations 16 bil/yr
• For USA domestic activities 15.2 bil
• For international, development, peace 413
  mil/yr
• For food, nutrition, agriculture 125
  mil/yr
• For Life Sciences (in ST) 182 mil/yr
• Foundations working internationally in
  agriculture
• Rockefeller McKnight
• Kellogg Wellcome Trust
• Syngenta

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6. How (US) Foundation Work

• Grant making vs Operating
• US IRS requirements
• Preserving corpus
• Foundation giving
• International giving
• Coping with unlimited demand
• Competition Invitation Directed

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7. The Foundation Center

• Collect, organize, and communicate information on
  U.S. philanthropy.
• Conduct and facilitate research on trends in the
  field.
• Provide education and training on the grant
  seeking process.
• Ensure public access to information and services

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8. The Council on Foundations

• The Council on Foundations is a membership
  organization of more than 2,000 grantmaking
  foundations and giving programs worldwide. We
  provide leadership expertise, legal services and
  networking opportunitiesamong other
  servicesto our members and to the general
  public. 

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9. OECD Development Assistance Committee (DAC)

• The DAC publishes statistics and reports
  (www.oecd.org/dac/stats) on aid and other
  resource flows to developing countries and
  countries in transition and related matters,
  based principally on reporting by DAC Members.

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OECD Agriculture Aid 5-year moving av. 1999
prices
chart
chart
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Conclusions

• Rapid change but hunger remains
• Highest in Africa Largest number in S. Asia
• 2000-2050 critical
• Growing incomes needed
• Economic base is labor and land
• gt Farming must be the basis for growth
• Functioning markets, Dynamic technology
• Development aid

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Resources

• A.K. Sen, Development as Freedom, Anchor Books,
  2000
• FAO, State of Food Insecurity
• Population Reference Bureau (searchable data
  base) www.prb.org
• OECD Development Cooperation Directorate
  www.oecd.org

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Resources on Foundations

• Non-Profits, Charities, Foundations
  (Guide Star www.guidestar.org))
• Foundations
• The Foundation Center http//fdncenter.org/
• The Council on Foundations www.cof.org
• European Foundation Centre http//www.efc.be/
• Development Assistance
• Center for Global Development http//www.cgdev.or
  g
• Hudson Institute
• http//www.hudson.org/index.cfm?fuseactionpublica
  tion_detailsid3712