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Developmental Studies - Coggle Diagram
Developmental Studies
Course Overview
Dev Studies is Cross Discipline (Not as Quantititative as Econ) - have the basic constitutent of different disciplines but come together for a task
Cross (Come together to work from different disciplines) / Inter (Boundaries break down) / Trans (Forms a new discipline through combination) / Multi (Pluralist views accross disciplines)-disciplinary
Core Ideas and Concepts of Development
Economic Development
Human Development
Political Economy (Marxian)
Participation
Degrowth/Post Development
Not Econ/Sociology/Environmental Studies/Geography but draws from the disciplines.
Econ gives a scientific view but does not look at power relations, Sociology/PolSci does look at it and consider that and by drawing from both we can have a more holistic view
Tries to integrate but often draws from one over the other. Positionality: the background of the person can influence the persons approach. IMPORTANT TO RECOGNIZE. Beyond just rational actors, recognizing the position of the source.
Several well developed journals. Post colonial plans to imporve the economy of third-world "underdeveloped" countries (1950s). Different tradeoffs, choices. Pluralistic approaches: Industrialization, Agriculture development. Degrees in Development studies have been established over the years..
Going from Growth (Econ) to Criticism (Marxian, Human Development) to Reversal (Degrowth)
What do we mean by Development and what matters?
Case I. Poverty Line Estimates
Government Determines. In the recent past, there has been no official pronouncement in the last few years. What influences the determination. Its a crude technical exercise.
Newspaper Reports:
2011: Airtel planning the 70 cr pay package for CEO
2011: Rs 32 a day poverty line is not ridiculous
Is this right? Inequality evident! But it it okay to have such inequality? much more than need!
Huge Inequities in income. 1980 onwards increase in inequality. 22% share by 1% in 2010
Case 2: Water use in Agriculture
People should be provided adequate water. People often get underserved and water access is skewed in social groups.
Arkavatha sub-basis LCPD (Lt/capita/day) levels accross social group (Marginalised (No land/Women led/SC ST OBC) vs Non-Marginalised) No difference in only domestic water but slight skew in water including livestock.
More GW is extracted and more borewells fail. No dependence on surface water. Adequate and Equitable BUT NOT SUSTAINABLE
Positionality in Perspectives: Many different value positions. Conservationists vs Village Development. When we pose our research question we have to be transparent about our positionality with which we enter the frame.
Case 3: Water Pollution
Bengaluru: a few years ago proposal by consultants and authorities to recycle and reusing water. Poluted water was used by farmers downstream for nutrient rich water. (Positive Externality) Reyse leads to reduction of nutrient
No easy answers. Resilience of one affects the growth of another
Factors that matter (Normative Concerns). DS is Normative enterprise
Equity
Efficiency
Fairness
Justice
Sustainability
Development Studies: About Income Growth, Prescriptive and Predictive, About Numbers (Econ), About Human Well-Being, Normative and Critical, About words. (Sociology Anthropology)
DS is a 'crisis-discipline' problem driven, be a part of the solution (understand problems and inform policies and actions) Often the solution step is left out because it needs political power. As an academic enterprise the first two are used
Readings
Tribe Nixson Sumner
Factors behind Developmental study
Decolonisation
Developmental Economics
after 1970s crises a multidisciplinary
approach was formed
1949 Truman Declaration / Marshall Plan style
of thinking in1950s and 1960s. (External Push)
as newly independent states sought prescriptions for an ‘economic catch-up’ with industrialised nations (Internal Push)
But economics seen as "hard" science.
prevalent "economics-aversion" eg. no inequality analysis in poverty studies (no Gini Coeff/Lorentz curve)
Developmental study as cross-disciplinary
Beyond just social science
Needs input from natural and physical science besides politics, economics, history, sociology and antropology
Economics [Mandeville, Smith, Quesnay]
v.
Non-Economist [Marx, Malthus, Schumpeter]
Economics accused of Imperialist Tendencies
Multiple technical controversies
Clashes of multiple ideologies (weltanschauung)
Disagreement on the methods to study
But nonetheless, economic perspective is essential
Conflict in context of analysis and policy prescription for developing countries. Economist (too rigourous and focus on quantitative) v Non Economists (Not rigourous enough)
Todaro Smith
the process in developing countries cannot be analyzed realistically without also considering the role of economically developed nation in directly or indirectly promoting or retarding that development.
Types of Economics
Traditional economics: An approach to economics that emphasizes utility, profit maximization, market efficiency, and determination of equilibrium.
Political economy: The attempt to merge economic analysis with practical politics to view economic activity in its political context.
Development economics: The study of how economies are transformed from stagnation to growth and from low-income to high-income status, and overcome problems of absolute poverty.
Greatest Scope of All
Because of the heterogeneity of the developing world and the complexity of the development process, development economics must be eclectic, attempting to combine relevant concepts and theories from traditional economic analysis with new models and broader multidisciplinary approaches derived from studying the historical and contemporary development experience of Africa, Asia, and Latin America.
Sumner and Tribe
Development as 3 overlapping processes
‘Development’ as a long-term process of structural societal transformation (1950-1960s onwards)
it is historical and it has a long-term outlook.
shift from a rural or agriculture-based society to an urban or industrial-based society
involves changes to socio-economic structures – including ownership, the organization of production, technology, the institutional structure and laws.
The process does not relate to any particular set of objectives and so is not necessarily prescriptive. Equally, it does not base its analysis on any expectations that all societies will follow approximately the same development process.
strong resonance with the ‘meta-narratives’ of Cold War era
‘Development’ as a short- to medium-term outcome of desirable targets
‘a vision or measure of progressive change’ and 'preformance assessment'
indices that can be measured and compared with targets
focused on the outcomes of change so that it has a relatively short-term outlook (somewhat ahistorical)
a paternalistic assumption as to what is good for people’s well-being based on a set of universal values and characteristics; is an issue over whose objectives and values are expressed
depoliticize development by taking a technocratic approach
neglect of other important and inter-related dimensions of development and study only poverty
‘Development’ as a dominant ‘discourse’ of Western modernity
based on the view that development has consisted of ‘bad’ change and ‘bad’ outcomes through the imposition of Western ethnocentric notions of development upon the Third World.
'post-modern' 'post-colonial' ‘post-structuralist’ studies of development
Triggered post the 1949 Truman Declaration to bring about developement in "under-developed countries"
a frontal onslaught onto the ‘development industry’
development (and poverty) are social constructs that do not exist in an objective sense outside of the discourse (a body of ideas, concepts and theory) and that one can only ‘know’ reality through discourse.
examine how people use particular types of language and imagery to represent themselves and others in particular ways. The focus is on how these images are underlain by, and reproduced through, power relations, and on what their social, political and economic effects are – rather than whether or not they are ‘true’.
The power to define reality is a crucial aspect of power and one of the major means by which certain groups are silenced and suppressed.
Critiques of the post-modern conceptualization of development typically focus on its perceived nihilism and further suffers from ‘the performative contradiction' (Foucalt) : if we can only know reality through discourse then why should we believe any one account more than any other – each account might be
equally ‘socially constructed’.
The post-modernist view would suggest that those who construct the concept or the ‘discourse’ have in mind this inherent element of inferiority-superiority. :
Deneulin Shahani
Normative nature of Development
Development
Development processes use and manage natural resources to satisfy human needs and improve people’s quality of life.
‘development’ as a multi-dimensional and multi-sectoral process
ideas about what development should be, matter. Different ways of understanding what development should improve lead to different policies and consequences.
The Normative nature is the similarity between all approaches
normative or ethical – based on value judgements – in that they clarify how groups ought to behave in order to create improvements.
learning from past experiences and analysing existing data - positive approach to development, and relates to empirical studies, data analysis, hypothesis testing and other kinds of description and analysis.
policy makers need to be able to predict how a situation
could change in certain ways.
normative, positive and predictive approaches are all interconnected
one needs a normative framework to
define what poverty is – to choose its variables and measures.
There are many ways in which normative frameworks affect policy decisions and outcomes.
they shape the data that we collect
they influence our analysis
they give certain topics greater or less political salience
they feed or hinder social movements
they may motivate professionals for moral or ethical reasons
they can be more or less philosophically credible.
common core issues
of uncertainty
of difficulties in prediction
of evaluating trade-offs
of identifying interconnections among variables and causal links.
deep interconnection between different types of policies. (agriculture affects economic, affects gender policies and so on)
Case Studies
Ecological Crisis at Tai Lake river basin (China)
Pollution->eutrophication->water undrinkable
Total pollution-related losses accounted for more than 3 per cent
of aggregate local GDP.
Not investing in tackling pollution now will result in greater economic losses in the future while the non-economic costs of pollution, such as loss of biodiversity and natural beauty, remain incalculable.
Mining Industries in Peru
1990s: a structural adjustment process aimed at liberalizing its economy, leading to a boom in the mining sector.liberalization reforms greatly strengthened the position of the mining sector in the economy.
mining has been very disruptive for the social and natural environment. Mercury PosioningWidespread water contamination caused by inadequate mine waste management, outright displacement.and forced relocation for mining developent
arrival of outsiders frequently generates tension within communities and threatens traditional practices.
The impact of mining dramatically limits the ability of peasant communities, restricting their livelihood opportunities.
While economic gains would clearly benefit some, there were obvious trade-offs.
local people may have a different normative framework that the mining industrialists
Save Mabira Forest in Uganda
12 April 2007: many Ugandans turned out in the streets of Kampala to protest against a government plan to sell 7000 hectares of forest land to a sugar company
protest between demonstrators, who wanted to preserve the natural integrity of the forest, and the government, who hoped to encourage productive investment in the country,
Tribes also joined in a huge social movement at the end of which the project was scrapped
Here, the environment was inextricably linked to notions of development and well-being, which included considerations about health, food, history, religion and their overall relationship with nature.
The stories highlight that each state of affairs is viewed differently by different groups and individuals. We can see here two sets of questions being asked by different groups, each relying on certain normative assumptions about what matters and what policies should be pursued.
The stories clearly illustrate that what is considered to be ‘development’, and what is seen as a policy to improve people’s lives, is inextricably linked with values about what matters. Whether development aims to improve economic growth or to advance human rights, human agency or human flourishing, the implications are both practical and far-reaching.
Heathrow Airport Expansion
Airport expansion was a boost to the flight industry but had a negative impact on people living nearby.
Increased noise pollution levels were not taken into consideration when deciding the expansion. (Negative Externalities)
The economic lives of the poor (Banerjee and Duflo, 2007)
Methods
Collects data from multiple dataset and puts it together. A wide range of surveys and tries to compare. Lot of interesting perception
Poverty line (An artifical construct)
Extremely poor ($1 PPP)
Poor ($2 PPP)
Same value of poverty line across years
All surveys are somewhat comparable (not ideal but a good attempt)
NOT incluciing temporary poverty, only consistently poor
Keeping the same parity? or adjusting for inflation? Here they fix it for a year.
Sections
How they earn money?
Lack of specialization: bet hedging rather than dedicated labor. Women choose to sell dosas in morning and do something else during the day.
How they spend money?
Calorific use related. Not maximizing calorie intake but taste and other expense. Income elasticity of calorie demand (prefer tasty calories)
Differential cultural spending on festivals and other entertainment
Dependence on addictions
Markets and contexts of economic lives
Reported health and happiness are not very low. Mortality level, more people are aware the more they report. report stress but not unhappiness.
Thinking about the future, high discount rate, dont care much about the future
Purely on the basis of general efficiency we expect something: Specialization, Choosing optimal products to consume but there are a lot of psychological and social factors that get ignored. This paper attempts to consolidate the deviations observed
Three questions
Efficiency: Why so little specialization?
Diversify source of income: Bet hedging as the strategy for laborers. No insurance other than social capital. so that try to not put all eggs in the same boxes.
Calorific Poverty: Why not eat more out of marginal rupee?
Inadequate planning. Keeping up with the Joneses (the neighbours).
Time Preference: Why poor people dont save more
Macro view doesnt directly translate. Tradeoff between right now or save.This is the time preference. At micro level not as simple as putting in bank. Low propensity to save. Also hard to save.
Resnick and Wolff
Clear Positionality: Explicitly state what principle guides their analysis
What is poltical economy?
Marxian not the only political economic approach.
Looking at choices and economics while taking into account the power relations
Distribution of Resources and Power
Confusing Label
Political Economy of Policies: How politics interferes with choices and decision making process. Political variables affect decision making.
Pre-Adam Smith: Economics = Political Economy
Marxian economics is not treated as economics
Political economy: Analysis of Power Relations
Broad social science: Micro level power relation (laborers in villages)
Marxian political economy: Grand Meta-narrative on power and social change has to do with systemic change (historical wrt system, key varables and find the grand narrative, focus on labor and caital as the main factors of productions)
Criticism of both Marxian and Econonic Development: Focus on production instead of environment and ecology (Political Ecology and Degrowth)
Political ecology: Capital exploits environment via accumulation
What determines value?
Use-value: Material cost and usefulness of the object
Exchange-value: Conversion rate in the market (Determined by S&D in the Economic Framework, Long Term Socially necessary labor time)
Utility value: Usefulness is not enough Diamond-water paradox. Scarcity needs to be taken to account. Marginal utility of water is less than Marginal Utility of Diamond.
Labor Theory of Value
Value is labor and surplus value is surplus labor.
Capital is dead labour but labor nonetheless.
Use value-> exchange value via labor
Value = Dead Labor (Capital) + Living Labour
Cycles occurs because:
Investment in an increasing function of the rate of profit
the rate of profit is a decreasing function of wage
Labor is compromisable, Investment into capital is not until there is a glut in the market due to reducing purchasing power of labor
Reserve army of the capitalist, forced unemployment
Marxian framework still very much a direst extension of classical economics like schumeter.
Rigor and bias in DS
Sumner and Tribe 2004. Logical thread that binds the research question from start to finish. One stage informs the next. Objective bias acceptable but subjectivity is not. Techniques are known to have strength as weakness. Mixing methods to cover weaknesses and be a Reflective practitioner. transparent peer review and defense
Explaining Crisis Management
Keynesian: State (regulate), Classical: Market (independent, deregulated)
Marxian: Solution is different. Political and ethical problem. Surplus value is the root of evil. if no surplus value, everyone shares the risk and responsibility in the system and a common pool of resources. Capitalist not needed as a middleman.
Market: Say's law. Creative Destruction.
Keynesian: State policy
Marxian: Change capitalism altogether.
1980 recession in india (led to deregulation), 1937-8 US recession, 2008 US recession (state ), 2020 recession (state stimulus)
Evidence from the paper
Research question/objective?
Cycles keep happening. State and market cycles. The only way to stop it is to let go of capitalism
Framework?
Analysis in a class lens. Looking at indices. Causality is not explained.
Mrxian econ seen as less
Escobar 1999
Post Development
Post what?
If not this then what?
A critique of what is happeneing, and is somewhat of a political project but not a full action plan. They want us to evolve out ways forward. Taking into account out own culture. Same as Amartya Sen who tried not to assign indices that span the global
Dreams of a world beyond and outside development
Post why?
Invented by west
Technocratic, its a speialist effort not the people. Need experts to control the direction of the development. Ignores the local capabilities
Is linear and no space for alternate knowledges or pluralism,
Power matters, Foucalt.
Post How
History
Ashish Kothri 'Pluriverse': A radical pluralism; Vikalp Sangam
Cultural and social change (locla food , revival of traditions) Eg. Food Sovereignity: food security + local importnace
Political change (grassroots initiatives, environmental movement, resistance). Latin america the movement from extractive economy to post extractive change
Eonomic Change (post growth, degrowth) - diverges from marxian political economy
Development alternatives (traditional NGOs and Civil Society; work within the system) vs Alternatives to Development (Alternatives that challenge development at its root.) Movements NOT projects
Degrowth (the Actionable side
of post development)
Primarily european: environmental economics (1970s) Strong focus on valuation fo ecological reources. Dont look at the limits.
Led to an offshoot ecological economics no comfortale with the optimization idea and started with the other end of teh circulal flow and start at energy use and consumption (leads to limits of usage and waste) This also prough into play the more physical aspects of nature into economy.
Economy + Activist origin. (France to Italy and Spain) with the turning point at Paris Conference 2008.
Ecological economis concern with: decoupling from the enviromnent (cleaner more environment friendly goals; but within the current economic system) just reduce the metabolism of energy ad raw materials
Degrowth: a society with a different structure of production and consumption by downscaling consumption creating a transition beyond captilaism built upon existing alternatives creting open and plural politics. Nature of South vs North (North reduces consumption to allow south to live well)
Global limits (decoupling [efficiency->sufficiency]/green growth, full reserve banking (government needs to be restuctured; Bank reduced to just a reserve not a economic multiplier), no extrative industries) ; local action; gram swaraj, traditional and local food, minimalism
Covid and Degrowth: Reduced pollution by lockdown. Rising inequality (the migrants journey back home; and affluents overusing resources)
Hickels Checklist
1) is it part of a coherent politcy ot reduce ecological impact?
2) Does it target ecologically destructive and socially less necessary production?
3) Does it introduce policies to prevent mass unemployment.
4) does it come along with policies to reduce inequality and share nation income more fairly?
5) is there investment in universal public services to ensure health, educationa and access to needed goods.
6) is it a shift towards community common and care
7) is it part of a plan to rapid transition to renewableenergy restore soils ansd biodiverity and reverse ecological harm
Criticism
Branko Milan: for the north south equality: Global GDP need to rise 2-3 times (implies harm ot environment or reduce 90% of the WENAO population
Policially infeasible
Muradian: very euroentric appraoach once again the north deciding for the south and post colonial people
Intellectual Tradition -
Social Constructionism
Step into their shoes and look from their perspective and knowledge. Everyone sees the world in with their own constructions
Preference for Bayesian statistics.
Insipired by the left but not exclusively (loss of radicality)
Acumulation-> Under/Overproduction -> Radical Restructure-> New more sustainable socio-ecological economy
Escobar's Analysis
Economics as the modorn framework of developement
An attempt to create a post-structuralist antropological theory of developement
Uses: Speeches, Development plans. Studies and deconstructs them in the light of the cultural background.
There is not real relevance to the "third world" terminology beyond political and as escobar argues that there is a poverty/development connotation.
First world has already decided that what the "third world" wants or needs. Ignoring the fact they they have their own knowledge that may not be formal but the knowledge exists
Development is teleological: the discourse and narrative serve to lift up the native to modern
Power Relation (Institutions)-> Representation (Discourses) -> Enframing (Imaginaries and Identities) -> Deployment (Incorporation, Professionalization, Institutionalization) -> Social Construction of Reality
Perspectives
Course Perspectives
Economics Perspective
(Efficiency as the Normative Premise)
Dev as growth of income. Focus on monetary growth. Stock Market, GDP
Mostly based on Neoclassical Economics (focus on free market) and developmental economics (blindly applies Neoclassical Perspectives)
Utility Maximization is a key framework
Eg. BPL (Poverty Line), GDP growth by World Bank, NITI Aayog, Academia
Maximise at MRT=MRS for say different good production function and indifference curve/isoprofit curve in the world market
Do not consider equitability
Human Development Perspective
(Efficiency and Fairness)
Extension of Economics and political philosophy
Beyond normative efficiency perspective, value the human nature and fairness
Capabilities approach (Sen and Nussbaum)
HDI (Human Development Index), MPI (Multidimensional Poverty Index) used by UNDP, NGOs, Academica
Critical Perspective
Draws from the idea of Power and discourse analysis
Political Economy
(Marxian Perspective; Equity above all)
Development is based on Class Struggle
A very empirical and statistical and argue about historical data for analysis, objective and technical
Draws from classical market economics and criticises it
Extensed to environmental studies political ecology and degrowth
Used by Academia and Activists, Political influence on policy through communist/socialist parties
Participatory Development
Participatory devopment originated in 1970sto 80s with proliferation of NGOs
Attempt to involve tribals in the decision making (Protect forest or allow tribals to develop)
Push to work with communities and focus on the micro level
Ecology+Wildlife conservation+NGO+Anthropologist
Post Development
Thrusting of ideas on other people (not mainstream but critical)
Provocative idea and rejects the mainstream notions but people are critical becuase it lacks practical solutions. Activist and academia driven
West to east prescription of development. Evidence is imporant as long as the positionality is clear its good science.
Degrowth is a part of this perspective
Economics is quantitative but others are more Quaitative and Critical
Actors in Development
State, Market, Civil Society
In fact in history its either the govt playing a role or corporates playing a role. Civil society has been present but in an organised instiutions its was only after 1980s.
Some correlative evidence for market influence in development leading to rising inequality when compared to state led development.
Sumner Tribe (Three perspectives)
Process of Structural transformation
The underlying structure of the system. Agrarian (subordinate) to industrialised (developved).
Transformation to different social forms: slavery-> feudalism->capitalism
Process of achieving certain goals
Increasing Literacy, Decrease Poverty Targets
Achieving MDGs, SDGs
Process of Dominant Discourse (from west to East)
From ANtrhopology, something what was constructed in the west and a developement as a tool was forced upon the third world countries. Historical discourses put into context
Deveopment as a powerful discourse. Who holds the power is the key element in the analysis. Eg. Rush hour in UK people ignoring each other, value differences, different systems of value but west ideas forced on developing countries as "development"
A review of Economic Principles
Utility as the quantifier. Efficiency as the normative goal. Study of scarcity and choice. Limited Resources
Micro-Economics
Small scale behavior.
Household economics, Firm economics, market economics
Collect data and analyse under selected perspective/framework
Macro-Economics
At the level of a nation. Large scale economics
Is there really a difference in micro/marco? -a recent debate
Mankiw 's six principle we care about
People face trade off (Between Goods and services). Should a state Invest in poor people or rich people. Invest in short term return or long term return.
Cost includes the cost of missing the alternative. Opportunity cost = value of the next best alternative
Rational people think at the 'margin'. Rational actors think at the marginal condition.
Markets are the best way to orgaise economic activity. Many debates about it. Should states interfere.
Governments can sometimes improve market outcomes by solving externalities and manage market failures.
A countries standard of living depends on its ability to produce coods and services. Productivity/growth. HWB proportional to productivity. Trickle down
Circular Flow Model
Market for factors of Production<->Households<->Goods and Service Market<->Firms<->Market for factors of Production. There are two anti parallel flows = Flow of Goods/Services and Flow of Money
Leakages from the Flow = Govt Taxes
Injection: Subsidy from Govt
International Trade and Financial Markets also a part of the flow
Enviroment and other externaility can be included (Modifies Circular Flow from CORE)
Production function and Diminishing Marginal Product
Production Possibility Frontier. It is an oversimplification but has direct implications for developement.
Macroeconomic Aggregates
GDP
of all
Final
Either the final product /service after all value additions is considered or the base value + value added
Goods and Services
produced within a country
in a fixed period of time
The Market Value
The domestic market value is considered. Other inclusions give other measures, can be convered to PPP$ for comparison.
Growth of GDP
YoY or wrt a set year
Key Concerns
Promote GDP Growth
Maintain High Levels of employment (cyclical unemployment as a result of business cycles, short term unemployment doesnt matter)
Ensure Price Stability. The money would be reflective of the production. Too much money or two little money can affect stability.
Types of policies
Fiscal Policies
When there is not much money in the economic system, the government theough subsidies or expenditure can flush money into the ecoomy and go into a deficit budget but ensure stablity.
Policies by changing taxation, subsidy and public expenditure.
Overspending by state can bring economy back on track. Needs some money to start (bonds or borrowing)
Expansion - increase tax or reduce spending
Recession - reduce taxes, increase government spending and deficits, relief packages.
Monetary Policies
Policies of central bank, manage the country's money, credit and banking system.
Recession- increase money spply, lower interest, stimulate business
Expansion - restrict moeny supply, increase interest, reduce investment
GDP Circular Flow
GDP components appear in the Circular flow
Income + Governement Expenditure + investment + Import -Export
Types of calculation
Income approach: GDP = Wage/salary+rent+interest+profit
Expenditure approach GDP = Expediture + Investment + Savings + Export - Import
Value added approach GDP =
Real vs Nominal GDP
Nominal: measured in market proces at that time
Real: Measured in constant prices wrt a particular year
Potential GPD: A maximum sustainable GDP possible for a country. Exceeding it
Utility (Welfare is utility maximization)
Welfare in economics: Judicous use of income in achieving utility
Satisfaction derived from a particular activity or consuming goods
Total Utility(Q) = Total Utility after consuming Q units
Marginal Utility (Q): The additional utility as a result of consuming 1 extra unit after Q units
Constraint Optimization: MUx/Px = constant over x at optimal
Classical vs Keynesian Econ
Classical/Neoclassical/neoliberal
Supply creates demand (Say's Law)
Complete free market
Keynesian/Welfare
State has a key role to play
Leakage (taxes) and subsidies (subsidies)
after great depression, it became important
state roles
Monopoly (Antitrust Law, deregulation)
Externalities (Anti pollution, anti smoking laws)
Public Goods (Provide public education and services)
Inequality (Progressive taxation, Income support programs)
Slow Econ growth (Raise savings by manipulating the deficit/surplus)
Business cycles: Monetary policies (money supply and interests) Fiscal Policies (taxes and spending)
Fallacy of composition (micro/macro): What works at macro doesnt necessarily work in micro and vice versa
Econ Survey 19-20
Wealth Creation "The Invisible Hand supported by the The Hand of Trust" - Adam Smith
GDP growth overstated? Evidence aginst it.
Thalinomics: Economics of a plate of food in India (better now than earlier)
Keynes also referred
Key Points in History
Market Econ
Adam Smith (1776) Classical
Marshall (1980) Neoclassical
Critque of Capitalism
Marxian Econ (1867)
Role of State
Keynesian (1936)
Post war econ (State vs Market, State and Market)
Technology as Creative Destruction (destroys old markets and creates new ones)
Key Concepts (Core concept, Wellbeing Measure, Poverty Measure)
Economic Perpective (Utility GDP FGT)
Poltiical Economy (Power/surplus value GDP FGT)
Human Develoment (Capabilities HDI MPI)
Participatory (Power(mehodical and political) variety of measures at the community scale)
Post Dev or Degrowth (Power {polticial and resources} Not necessary Not necessary) very subjective
Human Development and Capabilties
Measuring Human Development
Indicators
Multidimensional Poverty
Gender Development Index
Human Development Index
Choice of dimensions and indicators
Scale matter: Global Regional Local (Local is easiest to generalise)
Core dimension following key capabilities; indicators to measure and track (data might not be avialble or compare apple)
Weight assigned: Participatory, Based on consensus/evidence, 'Techincally'
Simpler indices are preffered by Policy Makers. Sophistical Statistic might be good for academia but not in the real world
Example: National BPL Census 2002
Criticism that indias BBPL was too TOP-DOWN and demands for bottom up indices came up.
This was a expert consensus driven.
Indices: operational Land holding, food security, ownership of durables, status of childen, type of house, normal wear clothing availablilty, sanitation, literacy, means of livelihood,
States had individual poverty line definitions to give someone support.
Example: Capabilities Metric Kerala 1990s under started UNICEF Nutrition program
This is NOT subjective poverty, but people collectively determine what is poverty to them.
Eg. people who live in an island at a wetland below sea level at a worse state than those access to a main road
Kudumbashree Method
Risk Index: Living in a kattcha house, sanitary, drinking water, alchoholic/drug addiction, barely 2 meals or less. (all equally weighted)
other things considered: severe shronic incurabe diseases, unmarried daughters (important cultural), women lead household, no healthy breadwinner, begging, havinf women subject to attrocities
Somewhat participatory but social
This requires a lot of resources. A lot of money has to be allocated to the panchayat.
It has limitiations so its no longer is used. the general structure is all that remains.
What is income poverty is not necessarily capabilties poverty! Conflict in Kerla state and center.
How participatory things are done?
Sit down with people together
Local Transect Walk
Talk about peoples concerns
Local community decided household categories
Field should inform the academia and academia. Sophisticated statistics are not the solution
Duman Development Report: Technical Annex has the details.
Sample: Global and Regional Scale, Data lag exists as not every year. Based on concsensud and evidence and 'technically' slected
HDI (Human Development Index) focuses on progress
Dimension: Long and Healthy Life, Knowledge, and decent standard of living
Indicators: Life expectancy at birth, Expected/Mean Years of Schooling, log GNI per capita (to account for Diminishing return)
Dimension Index: Life Expectancy, Education Index, GNI index; all calculated as (actual-min)/(max-min) limits based on consensus
GM of the three indices (initially was AM, shifted to GM recently)
Categories: 0.8< very high 0.55> very low
There is a caution using this as wellbeing policimaking
MPI (Multidimensional Poverty) focuses on deprivation
Dimension: Health, Edication, Standard of Living
Indicators:Nutrition,child mortality; years of scholling, attendance; Cooking Fuel, sanitation, drinking water, electricity, hosuing, assets (all are binary variables)
Poverty measure: headcount ratio and intensity of poverty
Each measure is weighted and aggregated to calculate deprivation score c at each household and Multidimensionally poor is seen if c>=1/3
Headcount ratio = % of people M.Poor
Intensity of poverty: Weighted deprivation of the poor
MPI = H.A
HD and Envirnoment
Till now MDG and SDG saw evironment as deprivation but these are the outcomes not the resources. Human Development report of 2020 considers environment much more and looks at the resources like water
Policies are still guided by monetary measures. Further Environmental influences were ignored atleast until 2020.
PHDI (Planetary pressure adjusted HDI) - Arithmetic Mean of CO2 emmision, material footprint per capita = Adjustment factor that is multiplies with HDI to gte PHDI
Amartya Sen's Capabilties Approach
Development is the expansion of freedom
Most of his work is Lectures, Books (Single Author)
Was influenced by Martha Nussbaum
Disciplines: Development Economics and Poltical Philosophy
Things we need beyond basic needs
(most these are to do with freedom
and dignity)
Basic needs (food, clothing, place to stay)
Physical and Mental Health (constrained by healthcare)
Work satifaction and freedom (economic interests)
Social Relationship (constrained by social restriction such as lockdown)
Social and Legal recognition and protection of Identity
Equity in life and opportunities (Polticial interests and understanding the needs)
A good Internet Connection, Ease of Travel (Bicycle), Freedom as a essential Freedom
Free to take a walk at night? Safety and Gender
In control of your career choices? Men vs Women
Riding a Bicycle? Permission to use/ability ot use (disability)
If we want development as flourishing, material objects might have some value but without the associated freedom and agency is worthless
Freedom is flourishing, and flourishing is development. Systemic probihition of freedom prevent development at all scales (community, individual, household,cross-counry)
Formalisation
Core Concepts
Functionings: the things that a person my valuedoing or being
Capabilities: the freedom to enjoy various functioning
Agency: is the ability to pursue goals that one values and has reasons to value. to exercise agency brings change. its the ability to be a participant in the change
World Bank Development Report
What do the poor people want? Voices of the Poor
Poor people values their freedom and dignity and wanted to be valued like others
Basic Capabilities (a wishlist)
Nussbaum: Life, Health, Bodily Integrity, Senses, Emotion, Practical Reason, Afficialtion, Other species, Play, Contro over choice and property
Sen (created no list and said it mush be decided in context)
Related Concepts
Public Action (not only resources are needed, the suporting structures are needed)
Entitlement: Poverty as capability deprivation. It is about how people are under the influece of forces that cause the deprivation. A family is entitled to food but if the man controls the woman's intake, it prevent the entitlement. Beyond legal structure but also social and cultural structure
Moving Beyond economics (1980)
Crticism of Economics
Human Development, Participatory, Post Dev and Degrowth.
Social scientitsts often criticise economic for being too far from relalirty but unfortunatey it is necessary to have metrc. This entire frameowrk is a criticism of economic aproaches
Jodha 1988
The sciience and the scientist
Intereting pioneer in Common Property Resources in India
a field scientist. policies were hugely driven by surveys and qualitative research were largely in academia only and participatory was only in NGO (un formalised)
Amartya sen had a large influence
Popularised by John Chambers
Survey was qualitiative +quantitataive
A minority view that
challences the popular
views
What cannon me measure doesnt exist is suicide
1980 and 1960 comparision (in rajashthan; small sample)
Addresses 1. mismatch (communication gap) between academia and the people 2. concepts and ideas we use as academician.
Appendix
Many concept we use bypass mant important facets:
like household income ignores time and context
Many concepts we use have different meaning to the people: Food surveys - formal consmption is considered but what are small things like a lccally caught fish is not.
Measurements often mean different things: the people use completely different units to describe space quantitiy and time
Degree of Precision might also vary: Age is not exactly known at time, exact number of hours are not known etc.
Approaches
Traditional: Short term go survey comes back
Intensive: stay and spend a lot of time to get data
Differences in the values found
compare 1960 and 1980
Some changes (imporvement) were seen: reduced reliace on landlords, reduced dependece onlow pay lobs shifts in comsumption patterns, acuisition of consumer durables
Looks at small sample of households and sees who have remained same, or have gotten worse and looks at the ones who have gotten poorer. Most changes he observed were not seen in the monetary consuption.
concludes that quantitative insight besides the monetary analysis (supplement quantitiative in qualitiative)
This was a micro level, but after this things started become more macro
Previouly there was a huge dependednce and belief in Trickle don economics but that wasnt working
Denulin and Shahani Chapter 1 part 2
Dispell myths
Assumption 1; High GDP needed for human flourishing. NO PROVEN CONNECTION. HDI, Literacy, Life Expectancy not linked to GDP
Assumption 2: Families with high income will not be deprived in other dimension. Income poor are not the same as nutritional poor and educationally poor
Economic growth wil reduce malnutrition. No look at india itself, no trickle down
Data from income and expenditure are more reliable: No lot of issues, age adjustmentm, household pooling
Takeaway
Wellbeing lies beyond money metric terms
We need to rethink way researchers and policymakers (government) assess rural change, formulate policies and implement programmes for rural change.
We need to supplement quantitative with qualitative
We need to choose dimentions beyond money and find good alternatives (hard at large scale; at small scale researchers can find out what is important to the people)
Local scale passive or active participation helps the people be a part of the analysis. But active participation is needed.
Most importantly need the policiy to be implemented hopefully from the participatory level
Interrorgating Development: Giving up the standard metrics and becoming a critic of development
Participatory Development
Local communities involved at a micro-level. Analytical capabilites of ordiranry pwoplw should be used, expert work alongside not above
NGO and Academia
Related to multiple disciplines: Ecology and Anthropology
But is sort of a toolkit for doing a study
Eg. Maharashtra Forest Dept. Participatory Rural Apprasial
Encouraging participatory programme
Collecting information about community and relations with forests and subjective values of things. Suddenly becomes data collection, but from the local people. No longer a political thing but another more acceptable data collection method.
RRA: Field works do the main thing and dont involve the people that much
PRA: More empowerment and encourage the joint data collection but not a transformation in the community.
"Cheaper" methodological substitutes. Coopting participation to retain their power.
But is Participatory Research
contributing methodologically?
Robert Chambers (Institute of Development Studies)
Huge influence on places like india where development is run by NGOs
Did not invent participatory but formalised and documented the already used field methods to gain information and criticised teh top-down development intervention
Prolific writer who brings the things together and popularised it. He also proposed that this can generate data and can undego detailed analysus. compares on the axis of actor particiapation and qual-quant. Participation is the center of Social anthropology and Economics but is more active. Between: Participant observation, Structured interview and group and visual analysis,
Post Development
Recognising that development is a social construct devises by powerful global actors (colonial forces)
Anthroplogy and Geography used by activists and academia
Ethnography and Participant Study.
Investigative, sometimes doesn't satify the standards of tyoical science. No clear answers, but provide a perspective
Recognised and studies the dominant narratives (urban male as the epitome of development)
What is being critical?
Question dominant creation about methods, about knowledge creation, changes in human nature relationships
Sometimes coming up with alternatives
Bejoy Paper: Criticism
of Development
Methodological
Critique of methods in field studies (Questionnaire surveys and quantitiative are not enough, topdown, disciplinary connotation of Econ v Antropology), Jodha finding a different subjective answer to poverty. NGOs use participatory methods.) Qual-Quant the new thing.
Political
Participation is poltical not a toolkit (Pedagogy of the opressed - Paulo Freire ie. knowledge is a mutal organic way of learning through engagement, Decentralization, People as active political agents).
Eg, Tribal community threatened. Social movement: organic and lasts till the problem exists. (Gramsci) NGOs at the end of a day will be a professional form.
Depoliticization makes it a mere set of toolkits and a extractive way of getting knowledge (has become so common its taking as granted; eg. they've kept doing it making it a mere data tool). Differences between: NGOs (no longer voluntary but professionals; not different from the mainstream) and Activists/Social movements and civil society (much more organic)
Post Development (Escobar 1999 and
Fergussons's Anti Politics Machine 1994)
Draws from social scientists (Foucault's discourse and power analysis)
Talks about development in the 1950s, decolonization, , Truman speech about helping the poor countries (draws ideas from documents and speeches from hsitory)
Focus on Columbia. There was a predertmined goal that was set without the consultation of the poor countries itself. All of this was constructed and planned with their own agenda. Creating a altenative narrative. All of this (development third world) an invented idea, a social historical construct. And imagines an alternative, a world beyond development.
Fergusson: Lesotho, lens of failed attempts of development
Ashish Kothari: Pune based degrowth narrative and local self sufficiency. Other like Martinez Alier
academic: priviledged experts
methodological:
extension academia: professors work on plots in agriculture universities and economics see the feasibility and extension academia takes it to the public
What is Knowledge in Development Studies?
Is the knowledge good credible
proper (academic knowledge?)
Summer and Tribe "what makes rigorous DS?"
Refelctive practitioners
What is Economics is a benchmark?
How is knowledge created?
(ontology=what,epistemiology=how)
Classical Approach
(Positivist Approach)
Only experts can create knowledge.
Grassroot opnions dont form knowledge
Hypothesis-> methodology (testing)->Valid (knowledge)-> valid in n tests (Science/Truth)
Factual knowledge is the only scientific knowledge. RCT can create knowledge. A valid hypothesis is knowledge
Depends on Objectivity (indeependent of researcher); Quantifiability (truth must be numerically representable); predictability (since its valid in n test, it willne in the n+1 test); replicability (results of n tests are the same/indistinguishable)
Challenging the approach
Relationship between researcher and researched (power relations and historicism) subjectivity vs objectivity
Role of language: placing words with numbers; language and discourse
possibilitie of different but valid outcomes (substituting predictability with inderminability and pluralism;pluralism != indeterminability but related concepts. Tribal vs local vs expert knowedgle needs to be acknowledged as equal)
Behavioralist Approach
Human action is mediated through the cognitive processing of behavior (Skinnerian Behioralism)
Very influential and is assumed to be the truth due to conditioning when reading papers. Something other experiences create alternate realizations
Random sample surveys and experiments
Phenomenological Approach
research should understand than explain the word. resconstrcting "narratives"/"life knowledge"
social workers influenced by this
ethnography and participant observation and focus group discussion
Marxist approach/Historical Materialist Appraoch
insvestigae the politicaleconomic struvtures that underly class stuggles
Historical data and analysis
Post Modernist
No one truth, researchers should focus on 'readings' not observations, 'interpretations' not findings.
Eg. escobar "reading" the texts in the historical context
deconstruction/textual analysis of political and cultural decision/practice
Post struturalist approach
Relationship between society and culture is mediated through language
deconstructure of language and textual analysis
Feminist approach
science is dominated by and reflects the position of men and there needs to be a re-negotiations of the production of knowledge and power relations
household decision making, qualitiative and quantitative
Participatory Appriach
Models of Development
Kuznets Curve
Theoretically appealing
Gini Coefficient vs GNI per capita (peaking)
Empirically contested (Latin american case it fall apart, high inequality throughout)
Increases inequality but then welfare policies to decrease inequality
Similar ideas about pollution (SO2) vs GNI/capita (india,china)
model of economic growth
Linear Growth Theory
Deterministic eg. marxian, a deterministic path through history
many neoliberal ideas are also linear: the wester development paths (Rostow The Stages of Economic Growth: Non Communist Manifesto)
Structural Growth Theory
Structural development, change structure of economy from agrarian (with surplus labor) to industrial (flow of surplus labor) (Lewis model og dualistic development)
Dependency Theory
Marxian argument but for core (colonising/North) and periphery (colonised/South), colonial/geographical dependence on development
Linked to degrowth and historical patterns of exploitation
Rostow 1960
Traditional Society-> Preconditions for Take-off->Take-off-> Drive to maturity- age of high mus consumption (focus on quantity to focus on quality)
non Communist Manifesto
Harrod Domar Grwoth Model (1950s)
Strong influence on india (Mahalanobis model)
GDP growth happens as a joint process of national savinf ratio and capital output ratio
Saving have to be channelised into production investiments via state investments
Push can come from Govt (Keynesian Principle) in capital investment and developing countries should be supported with aid and technological flows (neocollonial ideas of maintiaing dependence despite sovereignity)
Lewis Model
Imrove productivity and wages by moving from agrarian surplus labor to industry and improve the economy
Capitalist reinvestement expands production and wages
Two sectors in the economy: Agrigulture and Manufacturing Sectors Surplus Labor
labor demand curves under perfect competion would shift upwards if there is a flow of surplus labor from agriculture to manufacturing and improve production,
Agriculture prdoductivety to basic needs (1970s)
India - drought-> green revolution-> agriculture investment
for the first time poverty started beeing considered
living conditions had not improve
trickle down idea was not working
Roti Kapra Makan and Garibi Hatao
Dependecy theory (1970s)
Unequal power relations in core and periphery countries
Elite in LDCs also propagate inequity
Underdevelopment is externally imposed and not internal constraint (Rostow, Lewis)
Empirical Evidence? Deteriorating trade (Prebisch singer Hypothesis), LDCs get less manufactured good from raw material in international trade Policy implications: Import substituting industrialization
Poverty and Inequality Measurement
It is Normative
Different Idea of Poverty (eg Econ, Participatory)
Different data (eg. income/consumption,health)
Different analysis
Different results
Inequality, Poverty, Development
Welbeing/welfare/development -> signify improvement. Look at the entire distribution of people to come up with a wellbeing measure (eg GDP) "Ecocomy at its entirety" / "unit in an aggreate"
Economic = Typically unidimensional measures but Human Development = multidimensional (education health income) <- More reflective of wellbeing
Inequality measures take a loot at the entire distribution and look at each persons income and studies skews. Can be unidimensional or multidimensionsal
Poverty measures only look at units below a certain arbitrary level of income. Look at the subthreshold distribution.
Poverty Measures
Identification Problem: Who is Poor?
Poverty line calculation (minimum basket of goods to get enough calories)
Above are not considered only below PL
Aggregation Problem: How Poor?
To select (a) poverty ind(ex/ices)
Poverty as not fulfilling minimum income(utility) eg cost of a basket of goods -> Income equivalent recquired to meet it.
Types of Monetary Poverty Measures
Absolute Poverty Measure
Relative Poverty Measure
Subdivided into regions and comparative
Subjective Poverty Measures
The person decided whether they fit into category
Consumption vs income
Income (potential) is more dynamic over life but consumption (acheivement) is more constant and changes are smooth
easier to collect information on money spend than the income
consumption is often preffered
Welfare indicator: yi (income) = p(price).q(quantiity) = e(p,x,u) expenditure to acheive maximum utiity u with p-vector of prices and x-vector of house characteristics (age education gender etc) typically for food expenditionre
Intrahousehold differences: Adult Equivalent = 1 + 0.7(Nadults-1)+0.5 children (more adults have a lesser value)
Setting a poverty line = zi = e(p,x,uz) uz = utility at poverty line.
Referencing problem = WHAT IS THE VALUE OF Uz?
Is calculating the number of people BPL enough?
No the the distribution under the BPL is also important,
Number might be same but poverty severity maybe different
Poverty Gap measures (Foster–Greer–Thorbecke indices)
Pa = 1/n sum(((z-x1)/z)^a)
Quantify dept of poverty and severity
P0: = headcount poverty rate (importance to those at PL), P1: poverty gap index (average deviation from poverty line; importance to mean BPL): P2: squared poverty gap (more weight to the poorest)
Indias experience with poverty
1971: calorie poverty line (Dandekar and Rath)
1993: state specific poverty line (Lakdawala)
2009: nutirtion and private health and education (Tendulkar: Rs 32 a day)
2014: higher poverty line than Tendular but was not accepted (Rangarajan)
NO NEW OFFICAL POVERTY ESTIMATE since 2011/12
Inequality Measures
Functional distribution of income
Distribution of income among factor of production (Land Labor Capital, distribution between capitalist vs labor)
Personal Distribution of income
Distribution of income among individuals/households
Divide population into size classes- quintiles,deciles
Gini Coefficient
Lorentz curve (cumulative income vs cumulative population from poorest to richest)
Gini = relative area between graph and absolute equality (A/A+B)