A short reading list for development economists and practitioners

Below is a list of books I am currently reading and that I think most development economists (and anyone interested in development) would benefit from reading. The reading list is America-centric and provides a mix of economic history and the history of governance in the US.

Let’s make this a year in which development economists and practitioners read more economic history.

  1. The Tycoons: Charles Morris’ book outlines American economic history from the perspective of four of the country’s most celebrated businessmen: Jay Gould, John D. Rockefeller, Andrew Carnegie and J. P. Morgan. You think corruption is bad for development? Can industrial policy help poor countries overcome the poverty trap? And how exactly do countries become rich? These are some of the questions that are implicitly addressed in this rather easy to read book.
  2. FDR by Jean Edward Smith: If America ever had a developmental president, it was FDR. His big push to help regular folk with the New Deal and other government programs took water and electricity to many corners of America that had previously been forgotten by mainstream politics. The story of American development is a caution agains the prevailing fascination in the development community with small-scale pro-poor initiatives that largely sidestep the state. Development is political (because it creates relative distributional winners and losers) and those who ignore this fact will always fail.
  3. The Search For Order, 1877-1920: Want to know more about how America became modern? This book provides a glimpse of the period in American history between the era when robber barons ran the show and when formal institutional arrangements became commonplace in business and government alike. The book provides an excellent account of the dynamics of institutional development both in the public and private sectors.
  4. The Evolution of American Legislatures: Want to know how US State Legislatures have evolved from the colonial times to the present? The you must read Squire’s book. I loved reading this book [yes, because I study African legislatures myself] precisely because it gives a detailed account of the very undemocratic origins of the democratic institution of the legislature(s) that we associate with modern United States. The book is a caution to institutionalists who peddle the false idea that good institutions are born good and stable. The lesson from American history is that it is all about how checks are enforced, and that sometimes to guarantee enforcement you might need to limit political participation and choice.
  5. Abraham Lincoln by Lord Charnwood: I now live in the land of Lincoln and so this was a must read for me. The big development lesson from this book is that civil wars are complex and that sometimes nations ought to be left to recover autonomously. Just imagine how the history of the US would have played out if the UN already existed (and at the time dominated by the UK, France, and Germany) and had sent in peacekeepers right after the Confederates seceded…. The book is also a nod to the Great Man theory by showing us how Lincoln’s personal life and conviction played a big role in determining the course of US history.
  6. 1913 The Eve of War: This is a random addition to the list, I know. But I added it to remind readers that things can always go wrong in the international system, with grave consequences for the entire global community. The book is also a good lesson on how Great Powers can sometimes be forced into conflict even when they would prefer not to fight.
  7. The Great Escape: I know I am late to the game on this one but Angus Deaton’s book (which got glowing reviews in the Fall) is a great account of the public health advances of the of the last century in both the developed and developing worlds. The book also reminds us that economic inequality is not always a bad thing, as long as everyone’s living condition is improving – which he says has been the case for much of the last century. Also, Deaton reminds us that aid is not the panacea to underdeveloped and that it might actually lead to more harm than good. But the solution he runs to – good governance – is equally problematic. 21st century good governance means zero tolerance on corruption, crony capitalism, and state capture by the business elite. Yet if you read the books above, you realize that because of the political risks involved in poor (or less institutionalized) countries, sometimes the habits associated with bad governance are the only means available for incentivizing investment. The point here is not that we should neglect the fight against bad governance, just that “Governance” shouldn’t be the only consideration when thinking of factors that retard economic growth. Just imagine how the Transparency International report on corruption in the US circa 1920 would have read like.

quick hits

This is progress. I hope PLO does not go the way of most idealists and get sucked into the vortex that is Kenya’s corruption and patronage networks. Relatedly, the latest TI ratings suggest that corruption may have declined a tiny bit in Kenya. Rwanda still leads the pack as the least corrupt country in the wider region, although critics argue that this has come at the price of basic civil liberties as the mountainous country transmogrifies into an unapologetic police state.

Be sure to read WTF Friday on wronging rights…

my two cents on the new constitution

What I liked:

  • The bicameral parliament. It is expensive but will serve to give the regions a voice.
  • The regional governments. Great idea, but how are they going to be funded? I would have loved it if there was a provision that each region should generate enough revenue to fund a fixed percentage of its budget. This way the regional governments can have incentives to promote economic activity in their regions. Better yet the central government should have been mandated to only issue matching grants to these regions – to spur competition among them for funds for such sectors as education, healthcare, infrastructure development, etc
  • Retention of the Kadhis courts. I am glad that sanity prevailed on this one. Kenyan Christians were being absolutely crazy in their opposition to this.

What I did not like:

  • The judiciary. Judges of the Supreme Court should have had life tenure. They should have created regional court systems. And they should have done away with the “traditional” court systems – whatever they are?
  • Traditional marriages should have been trashed. Marriage should be between two people. Polygamy is an affront on women’s rights. Period.
  • And about gay marriage, I don’t think it was necessary to spell out that marriage is between a man and a woman. These guys should have been open minded enough to allow for the possibility of Kenyans being more liberal than they currently are.
  • Vote share for Nairobi in the Senate. Nairobi should have had one of the biggest shares of Senate votes – by virtue of it being the economic hub. Instead the Rift Valley, with its many underdeveloped counties, has the largest share. Call it urban bias, but I don’t like the idea of rural non-tax-payers always having the biggest say on who gets to steal the money paid in taxes by Nairobians and other city dwellers.
  • The lack for autonomy of towns and cities. The counties idea is great, but we should have designated cities and towns that were autonomous  – with their own police forces and stuff. Security and Justice are political and should have been devolved too.

And in other news, Kenya is still among the most corrupt countries in the world. The new TI corruption perception index ranks Kenya at 146 out of 180 states. This is one more reason to fire Amos Wako, Kenya’s Attorney general since forever. And while we are at it we should also get rid of the Chief Justice. Mr. Gicheru has not lived up to expectations. He was appointed to clean up the judiciary but ended up in the pockets of the powers that be.