Why are some countries rich and others poor?

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• Why are some countries rich and others poor?
• An ensuing 21st-century paradox

Europe Supported by Africa and America William
Blake (1796)
Jelte Harnmeijer Schishuney / fishing place with
a pole / Waldron Island 10 July MMX
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For unto every one that hath shall be given, and
he shall have abundance but from him that hath
not shall be taken away even that which he
hath. - Matthew XXV29, King James Edition
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Outline

• 1. What are Poverty and Inequality?
• 2. What patterns exist in the distribution of
  income?
• 3. Why are some countries rich and others poor?
• 4. Neocolonial explanations for persistent
  21stcentury poverty
• 5. The link with Sustainability

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1. What are Poverty and Inequality?
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Mohotlong, Lesotho
Guandong, Chinese-occupied Tibet
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Maputo, Mozambique
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New York, USA
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Kaokoveld, Namibia
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U.S. of A.
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Nepal
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Money Happiness
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What do people think makes them happy?
After Cantril (1965)
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What do people think makes them happy?
What is well-being?
After British Social Science Research Council
(1975) In Douthwaite (1999)
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Income happiness
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Income happiness
Reported life satisfaction increases with income
to US10,000 15,000, then levels off at higher
levels
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The case for greaterequality
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Income inequality correlates with ...
social capital
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(4) Inequality
Income inequality correlates with ...
infant mortality
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(4) Inequality
Income inequality correlates with ...
mental illness
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(4) Inequality
Income inequality correlates with ...
drug abuse
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(4) Inequality
Income inequality correlates with ...
high-school drop out rates
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(4) Inequality
Income inequality correlates with ...
incarceration rates
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(4) Inequality
Income inequality correlates with ...
obesity
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(4) Inequality
Income inequality correlates with ...
trust in fellow humans
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(4) Inequality
Income inequality correlates with ...
homicide rates
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(4) Inequality
Income inequality correlates with ...
teenage pregnancy rates
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(4) Inequality
Income inequality correlates with ...
child well-being
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(4) Inequality
Income inequality correlates with ...
national altruism
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(4) Inequality
Income inequality correlates with ...
recycling
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2. What patterns exist in the distribution of
income?
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What patterns exist in the distribution of income?
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(4) Inequality
What patterns exist in the distribution of income?
Compiled from 2003 World Bank country dataset
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What patterns exist in the distribution of income?
Per-capita income for white and black Brazilians.
Source IBGE Census 2000.
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What patterns exist in the distribution of income?
Where are the people?
100
10000
1000
100000
Income (US, PPP)
(AFRAfrica EAPEast Asia ECEEast- and Central
Europe LACLatin America OECDOrganisation for
Economic Co-operation and Development SASSouth
Asia)
Source Dikhanov, Y. and Ward, M. (2003)
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What patterns exist in the distribution of income?
Where is the dough?
Income (US, PPP)
100
10000
1000
100000
(AFRAfrica EAPEast Asia ECEEast- and Central
Europe LACLatin America OECDOrganisation for
Economic Co-operation and Development SASSouth
Asia)
Source Dikhanov, Y. and Ward, M. (2003)
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3. Why are some countries rich and others poor?
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Why are some countries rich and others poor?
Summary of interviews conducted between February
2002 and June 2006.
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Categories of responses
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Categories of responses
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Categories of responses
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• Evolutionary explanations
• because some people are clever and others are
  stupid.
• - Anonymous white South African of Boer ancestry,
  Hazyview, South Africa, July 2004.
• The idea that some populations are more
  energetic than others perhaps deserves some
  consideration.
• - J.P. Cole (1979), The Development Gap, page 111.

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Categories of responses
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Categories of responses
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• (ii) Cultural/societal explanations
• ... the explanations offered for the contrasting
  records in growth have most often focused on
  institutions and highlighted the variation across
  societies in conditions relevant to growth such
  as the security of property rights, prevalence of
  corruption, structures of the financial sector,
  investment in public infrastructure and social
  capital, and the inclination to work hard or be
  entrepreneurial.
• - Sokoloff Engerman (2000), page 218.

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GDP/capita relative to US in selected New World
economies, 1700-1997
Source Sokoloff and Engermann (2000)
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Categories of responses
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• (iii) Environmental explanations
• These areas were settled because the climate was
  similar to that of Europe.
• - Prof. Wolfram Latsch, personal communication,
  April 2004.
• I think that tropical diseases are largely to
  blame.
• - Prof. Roger Buick, North Pole, Australia,
  August 2004.

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Koppen classification climatic zones
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• (iv) Historical explanations
• European countries have been around for a long
  time. We are young. We just simply need time to
  catch up.
• - Nxobo Masika, Johannesburg, South Africa, March
  2004.

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Dates of recent independence of developing
countries.
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Early dates of independence of South American
countries
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• (v) Inept-leadership explanations
• African leaders themselves have also failed the
  resource-rich continent. They continue to
  unscrupulously harp on historical injustices to
  cover up for their political and economic mess
  that are sic a sad manifestation of their
  suppression of democratic governance. Corrupt and
  inefficient management of economies, greed, power
  hunger, disrespect for human rights, cronyism,
  among other vices, have contributed to the
  underdevelopment of Africa today.
• Charles Mangongera, Should We Continue to Blame
  Colonialism?, Financial Gazette (Harare,
  Zimbabwe), September 19, 2002.
• A district our size should have a much better
  soccer field, but the money was pocketed. There
  is corruption at all levels. Its a top-down
  problem.
• - Unemployed 27-yr-old Sidhinhyo, Morongulos,
  Mozambique, April 2004.

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Evolution of Corruption by Regions of the World,
1984-1999
Source Lederman, D, Loayza, N. and Soares, R.R.
(2001)
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Who has the most to gain from corruption? (or
the most to lose from ending it?)
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• (vi) Psychological explanations
• There exists among us a strong feeling of
  inferiority which comes from our awareness of
  past white/European oppression.
• - Anonymous fisherman, northern Mozambique, April
  2004.

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• (vii) Neocolonial explanations
• We were told, and accepted, that our poverty was
  caused by our poverty in the now famous theory of
  the vicious circle of poverty and we went round
  in circles seeking ways and means of breaking
  that circle. Had we asked the right questions
  we would not have exposed our economies to the
  ruthless plunder brought about by foreign
  investments which the exponents of the vicious
  circle theory urged us to do. For, it is clear,
  foreign investment is the cause, and not a
  solution, to our economic backwardness.
• - Former Tanzanian minister A.M. Babu, In Walter
  Rodney (1965), How Europe underdeveloped Africa,
  page 312.

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Economies are like fires ...
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5. The link with Sustainability
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Neocolonial explanations for persistent
21st-century poverty
Earths ecologically productive surface
21.42?109 hectares
Per-capita surface required to support American
lifestyle 9.57 hectares
Global population on July 10th, 2010 6 795
329 623
Acreage required to support worldwide American
standards of living 3 Earths
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Fact
Present American standards of living for the
entire global populace are a physical
impossibility.
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(a)
(b)
Cartograms illustrating (a) country-level wood
and paper imports (by volume) for the year 2000
(b) country-level net forest loss between 1990
and 2000.
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Flows of raw material and fuel
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the case for greaterglobal equalityalmost
everyone stands to gain
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http//www.realfuture.org
the tide is on Our side