What Is Development?


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What Is Development?

  1. 1. What is development? <br />Anthony Scaletta November 3, 2009<br />
  2. 2. Development theory and practice timeline <br />Post WWII- The Beginning of the Development Era<br />WWII aftermath created a level of global consciousness that had not previously existed<br />Formation of UN: An IGO created to promote peace & facilitate global stability <br />Universal Deceleration of Human Rights (UNDHR) December 1948<br />Recognizes the “inherent dignity and equal and inalienable rights of all members of the human family” and doing so forms the foundation of freedom, justice, and peace in the world <br />Declaring “Human Rights” laid the groundwork for the idea that development should promote the rights of the individual <br />Modernization Theory (1950s-1960s)<br />Suggested that LDC’s needed to modernize as much as possible and become more similar to MDCs<br />Focused on economic output as primary indicator of development<br />“Experts” telling LDCs what to do: Led to proliferation of monocrop specialization<br />Cold War- Bipolarization of world impeded development practice <br />2<br />
  3. 3. Development theory and practice timeline <br />Dependency Theory (1970s- South America) <br />Critique of Modernization Theory – Belief that it created uneven economic growth<br />Suggests Disassociation from global market: To break the cycle of exporting raw goods and importing finished goods <br />Largely unsuccessful<br />Basic Needs Theory (1970s) <br />Response to Dependency Theory<br />1st time to look at indicators other than economic growth<br />Promoted development of the poor by addressing “Basic Needs” such as hunger and literacy <br />3<br />
  4. 4. Development theory and practice timeline <br />Neo-Liberalism /Washington Consensus (1980s)<br />Viewed US & UK models of capitalism & democracy as best to follow<br />Promoted Individual Freedoms by calling for less government in an attempt to increase the market through a global push for more free trade<br />Obstacle: Lack of universal business practices<br />Outcome: Massive Explosion of NGOs <br />Today: 1000s founded every month<br />Stepping in and providing rights that have traditionally been guaranteed by the state<br />(e.g.) Access to Water or Health Care <br />Wiggle Room<br />Popular: Seen as a solution, but it is very difficult to measure NGO’s effectiveness compared to that of Gov’t interactions <br />UN’s Human Development Index (HDI) (1990s) <br />No single measure of development<br />Uses Life Expectancy, Literacy, Per Capita Income, & Infant Mortality Rate to better understand global development<br />Still used today <br />4<br />
  5. 5. Development theory and practice timeline <br />Development as Freedom (1990s)<br />Economist Amartya Sen suggests that we take a more holistic view of development<br />People & Communities have options: They should be able to access these options in the context of a world that is sensitive to cultural differences <br />Post-Modernism (1990s)<br />Skeptical PM: There are no universal truths. All truths are culturally and temporally bound- No universal development Model <br />Affirmative PM: Some universal truths but most are specific and change over time<br />* Shift from State-Focused Development Individual-Focused Development <br />5<br />
  6. 6. Development theory and practice timeline <br />Contemporary Development Theory<br />Development as Human Rights<br />Philosophy that each person must hold their individual human rights in order for development to occur <br /> Human Security<br />An emerging paradigm for understanding global vulnerabilities in relation to security<br />A local to regional to global approach looking at human security as key to stability <br />7 Levels of Security: Economic, Food, Heath, Environmental, Personal, Community, & Political <br />Former UN Secretary General Kofi Annan: “There will be no development without security, and no security without development.” <br />* People -Centered Approach <br /><ul><li>From State-Focused Development to Individual-Focused Development </li></ul>Development is the process of ensuring that each individual has full access to their human rights<br />Sustainability is Key! <br />6<br />
  7. 7. Jeffrey Sachs<br />Harvard Trained Economist <br />Director of The Earth Institute @ Columbia University<br />The End of Poverty<br />Blueprint for ending all extreme poverty by 2015<br />Top-Down Approach: Key to ending poverty is the use of foreign aid from the world’s affluent countries <br />“Big Five” Development Interventions<br />Agricultural Inputs, Investments in Basic Health Care, Investments in Education, Investments in Infrastructure, & Access to Safe Drinking Water and Sanitation <br />“Clinical Economics” – newly proposed method for development economics <br />It is akin to clinical medicine = Good economic practices must be rooted in a sound, clinical medicine-style approach<br />Use of “differential diagnosis” to determine “treatment regimen” <br />Use of a Seven-Part Check list <br />Key assessment: Physical Geography as a Handicap <br />Sub-Saharan Africa: Physical ecology creates a prime environment for disease and drought<br />Geographic Isolation: Lack of infrastructure (Africa has 15 landlocked countries ) <br />Forms basis for the Millennium Development Goals (MDGs)<br />7<br />
  8. 8. The UN’s Millennium Development Goals (MDGs)<br />189 world leaders signed the Millennium Declaration @ 2000 UN Millennium Summit <br />Intention: “Free our fellow men, women and children from the abject and dehumanizing conditions of extreme poverty.” <br />Global compact by all the world’s countries and all the world’s leading development institutions to meet the needs of the world’s poor <br />Poorer countries pledged to improve policies and governance and increase accountability to their own citizens<br />Wealthy countries pledged to provide the resources<br />Time-bound Goals are Rigorously monitored through use of MDG National Reports<br />Showcase national progress on each of the MDGs<br />Over 140 Countries <br />Source: http://mbaswithoutborders.org/files/2008/09/mdg_goals.gif<br />
  9. 9. William Easterly <br />Professor of Economics at New York University<br />The Ideology of Development & The Poor Man’s Burden <br />Critical of State-led development and Foreign Aid <br />Grassroots Approach – Individualism & Decentralized Markets<br />Developmentalism: Development as an Ideology is Dangerous! <br />Problematic- Suggests there is only one correct answer, a general theory that can be applied universally<br />“One Correct Answer” = Free markets = IMF & World Bank telling countries what to do<br />International Aid Bureaucracy: The “Self-appointed Priesthood of Development”<br />IMF and World Bank’s SAPs of the 1980s (e.g.) These laid the groundwork for Evo Morales to come into power in Bolivia <br />This thinking favors collective goals over the aspirations of individuals<br />(e.g.) Millennium Development Goals<br />Opposite of ideology = Freedom = Let people be free to find their own solutions <br />The ability of societies to be unchained from foreign control <br />The only “answer” to poverty reduction is freedom from being told the answer<br />Let the individual learn from their mistakes : “History proves just how much good can come from individuals who both bear the costs and reap the benefits of their own choices when they are free to make them.” <br />Americans in 1776 had the same income level as the average African today,<br />The US wasn’t being “structurally adjusted and meddled with while it was developing <br />Individualism & decentralized markets produced the Automobile <br />9<br />
  10. 10. William Easterly <br />The “4 Unfortunate Lasting Consequences” of Early Development Practice<br />Belief that granting extensive powers to the state is the surest path to progress<br />Loss of faith in spontaneous bottom-up economic development preferring instead development “consciously achieved through state planning”<br />The propagation of an economic philosophy that stresses the volume of investment over the efficiency of using those resources<br />A widespread skepticism about using international trade as an engine of growth<br />The 4 Ways to Avoid the Top-Down Way of Approaching Economic Development <br />Avoid the trap of protectionism<br />Keep the market open by keeping the state-led financial regulations to a minimum<br />Slash away at the enormous red tape that is left over from previous harebrained attempts at state direction of the economy<br />Don’t look to economists to create “development strategies,” and don’t back up such experts with external coercion like IMF and World Bank conditions on loans.<br />History proves that imposing a rigid statist development ideology on the world’s poor has failed miserably<br />The Easterly Solution: Pragmatic use of time-tested economic ideas by individuals, firms, governments, and societies as they find their own success <br />“Revolution from Below” <br />(e.g.) Chung Ju-yung : The son of North Korean peasant farmers that built the Hyundai car company from the ground up <br />Easterly: “It is the ‘Chungs’ of the world that will end poverty.” <br />10<br />
  11. 11. Personal Experiences w/ Development in East Africa<br />11<br />Family Alliance for Development and Cooperation (FADECO) <br /><ul><li>Joseph Sekiku, Founder & Director</li></ul> Ashoka Fellows in Africa Award: “Driver of social change” <br /><ul><li>Grassroots Sustainable Development: Small projects w/ Big Impacts
  12. 12. Working to alleviate poverty and improve standards of living in the Karagwe District for all people</li></ul>Radio FADECO<br />Main Objective: Support the implementation of the national poverty eradication strategies<br />DEVELOPMENT MOUTH PIECE<br />To be used by the development community in Karagwe to effect sustainable rural socio-economic development <br />Access to information is one of the limiting factors in implementing development programs<br />Reaches 4 Million People <br />The Eden Centre for Appropriate Technologies<br /><ul><li>Focus Areas: Agricultural Extension & Participatory Technology Development with rural farmers
  13. 13. Promotes renewable energy technologies</li></ul>Solar Fruit Drying<br />Wind & Solar<br /><ul><li>Objective: Develop, demonstrate and transfer new appropriate technologies and </li></ul> skills in rural Tanzania<br /><ul><li>Practical Education
  14. 14. Empowerment through Information & Education</li></ul>"Give a Man a Fish, Feed Him For a Day. Teach a Man to Fish, Feed Him For a Lifetime.” (Lao Tzu)<br />
  15. 15. Personal Experiences w/ Development in East Africa<br />WOMEN EMANCIPATION AND DEVELOPMENT AGENCY (WOMEDA)<br />Human Rights and Sustainable Development based Grassroots NGO working toward establishing Equality in the Region <br />Promotes the status of marginalized groups by creating & strengthening Equal Opportunities for Women, Men, & Children <br />Provider of: <br /> Socioeconomic and Legal Counseling to Women<br />Community Education<br />Child Protection<br /> Bedding, School Supplies & Uniforms <br /> 20 Miles = The Average Distance Walked to Obtain Services<br />Rain Water Harvesting Systems Project<br /> Identify families affected by HIV/AIDS to lessen burden <br />Goal: Extending Lives through ensuring availability of one of mankind’s most basic resources, Water<br />Sustainable Solution <br />Empowerment <br />Lack of Capital = Poverty Trap <br />12<br />
  16. 16. Microfinance: A piece of the puzzle <br />Definition: Supply of small loans, small savings, and other basic financial services to the poor<br />Addresses a Market Failure: Formal financial institutions were designed to help those who already have financial assets <br />Does Not require definitive assets or collateral that the bank can seize<br />Gives Credit to those who otherwise couldn’t get it <br />Community-Based: Terms of payback are negotiated by the community members <br />Money is distributed by Savings and Credit Cooperatives or Money Sharing Groups: Owned and Operated by the community members/villagers <br />Group Lending: Held accountable by neighbors<br /> "Peer pressure" from other members of the group helps to ensure that the loan is repaid<br />Currently Very Popular: Seen as a panacea in for development woes<br />Blend of Sachs and Easterly <br />Criticisms<br />Created a hyper-pluralization of small businesses in communities: How many fruit stands can you have? <br />Some Microlending Organizations don’t require a business plan and the money gets misused<br />Doesn’t reach the poorest of the poor<br />UN Capital Development Fund’s Comprehensive Impact Studies on Microfinance<br />Helps very poor households meet basic needs and protect against risks <br />Associated with improvements in household economic welfare and enterprise stability and growth<br />By supporting women's economic participation, microfinance helps to empower women, thus promoting gender-equity and improving household well-being<br />Development Economics Studies have shown: Women are much better spenders and they invest the money in their family and their home<br />Women: Typically in charge of the cooperative and distribution of funds <br />(e.g.) KADERAS – Governing Board has a minimum requirement that 30% of its members are Female <br />13<br />"The power of putting capital in the hands of poor people enables them to create their own wealth and invest in their children." - Maria Otero, president of ACCION International<br />
  17. 17. Dr. Muhammad Yunus<br />Father of Modern Microfinance <br />2006 Nobel Peace Prize Winner<br />Grameen Bank<br />One of the 1st major microcredit institutions<br />Founded in 1974 in Bangladesh, while Yunus was studying the lives of poor entrepreneurs during a famine <br />He began by loaning to groups of women, and his program soon proved that small loans could not only quickly improve lives but were paid back with interest and on time <br />Since 1974<br />The Grameen Bank has loaned $5.7 Billion<br />$5.1 billion of that has been repaid <br />Recovery Rate = ~ 98.9 % <br />It has made more than 950,000 loans and has 6.7 million members, <br />~ 96 % are Women<br />Norwegian Nobel Committee:<br />“Ending poverty in the world cannot be realized by means of microcredit alone. But Muhammad Yunus and Grameen Bank have shown that microcredit must play a major part." <br />World Bank <br />Estimates: + 7,000 Microfinance Institutions in operation all over the world<br />14<br />
  18. 18. San Francisco-based, one-of-a-kind microlending organization <br />Has developed a global lending platform using the Web to connect individual lenders w/ individual borrowers in developing countries <br />Kiva’s Mission <br />To connect people through lending for the sake of alleviating poverty <br />Providing access to a brand new source of debt capital <br />Loans of as little as $25 made by ordinary individuals through its Web site @ kiva.org<br />15<br />http://www.pbs.org/frontlineworld/stories/uganda601/video_index.html<br />
  19. 19. Conclusions<br />Defining Development is difficult because it is a complex issue<br />Hopefully this presentation has helped to shed some light on the issue <br />Development can most accurately be defined as:<br /> The process of ensuring that each individual has full access to their human rights <br />There is no single solution<br />Large International Aid Organizations have their limitations: Bureaucracy<br />Many NGOs doing good work<br />Empowerment and Education are better than handouts <br />Grassroots-based initiatives have proven effective<br />Sustainability is the key to future development practice <br />Essay Questions<br />If development is a process of ensuring that each individual has full access to their human rights, how have the various theories, authors, and organizations that we have discussed contributed to or hindered development? <br />Discuss microfinance and whether or not it is a solution for sustainable development in developing countries? <br />16<br />