institutions, culture and economic development

I am currently taking a class taught by Avner Greif, an economist/economic historian at Stanford in the tradition of New Institutional Economics. The class introduces ideas about economic development from a perspective that does not get much attention from economists, i.e. culture and its impact on long-run institutional development.

In one of the readings Tabellini argues that:

Well functioning legal institutions breed good values, since legal enforcement is particularly relevant between unrelated individuals. …… better informal enforcement sustained by ongoing relations in a closed network may be counterproductive for values.

Thus, the model predicts that clan based societies develop very different value systems compared to modern societies that rely on the abstract rule of law.

That’s in The Scope of Cooperation.

The paper provides a model of the recursive interaction between good institutions and culture. The scope of cooperation and interaction matters for institutional and economic outcomes. Clannishness, whether in Southern Italy or Mogadishu, is bad for economic development.

But you need a functional state system for people to be able to even contemplate abandoning the insurance scheme that is the clan. The model predicts two steady-state equilibria. Institutionally speaking, you are either Botswana or Chad.

kcse results through sms

For those out there who have been asking about how to get your KCSE results, I believe there are a bunch of sms services that help with this. Here is one from last year, I am not sure if it asks. I will keep looking around for a guaranteed service provider.

child-bride index

African states dominate the Economist’s child-bride index, with the Sahelian states of Mali, Niger and Chad in the top three. They also have the lowest literacy rates among their female populations.

This is one of those problems associated with “culture” that most development experts shy away from. My take on this is that the cultural defenses of such practices is a lot of horse manure.

There is nothing African about marrying off a 12 year old girl.

Most child marriages have deep-rooted economic motivations. In most cases it boils down to the bride-price. Solving the problem will therefore require not just laws that throw “human rights” at young African girls, but a concerted effort that also includes development practitioners to provide alternative income to men who marry off their 12 year-olds in exchange for goats.