INTERNATIONAL ENCYCLOPEDIA OF PUBLIC POLICY

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INTERNATIONAL ENCYCLOPEDIA
OF PUBLIC POLICY
VOLUME 1─GLOBAL GOVERNANCE AND DEVELOPMENT
Contents of Volume One
AIDS and HIV Phillip Anthony O’Hara 1
Balance of Payments Matias Vernengo 17
Brain Drain James J.F. Forest 28
Capability Approach to Development Policy Ingrid Robeyns 38
Child Labour G.K. Lieten 46
Debt Crises and Development Matias Vernengo 57
Development Governance G.K. Lieten 69
European Union Macroeconomic Policies Angelo Reati 81
Foreign Aid B. Mak Arvin 96
Foreign Direct Investment Aristidis Bitzenis 106
Free Trade Area of the Americas John Dietrich 123
Free Trade and Protection James M. Lutz 135
Free Trade and Protection: Comparative Nevin Cavusoglu & Bruce Elmslie 145
Geneva Conventions John W. Dietrich 158
Genocide and Gross Violations of Human Rights Levon Chorbajian 167
Global Governance Mark Beeson 180
Global Justice and Solidarity Movement Peter Waterman 191
Global Political Economy Mark Beeson 199
Global Public Goods Kunibert Raffer 208
Global Value Chains Jérôme Ballet and Aurélie Carimentrand 219
Globalization Arestidis Bitzenis 233
Hegemony Thomas Ehrlich Reifer 245
Human Development Ananya MukherjeeReed 256
Human Slavery Edward O’Boyle 264
International Labour Organization Joseph Mensah 271
International Monetary Fund Joseph Mensah 283
Lender of Last Resort: International Matias Vernengo 297
Microfinance Agus Eko Nugroho 304
Middle East Political-Economic Integration Nevin Cavusoglu 316
Military-Industrial Complex Tom Reifer 330
Millennium Development Goals Thomas Marmefelt 351
Monetary Unions Malcolm Sawyer 363
Non-Government Organizations Celina Su 373
North Atlantic Treaty Organisation Glen Segell 384
OPEC Kunibert Raffer 391
Political and Economic Integration in East Asia Mark Beeson 402
v
Refugees and Asyllum Seekers Moses Adama Osiro 415
Sovereign Debt Kunibert Raffer 431
Terms of Trade and Development Kunibert Raffer 443
Terrorism Brenda J. Lutz and James M. Lutz 454
Tobin-Type Taxes and Capital Controls John Lodewijks 467
Transitional Economies John Marangos 475
Tourism Jeffrey Pope 490
Uneven Development & Regional Economic Performance Konstantinos Melachroines 501
United Nations John W. Dietrich 514
United States Hegemony Mark Beeson 524
War, Collective Violence and Conflict: Civil and Regional Amitava Krishna Dutt 534
War, Collective Violence and Conflict: Nuclear and Biological Glen Segell 546
World Bank Joseph Mensah 555
World Government John W. Dietrich 571
World Trade Organization Amitava Krishna Dutt 582
EDITOR: Phillip illip illip Ant hony ony O’Hara Hara Hara Hara
GPERU, PERTH
AUSTRALIA
2009
[PAGE PROOFS: TUESDAY 10 NOVEMBER 2009, 11.55AM]

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INTERNATIONAL ENCYCLOPEDIA OF PUBLIC POLICY

  1. 1. INTERNATIONAL ENCYCLOPEDIA OF PUBLIC POLICY VOLUME 1─GLOBAL GOVERNANCE AND DEVELOPMENT EDITOR: Phillip Anthony O’Hara GPERU, PERTH AUSTRALIA 2009[PAGE PROOFS: TUESDAY 10 NOVEMBER 2009, 11.55AM]
  2. 2. First published 2009 by GPERU International Encyclopedia of Public Policy: Volume 1: Global Governance and Development GPERU is an imprint of the Global Political Economy Research Unit © 2009 Editorial matter and selection, Phillip Anthony O’Hara; Individual chapters, the contributors Typeset in Times New Roman, Algerian, Comic Sans MS by GPERU, Perth, Australia. All rights reserved. No part of this book may be commercially reprinted or reproduced or used in any other form or by electronic, mechanical or other means, including photocopying and recording, or any other information storage, without permission by the publisher. Non-commercial use of materials by individuals, libraries, universities and governments requires proper detailed acknowledgement and statement of access details of the encyclopedia. British Library Cataloguing in Publication Data A Catalogue record for this book is available from the British Library Library of Congress Catologing-in-Publication DataA Catalogue record for this book is available from the Library of Congress INT ISBN 0-515-34523-X (set) [Pending] PBK ISBN 0-515-46411-X (set) [Pending] HBK ISNB 0-515-78322-X (set) [Pending] ii
  3. 3. INTERNATIONAL ENCYCLOPEDIA OF PUBLIC POLICY VOLUME 1: GLOBAL GOVERNANCE AND DEVELOPMENT EDITORIAL TEAM Editor: Phillip O’Hara Global Political Economy Research Unit, Curtin University, Perth, Australia Associate editors: Kunibert Raffer Institut für Volkswirtschaftslehre, der Universität Wien, Austria. Glen Segell Director of the Institute of Security Policy, London, UK. Editorial Board: Mark Beeson Department of Politics, University of York, UK. John W. Dietrich Department of Politics, Bryant College, Rhode Island, US Amitava Krishna Dutt Dept of Economics & Policy Studies, University of Notre Dame, US Ananya Mukherjee Reed Department of Political Science, York University, Canada Celina Su Brooklyn College, City University of New York, USA Matias Vernengo Department of Economics, University of Utah, Salt Lake City Communications coordinator: Andrew Brennan Global Political Economy Research Unit, Perth, Australia How to Reference (Example):John W. Dietrich, “World Government”, in P.A. O’Hara (Ed.), InternationalEncyclopedia of Public Policy: Volume 1―Global Governance and Development.GPERU: Perth, pp. 571-581. http://pohara.homestead.com/Encyclopedia/Volume-1.pdfCorrespondence with Editor: iepp1@runbox.com iii
  4. 4. Contents of Volume OneAIDS and HIV Phillip Anthony O’Hara 1Balance of Payments Matias Vernengo 17Brain Drain James J.F. Forest 28Capability Approach to Development Policy Ingrid Robeyns 38Child Labour G.K. Lieten 46Debt Crises and Development Matias Vernengo 57Development Governance G.K. Lieten 69European Union Macroeconomic Policies Angelo Reati 81Foreign Aid B. Mak Arvin 96Foreign Direct Investment Aristidis Bitzenis 106Free Trade Area of the Americas John Dietrich 123Free Trade and Protection James M. Lutz 135Free Trade and Protection: Comparative Nevin Cavusoglu & Bruce Elmslie 145Geneva Conventions John W. Dietrich 158Genocide and Gross Violations of Human Rights Levon Chorbajian 167Global Governance Mark Beeson 180Global Justice and Solidarity Movement Peter Waterman 191Global Political Economy Mark Beeson 199Global Public Goods Kunibert Raffer 208Global Value Chains Jérôme Ballet and Aurélie Carimentrand 219Globalization Arestidis Bitzenis 233Hegemony Thomas Ehrlich Reifer 245Human Development Ananya MukherjeeReed 256Human Slavery Edward O’Boyle 264International Labour Organization Joseph Mensah 271International Monetary Fund Joseph Mensah 283Lender of Last Resort: International Matias Vernengo 297Microfinance Agus Eko Nugroho 304Middle East Political-Economic Integration Nevin Cavusoglu 316Military-Industrial Complex Tom Reifer 330Millennium Development Goals Thomas Marmefelt 351Monetary Unions Malcolm Sawyer 363Non-Government Organizations Celina Su 373North Atlantic Treaty Organisation Glen Segell 384OPEC Kunibert Raffer 391Political and Economic Integration in East Asia Mark Beeson 402 iv
  5. 5. Refugees and Asyllum Seekers Moses Adama Osiro 415Sovereign Debt Kunibert Raffer 431Terms of Trade and Development Kunibert Raffer 443Terrorism Brenda J. Lutz and James M. Lutz 454Tobin-Type Taxes and Capital Controls John Lodewijks 467Transitional Economies John Marangos 475Tourism Jeffrey Pope 490Uneven Development & Regional Economic Performance Konstantinos Melachroines 501United Nations John W. Dietrich 514United States Hegemony Mark Beeson 524War, Collective Violence and Conflict: Civil and Regional Amitava Krishna Dutt 534War, Collective Violence and Conflict: Nuclear and Biological Glen Segell 546World Bank Joseph Mensah 555World Government John W. Dietrich 571World Trade Organization Amitava Krishna Dutt 582 v
  6. 6. AIDS and HIV mucosal cancer called Kaposi’s sarcoma which tended to inflict the elderly, along with Phillip Anthony O’Hara opportunistic infections, began causing serious problems and even death amongIntroduction young gays during 1980 and 1981. OtherThe AIDS and HIV so-called epidemic is diseases that appeared were cryptococcalcurrently one of the most critical medical, meningitis and serious cases of herpes. Oversocial and governance issues facing the the next few years hundreds of young gayworld. An understanding of the topic men came down with a combination ofencompasses such a wide array of opportunistic infections, severe thrush and/ordisciplinary areas, including biology and herpes, pneumonia, Kaposi’s sarcoma,chemistry; medicine and health; global cerebral lesions and toxoplasia infection. Bypoverty and affluence; power and authority; late 1981 the CDC reported 108 such patientscommunity and social networks; plus lifestyle and within a year half were dead. By Apriland drug issues. It is a controversial topic 1982, 248 cases were isolated, apparently atwith many unresolved issues, conflicting least 40 of them having had homosexualtheories, and vested interests involved. relations with one particular person, GaetanUnderstanding the issues requires a holistic Dugas, a French-Canadian Air Canada flightperspective that scrutinises a wide spectrum attendant. (He was nicknamed “Patient Zero”,of literature. and died in March 1984.) By the end of 1984, Issues that would later be seen as 8000 people had been diagnosed with thisinvolving AIDS were first brought to the syndrome in the US.attention of doctors in Los Angeles, New Soon it became apparent that the US wasYork and San Francisco in the late 1970s and not the only nation with this affliction. A fewearly 1980s. The thing that perplexed medics cases were isolated in Europe and Haiti;was the existence of a combination of vague while equatorial Africa soon becameand specific diseases that normally were not seriously involved. While AIDS patients inserious suddenly manifesting in problematic the West were predominantly homosexual, inways. A Los Angeles general practitioner Africa they were almost exclusivelynoticed an increase in mononucleosis-type heterosexual (especially women). Many ofsymptoms such as high fever, swollen lymph the African cases seemed to have an earlierglands, chronic diarrhoea, thrush and weight genesis to the US ones, going back to theloss (opportunistic infections) among his mid-1970s, and having links with Europe.young gay patients that never completely The French put forward the “Africandisappeared. Some were hospitalised with hypothesis”: that the first (European) wave ofrespiratory distress. Other LA medics had the syndrome emanated from Africa,similarly young gay patients coming down followed by a wave from the US. Somewith Pneumocystis carinii pneumonia (PCP) evidence then arose alluding to a Congoleseand candidiasis. The five cases of PCP were patient going back to 1962 (Grmek 1990:30).noted by the US federal government Centre The interconnected nature of thefor Disease Control (CDC) and documented afflictions quickly became apparent, and byin their weekly bulletin. June of 1982 the CDC had began to call it Other strange and unusually toxic AIDS, the Acquired Immunodeficiencyinfections were noticed in New York and San Syndrome. Various other, equivalent,Francisco. A normally benign skin and acronyms were used in non-English speaking 1
  7. 7. nations. Early on AIDS was linked to lifestyle 2.55m (2005) to 3.75m (2020), while adultfactors, such as drug use, sexual promiscuity AIDS-related deaths rise from 1.9m (2005) toand inadequate nutrition. Soon attention 2.6m (2020). The incidence of HIV and AIDSbegan to be focussed on a viral cause, thanks in Africa thus far outweigh the experienceto the combined work of the French Pasteur elsewhere on Earth, both in terms of theInstitute, the US National Institute of Health, absolute seriousness of the problem and theand others. In 1984 it became apparent to proportionate rates of mortality vis-à-vismany that a certain retrovirus with a those living with the virus.propensity to destroy helper lymphocytes wasthe “ultimate cause” of the syndrome. During Table 1: Regional HIV & AIDS Incidence 20051984-86 the mechanisms and processes of Living New HIV AIDS with HIV Adult Deathshow the human immunodeficiency virus HIV Cases Rateworked were better understood, at least in Sub-Saharan 25.8m 3.2m 7.2% 2.4mtheir basic form. Since then virtually all the Africa Caribbean 300,000 30,000 1.6% 24,000attention has been given to how to fight this Eastern Europe 1.6m 270,000 0.9% 62,000virus through drugs, vaccines and & Central Asiapreventative measures such as condoms, South & SE Asia 7.4m 990,000 0.7% 480,000better blood preparations, reducing needle North America 1.2m 43,000 0.7% 18,000 Oceania 74,000 8,200 0.5% 3,600exchanges and moderating promiscuous Latin America 1.8m 200,000 0.6% 66,000tendencies. UNAIDS, the World Health Western & 720,000 22,000 0.3% 12,000Organisation, national centres for AIDS Central Europepolicy, non-government organisations, and a North Africa & 520,000 67,000 0.2% 58,000 Middle Easthost of community networks have all played East Asia 870,000 140,000 0.1% 41,000their role in AIDS awareness, prevention and TOTAL 40.3m 4.9m 1.1% 3.1mcontrol. Source: Adapted from UNAIDS/WHO (2005:3)Global Distribution of AIDS/HIV Regional differences in HIV and AIDS inA major problem obtaining consistent SSA are considerable. For instance, HIV-statistics on HIV and AIDS are the changes prevalence among pregnant women attendingthat occurred in definition and testing antenatal clinics in SSA in the mid-2000s wasmethods over the decades. Comparable multi- 38 percent in Botswana, 30 percent in Southregional cross-section data exist only for Africa, 22 percent in Zimbabwe, 19 percentrecent years. See Table 1, below. Worldwide in Mozambique, 11 percent in Ethiopia, plusthere were over forty million HIV-positive 8, 7 and 3.5 percent, respectively, in Cotepersons in the world in 2005. Of these, over d’lvoire, Kenya and Ghana. Major differences60 percent of the cases were in sub-Saharan also exist within particular nations. ForAfrica (SSA), where, on average, 7.2 percent instance, HIV-prevalence in parts ofof the whole adult population had antibodies Mozambique varies greatly, from 34 percentfor the virus. Of the 4.9m new cases of HIV in C.S. Ponta-Gea to 26 percent in C.S.E.in 2005, 65 percent were from SSA. However Mondlane to 10 percent in H.R. Montepuezthere is a far greater percent of people dying and C.S. 25 Setembro (2004).from AIDS in SSA: of the 3.1m deaths from The seriousness of HIV outside SSAAIDS worldwide, over three-quarters were varies greatly, from an adult prevalence ratefrom SSA. Projected new adult infections per of 1.6% in the Caribbean to 0.9% in Easternyear in SSA are expected to increase from Europe and Central Asia, 0.7% in North 2
  8. 8. America and South & South East Asia to People are living much longer from AIDS0.6% in Latin America, 0.5% in Oceania, to diseases in North America, Europe andrelatively low rates of 0.3% in Western and Oceania, often 15-20 years; while quite a fewCentral Europe, 0.2% in North Africa and the who are HIV-positive never exhibit any majorMiddle East and the lowest rate of 0.1% in symptoms of AIDS.East Asia. While 58% of adults with HIV arewomen in SSA, the percent is about equal Natural History of HIVbetween men and women in North Africa, the Figure 1 illustrates the natural history of SIV-Middle East, the Caribbean and Oceania. HIV as it originated in western Africa andEverywhere else in the world—Asia, the spread throughout the world.Americas, and Europe—HIV is heavilyconcentrated among men (about 75%) (2005). Figure 1: Natural History of SIV-HIV among Human BeingsIn regions where female HIV casespredominate, such as SSA, babies and A B C Dchildren constitute a relatively large Numberpercentage of the infections, being equal to of New Period of Period of Period of Epidemic Human Multiple Rapid or Pandemicthe other high-HIV age category, 25-40 years. SIV-HIV Infections Transfer of SIV Social Change(UNAIDS 2005.) to Humans (& Genetic and/or Dislocation Period of The best time series data are from the US, Evolution To HIV) Increasing Humanas shown in Table 2, below. Resistance To HIVTable 2: USA: Annual AIDS Cases 1985-2003 1985 1990 1995 2000 2003NewAIDS 12,000 50,000 70,000 42,000 43,000casesAIDS 7,000 33,000 52,000 18,000 18,000Deaths USA 1960s 1985 1995 Africa 1910 1960s 1985 2025??PersonsLiving 85,000 218,000 340,000 410,000 It shows Phase A, the origins, starting aroundwith 15,000 1910-1920 with the transfer of two types ofAIDS (567%) (256%) (156%) (121%)(%↑) Simian Immunodeficiency Virus, SIVCPZ (from chimpanzees [troglodytes]) and SIVSMSource: Adapted from UNAIDS/WHO (2005:67) (sooty mangabeys) to humans, in the form ofThe number of people living with AIDS in HIV-1 and HIV-2, respectively. Transmissionthe US has been increasing over the past occurred by sharing blood or mucosal tissuetwenty years at a fairly consistent level, while through dietetic, sexual and/or domesticthe rate of increase has diminished since the relationships with simians. HIV-1 and HIV-2early 1990s. The epidemic of new AIDS parasites slowly became part of the pool ofcases reached a peak of 80,000 in 1992 and micro-organisms infecting human beings, and1993 (not shown), with the peak of 52,000 genetically evolving in the process throughAIDS deaths per year occurring three years various sub-species of viruses. Phase B led tolater in 1995. Since then new AIDS cases and the initial spread of the viruses through theAIDS deaths have stabilised at around 42- population from very small pockets to the43,000 and 18,000, respectively, in 2003. wider society, as a result of rapid social change or dislocation. This includes, for 3
  9. 9. instance, the end of colonial rule and wars of transmission of primate lentiviruses toindependence in western Africa in the 1950s humans is supported by SIV-HIV similarities(vis-à-vis Portugal, France, Belgium); and the in viral genome structure, phylogenicsexual and gay liberation movements as well relationships, geographical linkages andas the explosion of recreational drug use and plausible routes of transmission. The mostinternational travel, in the US (and Europe) in likely subspecies involved is the commonthe 1960s and 1970s. chimp (Pan troglodytes) through SIVcpz(P.t.t.) Phase C was the emergence of the virus in since they were kept as pets and eaten inthe medical and social consciousness as it west-eastern Africa (Gao et al 1999). SIVs dogradually became a problem of epidemic not cause diseases in monkeys as they haveproportions, at least in certain sub- effective immunity to the viruses.populations or the population in general. Samples of blood contaminated by HIV-1From the 1980s it spread rapidly through have been collected as early as 1959. But thehomosexual populations in New York, Los origins of zoonotic transmission are muchAngeles and San Francisco; as well as earlier. Evidence points to a likely mean yearspreading through the general population in of the most common ancestor of the O-Sub-Saharan Africa; and more latterly in the subtype HIV virus (which may indicate theCaribbean, Eastern Europe and parts of Asia time of cross-species SIV infection) of around(during the 1990s). Phase D, declining 1920-1930 (with a far lower probability of itincidence of HIV and reduced deaths from occurring as early as 1850 or as late as 1950).AIDS, both emerged in the mid-1990s in the It has been estimated that “group 0 infectionsUS. As human beings began to increase their have doubled approximately every 9 yearsimmunity to HIV-AIDS though natural or since 1920” (Lemey et al 2004:1064).drug-enhanced measures, the US epidemic Of the HIV-1 genus M there are 11subsided, while SSA as a whole is yet to subtypes labelled A-K, the first five (A-E)peak, and may not do so for another ten to having been studied closely. Korber et altwenty years. (2000) present evidence that “the last There are two major strains of HIV, HIV-1 common ancestor of the HIV-1 [M] groupand HIV-2, both of which originated in sub- point to the first half of the twentiethSaharan Africa. There are three groups of century”, which could indicate the time ofHIV-1, including M (major), O (outlier) and cross-species infection by SIV, specificallyN (neither M nor O). Within the major M around 1930 (circa 1908-1950). A-J are foundgroup are numerous subtypes A-J, accounting mostly in sub-Saharan Africa; B originatedfor over 90 percent of all worldwide HIV mainly in the US, Europe, and Haiti; a mix ofinfection. Group O origins are isolates from A-C and D-G being common in central andwest-central Africa (Cameroon, Gabon and eastern Africa (Uganda, Kenya, Tanzania andEquatorial Guinea), while N, which is rare, the DR Congo); while M subtype E isemanates from Cameroon. HIV originates common in Thailand. Vasan et al (2006)from cross-species infections between studied the degree of virulence of subtypes A,monkeys and humans, specifically by simian C and D (plus recombinants of these) inimmunodeficiency viruses (SIV) mutating Tanzania, concluding subtype D to be theinto HIV. most deadly, followed by C, then A-C-D Evidence points to at least three recombinants, and the least problematic beingindependent introductions of SIVcpz from A. It is likely that most of the African M-chimpanzees to humans. Zoonotic subtypes (A, C, D), plus the Thai subtype E, 4
  10. 10. are more virulent than the B subtype common Natural History of HIV-AIDS inin the US, Europe and Haiti. Korber argues Individualsthat the B-subtype which became manifest in One problem that has always plagued thethe mid-1970s, likely had a pre-epidemic HIV theory of AIDS is that it does notperiod of evolution of 5-15 years, possibly directly cause the syndrome. Rather, the usualbeginning in 1960 (circa 1939-1972). Despite proximate ailments that are part of thea large degree of regional specialisation, all complex are all caused by other micro-the M-subtypes exist globally, likely organisms. HIV is said to ultimatelymigrating from sub-Saharan Africa as a result precipitate these ailments by destroying theof imperial pursuits, trading and wars of helper white blood cells (CD4+ T-cells).independence. When levels of such lymphocytes are at HIV-1 is significantly more virulent than critically low levels—which could take tenHIV-2 (Jaffer 2004), while the natural history years or more—immunodeficiency sets inof HIV-2 is more certain. HIV-2 has seven where any number of AIDS diseases cansub-types, HIV-2(A-G), with only HIV- manifest themselves. The most common2(A,B) being epidemic in nature. HIV-2 is ailments being serious cases of skin cancer,restricted mainly to western Africa tumours, pneumonia, thrush, herpes, and(especially Guinea-Bissau). It originated from painful feet and legs.cross-species infection between sooty What is called the “natural history” ofmangabeys (monkeys) and humans through HIV in the human body includes three mainSIVsm due to dietetic, social and sexual phases (see Figure 2). The first phase isfactors. The most recent common ancestors “acute” infection with the virus, whetherhave been estimated at 1940±16 (HIV-2A) through sexual contact, dirty needles, and/orand 1945±14 (HIV-2B), which are possible blood exchanges. When the virus infects theupper limit proxy dates for cross-species body, “seroconversion” occurs as the bodytransmission of SIVsm, although a broader starts to produce antibodies to the parasite.model gives 1889±33 as a lower limit for Some people succeed in stopping the virus atcross-species transmission (Lemey 2003). this point, but in others there is a sudden For group A, after cross-species infection increase in viral load in the cells and a sharpand mutation into HIV-2, there was a period decline in helper T-cells below the normalof low endemicity (eg, 1930-1963) in this level of 1000/μL (1000 per micro-litre),closely-knit, kinship-based society of Guinea- especially in the mucus cells and to a lesserBissau. This was followed by a period of extent in the blood. A major immuneexponentially increasing infections (1963- response occurs as the body produces1992) likely initiated by the war of antibodies to the invading virus. Usuallyindependence from Portugal (1963-1974), relatively minor symptoms emerge, includingwhen social dislocation and trans-migration swollen lymph glands, fever, diarrhoea, drywere common. The war hypothesis is cough, numbness of the feet, and other vaguesupported by epidemiological evidence of symptoms. This phase may last a number ofHIV-2 cases among Portuguese veterans who weeks or months, at the end of which theserved in the colonial army during the war. number of helper cells (CD4) stabilises, asThe principle source of the exponential does the viral load and the immune response.growth is said to be the high rate of The second major phase is then reached inunsterilised injections. most HIV cases, the “chronic” stage, which lasts on average about ten years, with 5
  11. 11. variations mostly in the order of 3-5 years. the body’s immune response is slow andSome call this the asymptomatic “latency” ineffective. Some of the typical AIDS-period, since the mortality-promoting (late- defining diseases include pneumocystitisperiod) opportunistic diseases (“AIDS”) have Pneumonia, Kaposi’s sarcoma, AIDS-relatednot yet appeared. In this slow moving phase lymphoma, peripheral neuropathy, andmajor symptoms typically do not emerge. A opportunistic diseases.number of patients never go beyond this stage It has to be said that HIV and AIDSand hence never get the typical AIDS reveals (or exploits) a major limit to thediseases, with or without anti-viral drugs. Yet human immune system. This limit occurs inafter a number of years mucosal CD4 helper- the chronic phase when CD4 T-cells declinecells decline moderately, while CD4 helper- while CD8 T-cells increase, in about equalcells in the blood decline slowly but proportions, while total T-cells remain aboutsignificantly. At the end of this 10 year period constant. CD4 and CD8 refer to aCD4 helper T-cells typically decline from heterogeneous group of cell-surfacetheir normal level of around 1000/μL to the glycoproteins on T-lymphocytes that enhanceAIDS-defining level of <200/μL. Immune T-cell response to foreign antigens. Inactivation stays at a high level, while viral general, though, CD4s are called “helper” T-load increases only slightly. cells because they assist other white blood cells perform their immune function; whileFigure 2: Typical Natural History of HIV-AIDS in CD8 cells include “killer” T-cells that canSusceptible Individuals (stylized)T-cells/μL Viral Load, destroy infected target cells (Mosier 1997). Immune Activity More specifically, CD4 cells provide helper1200 functions for proper development of T-cell Immune cytotoxicity and also for B-cells to produce Activation1000 immunoglobulin and lymphocyte populations. CD8 CD8 cells inhibit the proliferative response of infected cell immunoglobulin creation. CD4 and CD8 cells are more effective when CD4500 working in tandem and their functions are somewhat interrelated, since killer CD4 cells and helper CD8 cells also exist (Parnes 1997). HIV-1 It is generally believed that CD4 functions Acute Chronic (Latency) AIDS are more critical than those of CD8 cells. But Months 6-14 Years 1-3 Years the body’s homeopathic system responds only to changes in total CD cells. While theSource: Adapted from Grossman et al (2006:293); Joly(2006:858); Lederberg (2000:90); Feinberg (1996:241,244) critical CD4 cells decline with HIV progress, since they act as cell-surface receptors for The third phase of the condition then HIV, no effective response is made totypically begins to manifest as AIDS around increase their production because CD8 cellsthe 10 year (6-14 year) period as helper T- are increasing instead. Hence the major limitcells decline to very low levels (<200/μL) of human immunological function that HIVlevel, viral load begins to escalate, and exploits. As a result, when CD4 cells areimmune activation declines somewhat. A below 200/μL a combination of the followingcombination of major diseases, caused by diseases tend to develop, while death usuallyspecific organisms, then begin to develop as follows CD4 levels of below 50/μL, as these 6
  12. 12. diseases become more serious. HIV thus does of HIV patients, and including anot directly cause AIDS, but is said to heterogeneous group of AIDS-relatedeventually lead to a combination of infections lymphomas (ARLs) (Silvestris et al 2002).when CD4 levels reach very low levels and The most common include cancers caused bythe body is apparently unable to develop the Epstein-Barr virus (EBV), HHV-8 andeffective resistance to disease. through other, genetic propensities. One interesting variety is PEL, associated withPneumocystis Pneumonia (PCP). PCP is the HHV-8 and EBV, manifesting as tumourmost common opportunistic HIV-related masses, especially in the gastrointestinal tract.infection, occurring in up to 85% of AIDS Systemic ARL attacks the immune system,cases. Historically it has been the most blood stream and organs simultaneously.important cause of morbidity, associated with While chemotherapy, azidothymidine andthe fungus pneumocystis jiroveci. It is most rituximab have proved toxic in the treatmentcommon with CD4 cell counts of under 200/ of ARL, some success was found by minimalμL, and also for those with under 300/μL who chemotherapy followed by HAART (Lim andhave other opportunistic infections. It affects Levine 2005) for patients with CD4+ cellthe lungs, typically causing recurring counts of >100/μL. Prognosis is poor forpneumonia, breathing difficulties, fever, dry those with <100/μL.cough, weight loss, and constitutionalweakness. It can be treated now quite Opportunistic Infections (OIs). OIs are aneffectively with combination antibiotics array of diseases that in combination canTMP/SMX, Dapsome, Pentamidine, contribute to morbidity in patients with low-Atovaquone and antiretroviral therapy (ART). CD4 levels. The most important of them, PCP, is important enough to be consideredKaposi’s Sarcoma. This is a common ailment, separately (above). The others can undercaused by the human herpesvirus-8 (KSHV), some circumstances be critical, and includeaffecting around 20% of AIDS cases. It thrush (a fungal infection) of the mouth,usually takes the form of various lesions, throat, anus and/or vagina, even in high CD4tumours, and ulcers on the skin and ranges; cytomegalovirus (a viral infection)sometimes in lymph nodes, mucosal surfaces, that can cause blindness, especially in <50and internal organs (Cornelius et al 2004). It CD4 cases; serious cases of herpes simplexcan be localised, indolent, widespread or (virus) of the mouth or genitals, at any CD4aggressive. KSHV typically evade level; mycobacterium avium complex, whichrecognition by T-cells by using human causes recurring fever, digestion anomalies,protein cell molecule xCT to reproduce itself general sickness, and serious weight loss,(NIH 2006). Chemotherapy, radiation, especially with CD4 counts of <75/μL;retinoic acid, liposomal and anti-cancer drugs toxoplasmosis, a protozoal affliction of thehave been used against this disease; and brain, typically for those of CD4 counts ofincreasingly through the effective use of <100/μL; plus malaria and tuberculosis,highly active antiretroviral therapy which tend to be more severe with AIDS.(HAART). (NMAETC 2005.)AIDS-Related Lymphoma (ARL). This is the Peripheral Neuropathy. This is the mostthird most common immunodeficiency common neurological complaint associateddisease, being the cause of death for 12-16% with AIDS. It represents a whole series of 7
  13. 13. neurological diseases, more commonly The multifactorial approach looks at theassociated with sore feet, weak muscles, link between a number of critical variables,numbness and tingling in peripheral nerves, as, for instance, shown below in Figure 3:back pain, and bowel and bladderincontinence. It may become systemic to Figure 3. Multiple Factor Approach to AIDSinclude gastrointestinal weakness, hepatitis, HIVpneumonia, cervicitis and pancreatitis when Viral Other Strain Otherassociated with cytomegalovirus (CMV). A STDs Microbesdisturbingly high number of cases areprecipitated by antiretroviral drugs, especiallyNRTIs, while the disease itself may Drugs AIDS Geneticspredispose individuals to the neurotoxic Diseaseseffects of these medications. However,evidence seems to point to the positiveinfluence of HAART in the prognosis of Demography Nutritionpatients (Ferrari et al 2006). It is worth emphasising that HIV develops Socio-into AIDS at different rates in different risk Economicsgroups. For instance, haemophiliacs, olderpatients, those in lower socioeconomic Research indicates that the degree to whichgroups, and those with synergistic infections individuals are susceptible to the HIV virusand cofactors, develop AIDS much quicker depends upon an array of factors, includingthan the average 10 years: 2-3 years is genetics, diet, stress, other infections, and thecommon. Quite a few HIV-positive people do specific strain of HIV in question. Similarly,not manifest symptoms or go on to develop the speed and magnitude to which initial andAIDS (5%). Some are even repeatedly tested later AIDS symptoms and diseases progressHIV-negative after being found seropositive. depend on this complex pattern of lifestyle,This is related to the concept of transient or genetics and socioeconomic position.incomplete infection where sero-reversion Individuals are more likely to progress to(from HIV-positive to negative) occurs in AIDS with HIV-1(D) than HIV-1(A) or (B),healthy individuals. (Root-Bernstein 1996.) and also with HIV-1 than HIV-2. Individuals are also more likely to comeCofactors and Causal Controversy down with AIDS-defining diseases if theyEarly in the history of AIDS research lifestyle have a poor diet, especially if lackingfactors were emphasised, such as sexual vitamins A, C and E; ingest substantial amylpreference, sexual activity, drug use, nutrition or butyl nitrate, chemotherapy or toxic anti-levels, and so on. With the discovery of the retroviral drugs (not HAART); are older;HIV link to declining helper cells the viral and/or infected by critical microbes causingfactor became predominant. This is still the hepatitis, thrush or herpes. (Strathdee 1996.)case today. However, evidence does support a Many people are HIV-positive but fail tomultifactorial approach, and a substantial develop symptoms, others have symptoms butcritique of the viral theory exists among a live for decades, while numerous others haveminority of researchers. AIDS-type diseases but are HIV-negative. Cofactors thus become critical to the mortality and well-being of individuals, 8
  14. 14. acting as risk modifiers that impact on CD4 causal models are seen as reductionist andlevels, viral load and disease manifestation. inferior to more holistic models of analysis. Some researchers have a particular angle Many critique the assumption of HIV-on cofactors, strongly attacking the positive results necessarily linking to AIDS.mainstream emphasis on HIV. They either It is argued that being HIV-positive simplygive priority to cofactors or deny the role of means the body has produced antibodiesHIV altogether. Peter Duesberg and his against HIV in the past; it is not necessarilyassociates tackle the HIV theory in the most evidence that HIV is currently active in thecritical fashion, concluding that recreational system. The best way to prove the presence ofand antiretroviral drugs are the major cause of a virus is said to be through direct isolationAIDS in the US and Europe, whereas and estimation of infectious particle numbersmalnutrition is the main culprit in Africa and in immobilized cell culture. A correlationmany other underdeveloped areas. Others between HIV and AIDS may exist because ofmay be less extreme, concluding that HIV a combination of specious factors. Thesemay be neither necessary nor sufficient (or include the negative psychological impact ofnecessary but not sufficient) for the onset of being found HIV-negative; the negativetypical AIDS-defining diseases such as impact of HIV drugs (including wide-Kaposi’s sarcoma, AIDS related lymphoma, spectrum antibiotics) on the immune system.opportunistic infections and peripheral Many HIV-positive people do not get sick,neuropathy. while others work off the virus. The Duesberg-type arguments against the Many HIV-negative patients have all the“HIV-causes-AIDS” hypothesis are complex typical symptoms of AIDS, including aand multifarious, some technical and others combination of low CD4-count, opportunisticgeneral (Papadopulos-Eleopulos et al 1996). infections, Kaposi’s sarcoma, pneumonia, andMany of his supporters argue, for instance, so on. Also, there is a paucity of studiesthat HIV is an opportunistic or synergistic investigating patterns and processes involvinginfection—or possibly just a “passenger CD4+ cell levels among HIV-negativevirus”—that becomes manifest only in people people. Could the high level of CD8+ T-cellspredisposed to or in contact with agents that adequately compensate for the low level ofpropel immune deficiency. AIDS is seen as CD4+ T-cells in typically symptom-free HIVprimarily an immunodeficiency (not a viral) cases, since some research has indicated adisease, where cofactors propel cumulative cross-over of functions between CD4 andimpairment of the immune system and leads CD8 T-cells in some cases?patients to be predisposed to (passenger) 90 percent of AIDS patients emanate fromHIV. It is seen as a multiple agent-induced high risk groups, such as homosexual orseries of conditions where cooperative bisexual men; injecting drug users; recipientsinfections create magnified destruction of the of blood and its components; inhabitants ofeffective immune response. For instance, undeveloped nations; and sexual partners ofolder haemophilia patients typically develop injecting drug users. These groups have aAIDS very rapidly, within 2-3 years, due to very high risk of low CD4+ levels, cancers,frequent use of clotting concentrates, lymphoma, and opportunistic infections duetransfusions, steroidal use, viral to a combination of factors, such as beingcontamination, opiate drugs and joint injury inflicted with other venereal diseases, thetreatment (Root-Bernstein 1996). Mono- known impact of certain drugs on the immune 9
  15. 15. system, malnutrition, and low socioeconomic company are correct then most of the rest ofposition. (Koliadin 1996). the scientific community are wrong. Many argue that the typical time taken This conclusion, however, is not quitefrom being HIV-positive to full-blown AIDS true, since a multifactor analysis of AIDSis excessive. The usual 6-14 years for the comes close to allowing for both majoronset of typical diseases has been shown to be groups being at least partially correct in theirproblematic on mathematical grounds, analysis. And it is this multifactor approachespecially vis-à-vis the usual periodicity of that this paper utilises as perhaps the best wayviral toxicity. One such model predicts that to comprehend AIDS. With this in mind wethe number of T-cells in a HIV+ person turn to the socioeconomic impact and policy-should have fallen by 84% in two years. As responses of the pandemic.Mark Craddock (1996: 93) says: “it is verydifficult to see why a large number of Socioeconomic and Political Factorsinfected cells actively replicating takes so The question now arises as to what are thelong to cause a disease. … Such a virus socioeconomic and political impacts of AIDSshould cause disease quickly or not at all.” and HIV, as well as the governance responses A paradox of the HIV-AIDS hypothesis is that may reduce the extent of the epidemic.said to be that a virus that is present in 1 out Eurocentric works concentrate on the natureof 500 susceptible CD4+ T-cells could cause of the problem in the US or Europe. Thisdisease. Such a virus should also destroy such despite the fact that here AIDS problems areT-cells because control of such cells is no longer on an escalating scale. The realsupposed to promote reproduction of viral crisis is in Sub-Saharan Africa, and to a muchload. Viruses are parasites that require a lesser extent in the Caribbean and parts ofliving host and cell to reproduce. CD4+ T- south Asia. In SSA as a whole AIDScells must, it is argued, therefore, be killed by constitutes a system-problem inhibiting theother agents, such as recreational drugs, anti- very function of the social, political andretroviral drugs, chemotherapy, inadequate economic institutions. It therefore requiresnutrition, and opportunistic infections. core assistance from the international(Duesberg et al 2003: 403). community. However, it has to be said that A strange situation has arisen in the AIDS is really an extension of the traditionalscientific community where the “Duesberg problems of underdevelopment, poverty andcamp”, which is globally quite numerous, is malnutrition. No matter what theory of AIDSoften given some limited degree of space for one adheres to, the challenge is to propeltheir work, while at the same time being human development in the region as onediscouraged and excluded (more often) from critical solution to AIDS.publication. When government has taken their Anomalies of underdevelopment arearguments seriously, such as President Thabo reinforced by AIDS, although regionalMbeki in South Africa, they have been differences are important. Real economicdenounced by many in the international growth per capita has been less than 1community, even by those who are not percent per annum in SSA during the 1990sscientists or health professionals (eg, Butler and 2000s (O’Hara 2006). In one study, the2005). John Maddox (1995), the editor of average rate of adult-prevalence of AIDS inNature, states succinctly his understanding of SSA is about 8 percent, resulting in a declinethe reason, namely, that if Duesberg and in GDP growth of 0.5 per annum, or 27 percent over 20 years, as a result of declining 10
  16. 16. human, physical and social capital. 30% for Ethiopia. These welfare losses are far(Freedman et al 2005:671). However, the greater than the narrower economic costs.impact in many nations of SSA are much These large social costs of AIDS are duegreater; especially in Botswana, Lesotha, to magnified results of a multitude of factors,Namibia, and South Africa, where GDP is illustrated in Figure 4, below. The inability oflikely to decline by 50-70 percent over twenty certain African nations, in particular, to getyears due to AIDS (Haacker 2004:71). beyond the epidemic phase of the disease is AIDS causes lower growth due to linked closely to centre-periphery dynamics.declining levels of productivity, increased Many SSA nations adopted key planks of theabsenteeism, loss of experience and skills, neoliberal policy framework, whichhigh labour turnover, and greater recruitment contributes to declining emphasis on publicand training costs. Declining income capital such as physical infrastructure,reinforces this through deteriorating levels of education, health, and communications sectordemand and low multiplier and accelerator development. Partly for this reason, socialeffects. AIDS especially impacts on resources have been severely limited ingovernance as public officials become sick, dealing with the AIDS crisis. In addition,while education is severely impacted as the high levels of poverty, malnutrition and deathstudent-teacher ratio increases and the stock are perfect breeding grounds forof knowledge declines or increases at a lower immunodeficiency and the spread of HIV.rate. Community trust and interaction High levels of brain drain sap the energy ofdiminish as networks are disrupted and bonds especially the business, health, education andof sociality destroyed. Also, government governance sectors. Social instability linkedspending is redirected from physical to wars of independence, ethnic conflict,infrastructure, communications and education changes in sexual mores and habits, plusto the US$4.23 billion spent on HIV-AIDS drought and famine lead the virus to beprojects per annum in low-income nations spread more rapidly through the community.(Haacker 2004:63). Inadequate political capital delay and Mortality has been greatly increased in diminish the vital responses needed especiallySSA as a result of AIDS. Life expectancy at in the early-medium stages of the epidemic.birth with AIDS is markedly different thanwithout it in many nations. For instance, the Figure 4. Magnified Impact of Multiple Factors on AIDS in Sub Saharan Africaaverage life expectancy for a Botswanan iscurrently 34 years, and without AIDS it Social Dislocationwould have 76 years (2004). For South Africa Neoliberal & Conflict Sexualthe figures are 67 years without AIDS and 44 Practices Mores & Habitsyears with it; while for Zambia people would Needlehave on average expected to live to 56 years, Exchange & Inadequatewhile they actually live on average 39 years. Recreational AIDS Political Drugs CapitalCrafts et al (2004:189) call this situation“catastrophic” and estimate the welfare losses Mortalityinvolved. Using a “value of life” model, they Brain & Drain Malnutritionestimate the aggregate decline in welfare Inadequate(based on “discounted life expectancy”) of Human Capital93% for Botswana, 77% for South Africa,75% for Zambia, 44% for Cote d’Lvoire, and 11
  17. 17. More generally, AIDS in SSA takes the change in individuals needs to recognise theform of a crisis in social reproduction (Bujra multifaceted environment in which they2004). The multiple factors associated with operate.AIDS have multiplied the extent of the social The second plank follows from the first,dislocation since social support structures namely, that policy-making in an AIDShave diminished, protective responses to environment needs to be multi-sectoral,AIDS are insufficient, and community including a high level of politicalresources exhausted (O’Hara 2007). commitment, with extensive communityDevelopment has been inhibited as mortality involvement. These seem to be the priorityrates are high, human capital levels in short areas of the most successful approaches, forsupply, and networks of relations have been instance those undertaken in Uganda,dislocated. Socioeconomic fragmentation is Senegal, Thailand and Brazil (Moran 2004).promoting AIDS which further stimulates Being multi-sectoral involves decision-disarray and dislocation (Freedman et al making across a wide range of actors and2005). AIDS and its cofactors are thus participants. The major sectors that need to beseverely inhibiting the achievement of the included are government, NGOs and civilNew Millennium Goals by 2015 of society.eradicating extreme poverty and hunger, Governments can help through leadership,achieving universal primary education, providing resources and coordinatingpromoting gender equality, reducing child communication and interaction. For instance,mortality, improving maternal health and in Uganda where AIDS prevalence hasensuring environmental sustainability declined since the early 1990s, President(Whiteside 2005). Museveni played a key role in stimulating debate and action among core communityFurther Governance Issues and Practices groups. Uganda also has a decentralisedFive planks of policy are critical for reducing system of governance where regional andand understanding the incidence of AIDS, community players have key roles. In mostespecially in Sub-Saharan Africa, but also successful AIDS policy environments, theother continents. The first plank is that a Department of Health is especially important,multi-factor approach needs to be utilised. being at the centre of education andThis is one that recognises the importance of awareness campaigns. An over-centralisedcofactors, such as viral load, other microbes, approach (such as in South Africa) will likelydrugs, genetics, socioeconomic status, inhibit success by denying community inputnutritional and lifestyle factors, culture, and participation (Butler 2005).prevention, and demography. Policies that Governments need, though, to take intoincorporate these multiple contributors to the account the cultural beliefs and values withindisease are more likely to impact than those civil society. AIDS policies are unlikely tothat take a more reductionist approach. Being succeed where the community has not beenmore holistic, the cofactor method seeks to actively engaged. If state policies go againstsituate individuals within the social and the dominant values in the community it iseconomic context of their predicament. In this unlikely that they will succeed. For instance,sense it takes into account their age, gender, a conservative religious community thatcultural embeddedness, general health, believes in the values of abstinence and notinfection status, habits and network relations. being open about sex—such as inAny policy that seeks to promote behavioural Botswana—is unlikely to be inspired by a 12
  18. 18. policy advocating the widespread use of This involves dissemination of knowledge,condoms and sex education, at least in the modification of habits, and implementation ofshort to medium term. (Allen and Heald preventative and prophylactic methods. This2004.) In such a conservative environment, variously requires a reduction in the extent ofsubtle influence on the community is more needle sharing, declining sexual promiscuity,likely to succeed in the long run. improved health, poverty reduction, and The third plank of governance needs to declining illiteracy. These measures link torecognise the limitations of policy in an both anti-AIDS measures and broaderenvironment where human resources are development goals. Ultimately, especially inlikely to be scarce. In much of Sub-Saharan developing nations, the fight against AIDS isAfrica the number of health workers, teachers also a fight against ignorance, poverty andand administrators are limited not only by malnutrition.low levels of development but also by AIDS It is worth noting that the decliningitself. For instance, in Malawi during 1990- incidence curve for diseases will eventually2000 the average rate of such human capital come into play in SSA, as it has in the West.attrition has been 2.3% per annum among In SSA as a whole, and some other areas,these core groups, mainly due to death by however, it is unlikely to occur for a decadeAIDS. The majority of those who die from or two. However, it is important not toAIDS are in their prime sexual, reproductive miscalculate successful policy-making for theand productive period of life. This loss of declining incidence curve. Declininghuman capital is magnified by brain drain to incidence may occur, for instance, when amore developed areas, and severely less virulent strain of the virus is dominant.constrains policy measures to educate and Successful policies can also bring on anequip societies for reducing AIDS. (Moran earlier incidence of the curve.2004.) A fourth plank of successful policy relates Conclusionto access to critical knowledge, technology This article has developed a holistic view ofand materials. Technology is a key aspect of the AIDS and HIV predicament that hasany modern policy paradigm. In nations with befallen humanity. It started by surveying thehigh rates of AIDS it is difficult to access historical and natural evolution of theknowledge, products and processes that may condition, including its global geographicalhelp alleviate the condition. Being able to incidence and individual patterns. Thepromote networks of access to products that historical origins of the HIV virus wereare subject to patents can help access to examined, along with the major AIDSantiretroviral treatment, including drugs and conditions. Special reference was given to apotential vaccines. For instance, collaboration multi-factor approach that is capable ofwith NGOs and local companies enabled including apparently incompatible scientificmany poor countries to locally produce cheap perspectives on AIDS. The paper concludedgeneric AIDS drugs. Linkages to global with some policy perspectives and policieshealth and medical research networks may in for the future.the future enable (poor) countries to access While AIDS has followed a decliningHIV vaccines (McMichael 2006). trajectory in the West, it is propelling The fifth plank of anti-AIDS policy socioeconomic disarray in Sub-Saharanrecognises that, ultimately, individual Africa and potentially many other places. Thebehaviour modification is the key to success. multi-causal model can also be linked to 13
  19. 19. policy through a multi-sector approach. Such Macroeconomics of HIV/AIDS.an approach recognises the need to include Washington DC: IMF, pp. 182-197.governments, communities, NGOs and Dornburg, Ralph and Roger J. Pomerantz.corporations in a strategy of modifying (2000) “Retroviruses”, in Josua Lederbergindividual behaviour. Central governments (Ed), Encyclopedia of Microbiology. Newcan provide leadership, Health Departments York and London: Academic Press, pp. 81-coordinate education and intervention, 96.cultural values and habits need to be Duesberg, Peter H.;Claud Koehnlein andaddressed, and corporations may assist in David Rasnick. (2003) “The Chemicalproviding resources and drugs. Bases of the Various AIDS Epidemics: AIDS and HIV need also to be situated in Recreational Drugs, Anti-Virala broader context of development. While a Chemotherapy and Malnutrition”, Journalnaturally declining curve of incidence will of Biosciences, Volume 28, Number 4,eventually prevail, even in the worst affected June, pp. 383-412.areas, linking AIDS and development policies Feinberg, Mark B. (1996) “Changing theare likely to speed up the trajectory. AIDS Natural History of HIV Disease”, Thedoes not exist in a vacuum but is affected by Lancet, Volume 348, Number 9022, 27and in turn impacts negatively on resources, July, pp. 239-246.human capital and institutions. Seen as a Ferrari, Sergio; Sandro Vento, Salvatoremulti-causal process, both AIDS and Monaco, Tiziana Cavallaro, Francescounderdevelopment can be tackled as a Cainelli, Nicola Rizzuto and Zelalemproblem of interacting processes. Temesgen. (2006) “Human Immunodeficiency Virus―AssociatedSelected References Peripheral Neuropathies”, Mayo ClinicAllen, Tim and Suzette Heald. (2004) Proceedings, Volume 81, Number 2, “HIV/AIDS in Africa: What Has Worked February, pp. 213-219. in Uganda and What has Failed in Freedman, Jane and Nana Poku. (2005) “The Botswana”, Journal of International Socioeconomic Context of Africa’s Development, Volume 1, pp. 1141-1154. Vulnerability to HIV/AIDS”, Review ofBujra, Janet. (2004) “AIDS as a Crisis in International Studies, Volume 31, pp. 665- Social Reproduction”, Review of African 686. Political Economy, Number 102, pp. 631- Gao, Feng; Elizabeth Bailes, David 638. Robertson, Yalu Chen, Cynthia RodenburgButler, Anthony. (2005) “South Africa’s et al. (1999) “Origin of HIV-1 in the HIV/AIDS Policy 1994-2004: How Can it Chimpanzee Pan Troglodytes be Explained?”, African Affairs, Volume Troglodytes”, Nature, Volume 397, 104, Number 417, pp. 591-614. Number 6718, February, pp. 436-441.Cornelius, J.G. Sanders; Marijke R. Grmek, Mirko D. (1990) History of AIDS: Canninga-van Dijk; and Jan C. Borleffs. Emergence and Origin of a Modern (2004) “Kaposi’s Sarcoma”, The Lancet, Pandemic. Princeton University Press: Volume 364, October 23, pp. 1549-1552. Princeton, New Jersey. Translated byCrafts, Nicholas and Markus Haacker. (2004) Russell C. Maulitz and Jacalyn Duffin. “Welfare Implications of HIV/AIDS”, in Grossman, Zvi; Martin Meir-Schellersheim; Markus Haacker (Ed), The William E. Paul and Louis J. Picker. (2006) “Pathogenesis of HIV Infection: What the 14
  20. 20. Virus Spares is as Important as What it National Academy of Sciences, Volume Destroys”, Nature–Medicine, Volume 12, 100, Number 11, 27 May, pp. 6588-6592. Number 3, March, pp. 289-295. Lemey, Phillipe; Oliver Pybus, AndrewHaacker, Markus. (2004) “HIV/AIDS: The Rambaut, Alexei Drummond, David Impact on the Social Fabric and the Robertson, Pierre Roques, Michael Economy”, in Markus Haacker (Ed), The Worobey and Anne-Mieke Vandamme. Macroeconomics of HIV/AIDS. (2004) “The Molecular Population Washington DC: IMF, pp. 41-98. Genetics of HIV-1 Group O”, Genetics,Jaffer, Shabbar; Alison Grant, Jimmy Volume 167, July, pp. 1059-1068. Whitworth, Peter Smith and Hilton Lim, Soon Thye and Alexandra M. Levine. Whittle. (2004) “The Natural History of (2005) “Recent Advances in Acquired HIV-1 and HIV-2 Infections in Adults in Immunodeficiency Syndrome (AIDS)- Africa: A Literature Review, Bulletin of the Related Lymphoma”, CA: A Cancer World Health Organization, Volume 86, Journal for Clinicians, Volume 55, Number 6, June, pp. 462-469. Number 4, July/August, pp. 229-241.Joly, Marcel and Jose M. Pinto. (2006) “Role Craddock, Mark. (1996) “Some Mathematical of Mathematical Modeling on the Optimal Considerations on HIV and AIDS”, in Control of HIV-1 Pathogenesis”, American Peter H. Duesberg (Ed), AIDS: Virus or Institute of Chemical Engineering Journal, Drug Induced? Boston and London: Volume 52, Number 3, March, pp. 856- Kluwer Academic Publishers 1996, pp. 89- 884. 95. Reprinted from Genetica, Volume 95,Koliadin, Vladimir. (1995) “Critical Analysis Numbers 1-3. of the Current Views on the Nature of Maddox, John. (1995) “Letter to Peter H. AIDS”, in Peter H. Duesberg (Ed), AIDS: Duesberg” (2 March), in Peter H. Duesberg Virus or Drug Induced? Boston and (ed), AIDS: Virus or Drug Induced? London: Kluwer Academic Publishers Dordrecht, Netherlands and London UK: 1996, pp. 69-88. Reprinted from Genetica, Kluwer, pp. 120-121. Volume 95, Numbers 1-3. McMichael, Andrew J. (2006) “HIVKorber, B; M. Muldoon; J. Theiler; F. Gao; Vaccines”, Annual Review of Immunology, R. Gupta; A. Lapedes; B. Hahn; S. Volume 24, pp. 227-255. Wolinsky and T. Bhattacharya. (2000) Moran, Dominique. (2004) “HIV-AIDS, “Timing the Ancestor of the HIV-1 Governance and Development: The Public Pandemic Strains”, Science, Volume 288, 9 Administration Factor”, Public June, pp. 1789-1796. Administration and Development, VolumeLauer, Helen. (2006) “Cashing in on Same: 24, pp. 7-18. How the “Tradition vc. Modernity” Mosier, Donald E. (1997) “Acquired Immune Dualism Contributes to the “HIV/AIDS Deficiency Syndroome, T-Cell Subsets”, in Crisis” in Africa”, Review of Radical Renato Dulbecco (Ed), Encyclopedia of Political Economics, Volume 38, Number Human Biology. London and NY: 1, Winter, pp. 90-138. Academic Press, pp. 43-47.Lemey, Phillipe; Oliver Pybus, Bin Wang, NIH. (US National Institute of Health) Nitin Saksena, Anne-Mieke Vandamme. Landmark Discovery of a Kaposi’s (2003) “Tracing the Origin and History of Sarcoma-Associated Herpesvirus Receptor the HIV-2 Epidemic”, Proceedings of the Provides new Perspectives on Disease Associated with HIV/AIDS. US 15
  21. 21. Department of Health and Human International Journal of Oncology, Services, 6 April 2006. Volume 20, pp. 611-615.NMAETC. (New Mexico AIDS Education Strathdee, Steffanie; Robert Hogg, Michael and Training Centre) (2005) Opportunistic O’Shaughnessy; Julio Montaner and Infections—AIDS INfoNet. Fact Sheet Martin Schechter. (1996) “A Decade of Number 500. NMAETC: New Mexico. Research on the Natural History of HIVO’Hara, Phillip Anthony. (2006) Growth and Infection: Part 2. Cofactors”, Clinical and Development in the Global Political Investigative Medicine, Volume 19, Economy: Social Structures of Number 2, April, pp. 121-130. Accumulation and Modes of Regulation. UNAIDS/WHO (Joint United Nations London and New York: Routledge/Taylor Programme on AIDS and World Health & Francis. Organization) (2005) AIDS EpidemicO’Hara, Phillip Anthony. (2007) “The Global Update December 2005. Geneva: Spread of AIDS and HIV”, Journal of UNAIDS. Economic Issues, Volume 41, Number 2, Whiteside, Alan. (2006) “HIV/AIDS and June, pp. 459-468. Development: Failures of Vision andPapadopulos-Eleopulos, Eleni; Valandar Imagination, International Affairs, Volume Turner; John Papadimitrior; David Causer; 82, Number 2, pp. 327-343. Bruce Hedland-Thomas and Barry Page. Vassan, Ashwin; Boris Renjifo, Ellen (1996) “A Critical Analysis of the HIV-T4- Hertzmark, Beth Chaplin, Gernard cell-AIDS Hypothesis”, in Peter H. Msamango, Max East, Wafaie Fawzi and Duesberg (Ed), AIDS: Virus or Drug David Hunter. (2006) “Different Rates of Induced? Boston & London: Kluwer, pp. Diseas Progression of HIV Type 1 3-22. Reprinted from Genetica, Volume 95, Infection in Tanzania Based on Infecting Numbers 1-3. Subtype”, Clinical Infectious Diseases,Parnes, Jane R. (1997) “CD8 and CD4: Volume 42, pp. 843-852. Structure, Function, and Molecular Biology”, in Renato Dulbecco (Ed), Phillip Anthony O’Hara Encyclopedia of Human Biology. London Global Political Economy Research Unit and NY: Academic Press, pp. 455-465. Curtin University, PerthRoot-Bernstein, Robert S. (1996) “Five Australia Myths about AIDS that have Misdirected gpeproject@yahoo.com Research and Treatment”, in Peter H. Duesberg (Ed), AIDS: Virus or Drug Induced? Boston and London: Kluwer Academic Publishers 1996, pp. 185-206. Reprinted from Genetica, Volume 95, Numbers 1-3.Silvestris, Nicola; Enrico Crucitta; Vito Lorusso; Teresa Gamuccia and Mario de Lena. (2002) “AIDS-Related Non- Hodgson’s Lymphona: Clinico- Pathological Characteristics and Therapeutic Strategies (Review)”, 16
  22. 22. Balance of Payments asset flows, and the KA is in equilibrium, surplus or deficit, if payments equal, fall Matias Vernengo behind or exceed receipts, respectively. The overall BP is given by the net result ofIntroduction the CA and KA. So that, if a CA surplus isThe Balance of Payments summarizes all the matched by a deficit in the KA, then the BP istransactions between a country and the rest of in equilibrium. In a fixed exchange ratethe world. The BP is usually divided into two system—when the monetary authority standsmain accounts, namely: the Current Account ready to buy and sell the major currencies on(CA) and the Capital Account (KA). a continuous basis, at specified bid and ask The current account includes the exports prices—an overall BP surplus or deficit mayand imports of goods and services, the former occur. When there is a balance of paymentsappearing as credit items and the latter as surplus the official exchange reserve holdingsdebit components. Exports of commodities of the central bank will increase, and theygive rise to a claim on the rest of the world will decrease in the case of a BP deficit. Inthat foreigners must discharge by making formal termspayments to the domestic producers, and viceversa in the case of imports of commodities. (1) BP = CA + KA = ∆RExports and imports of services—such astravels, interest and dividends of investments, where ∆ R stands for the variation in officialand unilateral transfers—imply analogous reserve holdings. For example, if a CAtransactions. It is important to note that surplus exceeds a KA deficit, there will be aninterest payments on outstanding debt are part excess demand for the domestic currency. Toof the current account, and in several cases avoid the appreciation of the domesticthis is the most important component of the currency the central bank will sell domesticbalance of payments. The transactions in the currency, and accumulate foreign reserves.CA generate income flows, and the CA is in Under a flexible exchange rate regime—inequilibrium, surplus or deficit, if payments which the exchange rate is free to floatequal, fall behind or exceed receipts, without intervention from the central bank—respectively. the overall BP must be in equilibrium, since The capital account includes foreign direct deficits and surpluses will be eliminated byinvestment (FDI) and portfolio investments, exchange rate changes, rather than changes inin which the latter constitute the so-called hot reserve holdings. A surplus in the CA impliescapital flows, that is, the purchase of financial that the domestic currency will appreciate,assets rather than equipment, machines or leading to a rise in the price of imports and ainstallations. When a domestic firm, or fall in the price of exports, that will stimulatehousehold, purchases foreign assets—e.g. a exports and discourage imports, eliminatingproductive plant, real state, or a financial the CA surplus.instrument—an outflow of capital is The remainder of this entry will discussgenerated. Capital outflows are accounted as briefly the main theories, and theirdebits, since the domestic buyer has to pay to limitations, explaining the process of balancethe foreign seller, in the same way that an o payments adjustment, and the literature onimporter of goods and services would do. By the causes of balance of payments crises. Itsymmetry capital inflows appear as a credit will also analyse the contention that theitem. The transactions in the KA generate balance of payments is the main constraint to 17
  23. 23. economic growth. The last section discusses substitution effects in bringing the balance ofthe policy lessons associated with the recent payments to equilibrium.balance of payments experience. Most authors at that point remained prisoners of Say’s Law, and as a result theBalance of Payments Adjustment level of activity was excluded from any roleThe theory of balance of payments in adjusting macroeconomic disequilibria. Itadjustment has gone in full circle, from the was only with the formal development of theautomatic adjustment views of David Hume’s principle of effective demand by John M.specie-flow mechanism, to the Keynesian Keynes that the possibility of having the levelinterventionism of the neoclassical synthesis, of income as the adjusting variable enteredto the revival of hands off views within the the scene. As correctly pointed out by Taylorintertemporal approach. (1990:73), “this [Keynesian] revolution David Hume (1752) developed the price- fundamentally attacked Say’s Law, and hencespecie-flow mechanism not only as an the specie flow mechanism.”interpretation of the BP adjustment process, In Keynes’s work the level of incomebut also as an argument against the works as the adjusting variable betweenmercantilist defence of government savings and investment. In an open economyintervention. According to the price-specie- environment the level of income operates asflow mechanism the BP is self-adjusting. If a the adjusting variable for a trade deficitcountry runs a trade deficit, then there will be (Harrod 1933). That is, if a country runs aan outflow of capital, which will lead to persistent trade deficit, and capital inflows aredeflation in the deficit country, and to lacking, then a reduction in the level ofinflation in the surplus country. As a result of income would lead to a contraction ofthe fall of prices in the deficit country, its imports, and the adjustment of the balance ofexports will become more competitive, thus payments. This came to be known as therestoring the trade balance equilibrium. In absorption approach to the balance ofother words, capital (gold) flows eliminate payments. The absorption approach alsoany trade imbalance. meant that there was a great degree of The balance of payments adjustment is a elasticity pessimism, that is, the idea thatpurely monetary phenomenon, and all the depreciation would have a minor effect inadjustment is done by changes in relative adjusting the balance of payments.prices (one must not that Hume himself Structuralist authors pointed out later thatadmitted short run changes in the level of even exchange rate movements affect theactivity). This was the standard model for balance of payments not through its impactbalance of payments adjustment by the time on price competitiveness, but through itsof the final collapse of the Gold Standard in effect on income distribution and the level ofthe 1930s—and still is in a sense activity. Krugman and Taylor (1978),(Eichengreen 1996). building on the work by Albert Hirschman Hume’s specie-flow was thought for a and Carlos Diaz-Alejandro, show thatworld with fixed exchange rates. In the 1930s depreciation leads to a contractionarythat assumption became considerably less adjustment if the economy has a trade deficitrelevant, and new ideas had to be developed. or if it redistributes income to higher incomeThe elasticities approach was for a while the groups. In the first case, if the volume ofdominant model, and emphasized the role of imports is high and the value increases after devaluation, contraction of output may be the 18
  24. 24. only way to reduce the trade deficit. In the to the balance of payments is that if a countrysecond case, if the redistributive effect of runs a current account deficit in the earlydepreciation increases the income to low periods—for example because it has fiscalspending groups (higher income groups), then deficit and the output level is above thea contraction of output also follows. natural level—then it must run a surplus in The Mundell-Fleming model—a great the future in order to pay the debt that issynthesis of the absorption, elasticities and accumulated in the initial periods (Sachsmonetary approaches to the balance of 1981; Obstfeld and Rogoff 1995). In fact, thepayments developed during the 1950s and intertemporal approach brought about an1960s that started with James Meade’s (1952) analogy between the budget constraint andclassic The Balance of Payments—remained the external constraint that was only implicitfor a long while the dominant view on in previous conventional analysis (Curriebalance of payment adjustment. In this view, 1976).then the adjustment is partially done by Hence, in a world with developedchanges in the relative prices and partially financial markets a country may choose todone by variations in the level of activity. smooth out spending patterns and delay theHowever, to the extent that economists relied adjustment of the balance of payments formore on the concept of a natural rate of several periods. The conventional wisdom isunemployment—associated to some optimal that economies tend to be at the output levellevel of output—it became evident that in the that corresponds to the natural rate oflong run, variations in the level of output unemployment in the long run, and as a resultcannot be central for balance of payments in the long run the adjustment is done byadjustment. variations of relative prices, either a deflation More importantly, in monetarist criticism or a deprecation of the currency. In bothof Keynesian models of balance of payments cases, monetary policy is seen as the mainadjustment noted that the latter analysis did instrument to achieve the balance ofnot take into consideration the accumulation payments equilibrium.of stocks. In other words, Keynesians There are several limitations to thisanalyzed the flows of goods, services and analysis. A crucial problem is the idea of acapital, but not the accumulated stocks of natural level of unemployment, whichdebt in the form of assets that resulted from subtracts any relevance to changes in thebalance of payments disequilibria. The level of activity in the balance of paymentsmonetary approach to the balance of adjustment process. The natural rate ofpayments and the intertemporal approach that unemployment corresponds to the fullfinally came to dominate were designed to employment level. It is worth noticing,solve that problem. In both cases, a central however, that the natural rate has beenpart of the analysis consists on the fact that a conspicuous for its absence in the 1990s.country’s ability to spend more than it earns In the early 1990s in the US mostis limited by a budget constraint. In the macroeconomist agreed that the natural ratemonetary approach the emphasis is on the was around 6 per cent. If unemployment fellcontrol of the domestic money supply stock, below that rate, then the economy wouldwhile the intertemporal approach emphasizes overheat and inflation would follow. Yet, bythe possibility to smooth out spending the mid-1990s unemployment had fallen topatterns over long periods of time. The main around 4 per cent and inflation was nowhereconclusion from the intertemporal approach to be seen. The Federal Reserve Board was 19
  25. 25. praised by the market for not hiking interest behind fear floating is the perception that therates when unemployment rates started balance of payments will not adjust by itself.falling. Some economists argued then that the The recent experience with balance ofnatural rate had fallen to around 4 per cent. payments liberalization is a good illustration In fact, to understand the importance of of this point. Some of the problems of theadjustments in the level of activity one does dominant view become clearer in light of anot need to make a big effort. All balance of discussion of the causes of balance ofpayments crises (e.g. the Latin American debt payments crises.crisis of 1982, the Asian Crisis of 1997, etc.)were followed by severe contractions of the Balance of Payments Criseslevel of activity and increasing levels of The canonical model of balance of paymentsunemployment. Further, as the contraction crises was developed by Krugman (1979),helps to reduce trade imbalances by reducing based on the work of Girton and Hendersonthe level of imports, patterns of trade are also (1976). According to this view the main causeaffected. Usually countries cut the imports of of a balance of payments crisis issuperfluous goods, and maintain imports of overspending. Governments tend to run fiscalintermediary goods essential for production. deficits, which in turn are financed by moneyThese changes are seldom—if ever— emission, leading through the simple Quantitydetermined by changes in relative prices. Theory of Money to inflationary pressures. In sum, a crucial element in the The inflationary pressures imply thatconventional view about balance of payments domestic goods become more expensive,adjustment depends on a proposition that is— leading to current account deficits (twinto say the least—difficult to defend in theory, deficits) and, hence, to pressures forand that has scant evidence in its support. Full depreciation. Depreciation and theemployment or tendencies towards it are not a substitution effects that it provokes adjust thecommon feature of modern economies. So balance of payments, but a new crisis canone could ask what would be the only be avoided by fiscal adjustment.consequences of abandoning that assumption, Several authors extended the conventionaland assuming a more pragmatic story. In particular, it was noted thatmacroeconomic theory for the theory of governments not only had to be fiscallybalance of payments adjustment. responsible, but they had to be perceived to A second and interrelated critique of the be fiscally responsible. In other words,dominant approach is the notion that the credibility is the key to avoid balance ofbalance of payments is self-adjusting, and payments crisis, so creating a reputation forthat led to themselves markets would adjust fiscal responsibility should be the main tasktowards equilibrium. Intervention on the of financial ministers around the world. Inbalance of payments is, however, pervasive, that case, it is not impossible to imagine asince markets have indeed a tendency to lead situation where a country suffers a balance ofto balance of payments crises. Calvo and payments crisis even though it pursuesReinhart (2000) have noted that even market-friendly policies. Obstfeld (1986)countries that claim to pursue flexible shows, using a model that is in essence theexchange rate policies tend to intervene in same as the one developed by Krugman, thatforeign exchange markets, showing signs of countries with pegged exchange rates arewhat they refer to as fear floating. The reason particularly vulnerable even if they pursue responsible fiscal and monetary policies. 20

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