Greg Ransom
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Ransom Papers
The most predominant topic in this portion of the book is the role of the people in government in promoting growth. Easterly points out that the incentives faced by governments and their workers in developing countries which receive aid are, for the most part, not conducive to actual reforms which might promote growth. Instead the incentives are for corruption, stalling, appropriation, and deception. It is in this section in particular in which truly concrete prescriptions are somewhat lacking. While some ideas are suggested, Easterly seems willing to leave the decisions to the World Bank and IMF, the very institutions which have failed to succeed so often in the past. Overall it is an extremely well done piece of work, although in a way it is just as utopian as Sach's recent book, of which he has been critical. I hardly expect that the World Bank and IMF leadership will come around soon to the sort of hard-hearted attitude that Easterly believes is necessary for these institutions to truly be effective in reducing poverty in the developing world .. I would highly recommend this to just about anyone. It is accessible to even the most casual of armchair economists, but extensive footnotes and references (just a hair under 40 pages combined) allow interested parties to easily verify Easterly's claims if they so desire ..Is the music celebrity -- and African debt savior -- Bono literate? If he is, then instead of nominating Bono to run the World Bank, perhaps Michael Kinsley at the Times could send his friend a copy of Easterly's book and encourage him to give it a go. If we establish he's capable of that book reading thing, then maybe we'll go ahead and put him in charge of global economic development. Ya, right. Posted by Greg RansomRegarding debt relief Easterly points out that when debt was forgiven, in most countries "government replaced forgiven debt with new debt." (pg 126) This fact seems to have surprised those responsible for forgiving the debt, but I wonder why this should not have been the obvious outcome. Forgiving the debt does not change the incentives faced by the borrower, except perhaps to make them want to INCREASE their debt load.
