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countries become what they make

César Hidalgo argues, “…in the long run, the income of countries is determined by the variety and sophistication of the products they make, rather than by the traded value of their exports.” In The Dynamics of Economic Complexity and the Product Space over a 42 year period, Hidalgo applies network science techniques to 42 years of trade data in order to better understand the impact of a country’s product space (e.g., oil, pears, chemical, cars) on future income growth and movement into new product markets. Read the rest of this entry »

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Filed under: Economic Policy

sandel’s ‘moral’ tribalism

I greatly enjoyed the first two-thirds of Michael Sandel’s new book, Justice: A Reader, which only made the final third more disappointing. Sandel begins his book with a long and fruitful discussion of philosophical thought, ranging from Rousseau to Nozick to Rawls, with compelling thought experiments and concise explanations of the different schools of thought. In the end, Sandel argues that each school falls short, in part due to neglecting the moral legitimacy of communal bonds, such as family, ethnicity, and nation, which, he argues, are not contractual, voluntary decisions made by the individual, but inescapable moral obligations that do not depend on individual consent. Read the rest of this entry »

Filed under: Philosophy

livestock versus gold on $2 a day

Last March, the Monitor Group published Emerging Markets, Emerging Models, an analysis of the opportunities and challenges to apply market-based models to better serve the world’s poor as suppliers and customers. I have discussed the failure of supply-side aid economics in the past, and the Monitor Group’s findings illustrate the danger of assuming that your outside opinion of a low-income group’s needs matches their wants.

“We want gold on credit. Everyone in our village does,” Monitor Focus Group, Andhra Pradesh, India Read the rest of this entry »

Filed under: World

development is local

The World Bank is slowly publishing a series of books on the subject of “Moving Out of Poverty;” while the subject isn’t novel, the incredibly rich data set that underpins the series certainly is. The World Bank study included 60,000 interviews in 15 countries, with the purpose of explaining how and why households move out (and in to) poverty. I am working through the online samples while waiting for the price to come down on “Moving Out of Poverty, Volume 2: Success from the Bottom Up,” by Deepa Narayan, Lant Pritchett, and Soumya Kapoor. For a rundown of the book, check out Duncan Green’s post from last year.

The breadth and depth of the data set powers some startling factoids. Read the rest of this entry »

Filed under: General Welfare, World