Big vs. Small Development

The Economist raises an interesting question regarding approaches to “development,” claiming that the recent race for the World Bank presidency represented a contest between two broad approaches:

Michael Woolcock, a World Bank staffer, suggests that two rather different models of development have been pitted against one another in the contest for president. On the one hand is what he calls Big Development, whose aim is the transformation of entire countries through investments in national education, justice and public health. Governments are essential to Big Development because they are responsible for the overall policy. And the World Bank is pre-eminently a Big Development institution.

On the other hand is Small Development. “Inspired less by transformational visions of entire countries,” Mr Woolcock argues, “and more by the immediate plight of particular demographic groups (AIDS orphans, child soldiers, ‘the poor’) living in particular geographic places (disaster zones, refugee camps, urban slums), Small Development advocates focus not on building systems in the medium run but on compensating for the failure of systems in the short run. ‘Development’ thus becomes an exercise in advocacy, in accurate targeting, in identifying particular ‘tools’ that ‘work’”.

In this scheme of things Mrs Okonjo-Iweala, the former finance minister, represented Big Development; Dr Kim, a public-health advocate, Small. Dr Kim was almost certainly picked because of his passport. But if his background is any guide, his tenure as chief is likely to shift the bank more towards Small Development. Whether that is a good thing on balance remains to be seen.

I take the side of Big Development (if such a dichotomy actually exists) because of my beef with “pro-poor development” as it is currently practiced  (more on this here).

Development is a giant coordination game with a million moving parts. This makes it much harder to coordinate on “scalable” “tools that work” at the micro-level. Indeed, no one has any idea what these tools really do. In addition, focus on “tools” casts the problem of underdevelopment as a technical one that can be fixed by “experts.”

This approach misses the point by miles.

This and this (highly recommended, a cogent critique of Big Development) and this are some of the reasons wby.

More on Obama’s WB President Nomination

Source: Wikipedia

Nigerian Ngozi Okonjo-Iweala is definitely the dream candidate for the Bank. But the realities of U.S. domestic politics and foreign policy concerns are stacked against her nomination to the presidency of the Bank. It will be hard for the U.S. to selflessly relinquish an important tool of foreign policy and influence in the Bank’s presidency.

If Obama backs down, he will be criticized for being soft in the face of international pressure. If he nominates a non-American, he will still be criticized as an apologist for those who hate America (real or imagined) and a believer in American decline.

Obama’s incentive is to get his nominee become World Bank President. Full stop.

Source: Wikipedia

So far those rooting for Ngozi (including yours truly) have questioned Jim Yong Kim’s credibility (he is/was not a fan of neo-liberalism) and competence (he is not an Economics PhD; but a mere MD, PhD) as World Bank president.

You can get Kim’s co-authored book here (or your local library; $97 is a bit pricey), it is on my to-read list (A review of the book is available here).

Here is quoting a post over at the Duck of Minerva for a more balanced take:

If Dr. Kim criticized the growth agenda of the structural adjustment era, so what? This has all become mainstreamed into the Bank’s own philosophy of pro-poor growth.Does it take a PhD in Economics to run the World Bank successfully? If selected, Dr. Kim would be the leader with the most hands-on development experience that the Bank has ever possessed. He would be as or more experienced in the field as serious contenders that were mooted in advance like Susan Rice, Hillary Clinton, or Pepsico CEO Indra Nooyi (ok, maybe Larry Summers knows more but Summers always know more than anybody). As Daron Acemoglu and Jim Robinson pointed out on their blog [Why Nations Fail]: “Perhaps all of Mr. Kim’s critics prefer the status quo where the World Bank is run by ex-warmongers (Robert McNamara), bankers (James Wolfensohn) or career civil servants (Robert Zoelick). Wait wasn’t that the World Bank that they loved to criticize?”

Adding that:

You don’t have to denigrate Dr. Kim to praise the other candidates. The strongest case is that while Dr. Kim is a good candidate, Dr. Okonjo-Iweala is the dream candidate. She’s from a large developing country, knows the issue well, understands the complex world of global finance, and is intimately familiar with the culture and organization of the Bank. And, for her supporters, the changing nature of the international system has made this practice of the U.S. having the automatic right to appoint the Bank’s president an anachronism.

Beating the drum for Ngozi

The Economist has joined a string of internet commentators in endorsing Nigerian Minister of Finance to become the next president of the World Bank. Contrasted against the resume of Obama’s choice for the Bank, Ngozi wins. By miles.

According to the Economist:

The World Bank is the world’s premier development institution. Its boss needs experience in government, in economics and in finance (it is a bank, after all). He or she should have a broad record in development, too. Ms Okonjo-Iweala has all these attributes, and Colombia’s José Antonio Ocampo has a couple. By contrast Jim Yong Kim, the American public-health professor whom Barack Obama wants to impose on the bank, has at most one.

However, it is interesting that in all the debate no one has talked about HOW Ngozi will change the Bank’s operations, besides insinuations that she has hands on experience in transforming Nigeria’s public finances, coupled with her previous experience at the Bank.

More importantly, what would be the cost to Nigeria if they lose Ngozi? Is this important at all?

Ngozi leading the bank will probably make a difference. However, I think that support for her candidacy has thus far been too one-sided. Nigeria, like much of the developing world, does not have much influence on the Bank’s board. Nigeria also stands to lose one of its ablest technocrats just when it is striving to reform its public finances. These considerations should matter too, I think.

Just for the record, I am one of those who think that it would be really cool to have Ngozi lead the Bank (despite the fact that she probably will not).


Update: I just came across some interesting thoughts on Ngozi’s nomination over at Africa is A Country (H/T Chad).