RIP Douglass North

Douglass C. North, PhD, co-recipient of the 1993 Nobel Memorial Prize in Economic Sciences and the Spencer T. Olin Professor Emeritus in Arts & Sciences at Washington University in St. Louis, died Monday, Nov. 23, 2015, at his summer home in Benzonia, Mich. He was 95.

An economic historian, North examined the effects of institutions on the development of economies through time. His work shed new light on economic development in Europe and the United States before and in connection with the industrial revolution. He emphasized the role of property rights and institutions.

North joined Washington University in 1983 as the Henry R. Luce Professor of Law and Liberty in the Department of Economics in Arts & Sciences after serving 33 years on the economics faculty at the University of Washington in Seattle.

He also served as director of Arts & Sciences’ Center in Political Economy from 1984 to 1990. He remained active in teaching and research at Washington University until his health began failing over the past few years.

He and Robert Fogel, PhD, an economist then with the University of Chicago, were co-recipients of the 1993 Nobel in economic sciences “for having renewed research in economic history by applying economic theory and quantitative methods in order to explain economic and institutional change.”

More on this here.

Tyler Cowen has Douglass North links here.

This is a must read.

Brazil is officially the 2nd biggest black country, after Nigeria

The Guardian reports:

For the first time since records began black and mixed race people form the majority of Brazil’s population, the country’s latest census has confirmed.

Screen Shot 2015-11-22 at 7.29.36 PM.png

Distribution of Mixed-Race Brazilians

Preliminary results from the 2010 census, released on Wednesday, show that 97 million Brazilians, or 50.7% of the population, now define themselves as black or mixed race, compared with 91 million or 47.7% who label themselves white.

The proportion of Brazilians declaring themselves white was down from 53.7% in 2000, when Brazil’s last census was held.

But the proportion of people declaring themselves black or mixed race has risen from 44.7% to 50.7%, making African-Brazilians the official majority for the first time.

“Among the hypotheses to explain this trend, one could highlight the valorisation of identity among Afro-descendants,” Brazil’s census board, the IBGE, said in its report.

According to the census, 7.6% of Brazilians said they were black, compared with 6.2% in 2000, and 43.1% said they were mixed race, up from 38.5%.

Ethiopia is the third biggest. With about 94 million people.

Falling Oil Prices Weighing Down Angolan Economy

According to the IMF:

kwanzaThe oil price shock is adversely impacting the economy. Angola’s oil basket is projected to average US$53 per bbl in 2015, from slightly over US$100 per bbl in 2014, leading to large declines in fiscal revenue and exports. While oil production has recovered following the completion of maintenance work, non-oil GDP growth is expected to decelerate to 2.1 percent in 2015. The industrial, construction and services sectors are adjusting to the decline in private consumption and public investment and lingering difficulties to obtain foreign currency. Inflation is projected to reach close to 14 percent by end-2015, exceeding the National Bank of Angola (BNA)’s 7-9 percent objective. The 2015 budget will allow the central government deficit to fall to 3.5 percent of GDP, compared to 6.4 percent last year. Public debt, however, is projected to increase significantly to 57.4 percent of GDP, of which 14.7 percent of GDP corresponds to the state-owned oil company Sonangol, by end-2015. The external current account deficit is expected to reach 7.6 percent of GDP in 2015; and international reserves to drop to US$22.3 billion (about 7 months of 2016 imports) by end-2015. Meanwhile, a wide spread emerged between the parallel and primary market exchange rates, pointing to an imbalance in the foreign exchange market.

The economic situation in 2016 is likely to remain challenging as international oil prices are not expected to recover and risks are on the downside. Growth is projected to remain stable at 3.5 percent in 2016, with the oil sector growing by about 4 percent. The non-oil sector is expected to show a small improvement, growing by 3.4 percent year-on-year, driven mainly by a stronger recovery in agriculture. Inflation is projected to slow to 13 percent at end-2016, as the effect of the recent monetary tightening is expected to be felt more clearly in the second half of 2016.

More on this here.

Former HIPC countries are back in the red

The Journal reports:

Mozambique was one of the biggest benefactors of debt forgiveness, with its debt slashed from 86% of gross domestic product in 2005 to 9% the next year. The country has built it back up since then to 61% of GDP.

Ghana’s debt was 82% of GDP in 2005 just before the international community forgave about half of it. It’s now up to 73% of GDP and growing, according to the IMF.

The burgeoning debt burdens are putting more pressure on African budgets. The cost of servicing Ghana’s debt will consume nearly 40% of government revenue this year, according to an analysis by Fitch Ratings — twice what is considered sustainable under the rule of thumb used by the IMF and many analysts.

More on this here and here and here.

On Autocracy and Famines: The Disturbing Case of Ethiopia’s EPRDF

VOA reports:

“Regarding the impact on economic growth, the drought-affected areas are peripheral and pastoral communities in the southern and eastern parts of the country,” Finance Minister Abdulaziz Mohammed told Reuters in an interview.

Normally, those parts of the country contribute not more than 5 percent to our GDP. On the other hand, we expect harvest to be more this year.

Abdulaziz said the government will not divert funds from other projects in its budget to deal with the drought.

“The government has immediately responded to the humanitarian crisis and so far we have been able to control the impact of the drought,” he said. “But we have not yet diverted any resource from our development projects. We have been doing it from our own reserves. We don’t expect any diversion.”

Donations offered to address crisis

Earlier this week, the United States Agency for International Development (USAID) announced a donation of $97 million for Ethiopia to help feed more than 8 million people in need of aid because of the drought.

Addis Ababa knows that America will pick up the slack. America needs the Ethiopian military’s help in fighting its enemies in the Horn. A pretty happy marriage. Screw those peripheral Ethiopians contributing less than 5% of GDP. All 8 million (or roughly one Switzerland) of them. They are only 8.5% of Ethiopia’s total population, anyway.

Plus EPRDF is so popular it has 100% of the seats in Parliament.

More on this here.

The Kenyan Army’s Criminal Racket in Somalia

Quoting from a new report from the Journalists for Justice project:

With the death toll from al-Shabaab attacks inside Kenya rising to over 400, Journalists for Justice felt that the task of examining whether Operation Linda Nchi is actually delivering was overdue. This study looks at the conduct of KDF forces in two areas: 1) sugar smuggling and financial enabling of al-Shabaab and, 2) human rights violations.

This report presents the findings of several months of research in Somalia in Kismayo and Dhobley and inside Kenya in Liboi, Dadaab, Garissa and Nairobi. A desktop review, encompassing UN monitoring reports, academic studies, African Mission in Somalia (AMISOM) communication and media reports was followed by one-on-one interviews with over 50 people with intimate knowledge of KDF activities, including serving senior KDF officers, UN officials, western intelligence officials, members of parliament, victims of KDF human rights violations inside Somalia, journalists, doctors, porters at the charcoal stockpiles, drivers on the sugar routes and middlemen in the Dadaab camp.

…. JFJ research suggests that both KDF, the Jubaland administration of Ahmed Madobe and al-Shabaab are all benefitting from shares in a trade that is worth, collectively, between $200 million and $400 million.

More on this here.

For more on the challenges facing Kenya’s security operation in Somalia see here.

Gender and Politics in the American House of Representatives

The Hill reports:

The prevalence of women on the committee [select committee on Planned Parenthood] is almost without precedent in the House.

The only other House committee in history to have a woman serving as chairman and ranking member was the House Select Committee on the Beauty Shop. That panel existed from 1967 to 1977, and oversaw the operations of a salon on Capitol Hill. The panel was later folded into the House Administration Committee.

Only 19.3% of members of the U.S. House of Representatives are female. If ever there was a clear justification for gender quotas in representative politics, the U.S. Congress is it.