What Do We Know About Economic Growth, Redux is an unpublished short paper. It revisits the cross-country growth literature six years after What Do We Know About Economic Growth Or, Why Don’t we Know Very Much? Since then, even more evidence has piled up that growth is a complex, context-dependent process difficult to explain using linear growth models. We do know that the best way to be rich today is to have been rich yesterday, however. That result has led some researchers to revisit Nineteenth Century explanations including God and superior breeding as the ultimate determinants of wealth. But the ‘truly ultimate’ answer may as well turn out to be geography.
Charles Kenny
Books, Papers and Articles
Charles Kenny writes about global development — what’s working, what isn’t, and how the world can do better. An economist who spent fifteen years at the World Bank, he is now a senior fellow at the Center for Global Development in Washington, DC.
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Baywatch: Bigger than Aid? is an unpublished short paper. It ponders the economic impact of the television program Baywatch —an everyday tale of lifesaving folk– on people in the developing world. It concludes that, without considerably greater academic attention to the subject, we may never know the coefficient of Baywatch episodes on per capita income growth.
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Ending Global Poverty Through Tax Breaks to Bill Gates is an unpublished short paper. Many developing countries have enacted or are considering subsidies and tax breaks for the ICT industry. This paper argues that the economic justification for such favoritism is very weak. It is based in part on material from Overselling the Web. A version was published in The Globalist.
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Infrastructure Governance and Corruption: Where Next? was issued as a working paper in August, 2007. Governance is central to development outcomes in infrastructure, not least because corruption (a symptom of failed governance) can have significantly negative impact on returns to infrastructure investment. This conclusion holds whether infrastructure is in private or public hands. This paper looks at what has been learned about the role of governance in infrastructure, provides some recent examples of reform efforts and project approaches, and suggests an agenda for greater engagement – primarily at the sector level – to improve governance and reduce the development impact of corruption. The discussion covers market structure, regulation, state-owned enterprise reform, planning and budgeting, and project design. The paper was the subject of an Economic Times op-ed.
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ICTs Enterprise and Development is a draft chapter for ICT4D edited by Tim Unwin. It was written with Mike Best. There is no doubting that ICTs have had a significant development impact. Micro- and macroeconomic approaches alike suggest that the rollout of ICTs has improved livelihoods and increased the productivity of businesses. At the same time, the ICT industry itself has been a significant source of profitable investment and employment. This is not to suggest that ICTs are a silver bullet for underdevelopment, however. Successful utilization of communications technologies –and perhaps in particular the Internet—takes a broader economic environment that is conducive to their exploitation. Similarly, ICT industries and ICT-enabled businesses need an investment climate that includes an educated workforce with appropriate technical skills, access to entrepreneurial finance and business talent, reliable infrastructure, a robust but reasonable regulatory environment, and so on. Information and Communications Technologies have a role to play in the development process, but they are one player in a large ensemble cast.
I wrote an earlier collaborative paper on the impact of ICTs on development with Richard Heeks. The Economics of ICTs and Global Inequality: Convergence or Divergence for Developing Countries? was published as an IDPM Working Paper. If debate on ICTs and development has drawn from any discipline, it has tended to be sociology. This paper attempts to broaden the debate by drawing on economic evidence to ask: will ICTs support economic convergence or divergence between developing and industrialised countries? In an overall sense, technology is fundamental to development. However, ICTs – while having an uncertain impact on growth – are currently a force for global economic divergence rather than convergence. They diffuse more slowly in developing countries than industrialised countries, and they bring fewer benefits and greater costs to developing countries than industrialised countries. This does not present an argument against adoption of ICTs by developing countries. Rather, it presents an argument for focus on particular applications and investment priorities.
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This is a review of Avner Offer’s The Challenge of Affluence: Self Control and Well-Being in the United States and Britain Since 1950. It appeared in the Business History Review vol. 81 no. 2. The book is well worth a read.
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Is Anywhere Stuck in a Malthusian Trap? is an unpublished short paper. The key features of the Malthusian model are that (i) income determines population growth, with rising wages increasing survival rates and (ii) there is a vital factor of production (land) which is fixed, implying decreased returns to scale for all other factors. The equilibrium state in such a model is a population living on subsistence incomes. The analysis in this paper suggests that (i) the link between income and population growth is (almost) everywhere broken and (ii) there is little evidence of declining returns to scale because of constraints imposed by land carrying capacity at the macro level anywhere. Population dynamics are being driven by non-income factors in a manner that is reducing population growth rates everywhere. At the same time, output is increasing everywhere, in a manner inconsistent with significantly declining returns to scale based on land being a vital factor of production.
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Construction, Corruption and Developing Countries was published as a working paper in June, 2007. The construction industry accounts for about one-third of gross capital formation. Governments have major roles as clients, regulators, and owners of construction companies. The industry is consistently ranked as one of the most corrupt: large payments to gain or alter contracts and circumvent regulations are common. The impact of corruption goes beyond bribe payments to poor quality construction of infrastructure with low economic returns alongside low funding for maintenance-and this is where the major impact of corruption is felt. Regulation of the sector is necessary, but simplicity, transparency, enforcement, and a focus on the outcomes of poor construction are likely to have a larger impact than voluminous but poorly enforced regulation of the construction process. Where government is the client, attempts to counter corruption need to begin at the level of planning and budgeting. Output-based and community-driven approaches show some promise as tools to reduce corruption. At the same time they will need to be complimented by a range of other interventions including publication of procurement documents, independent and community oversight, physical audit, and public-private anticorruption partnerships.
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Internet Governance on a Dollar a Day is forthcoming in Information Polity. Globally, around one billion people live on a dollar a day. About 44 percent –nearly half– of the World’s population lives on less than two dollars a day. This paper examines the importance of "Internet governance" to such people. Arguments over generic top-level domain names might seem of somewhat esoteric interest to the subsistence farmer. Indeed, if Internet governance is defined in the narrow sense of the management of TLDs (Top Level Domains) and root zone files, it is surely of little importance to poor people. However, given the nature both of technology and of poor people’s demands for information and communication, a broader definition of Internet governance does spill over into issues of importance to all, including the world’s poorest. Furthermore, thinking in terms of "information governance" may make more sense in an increasingly converged sector, and issues of information governance are of undoubted importance to poor people. In turn, this suggests priorities for governments attempting to improve the lives of the poor through increasing information flows.
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Young People and ICTs in Developing Countries is forthcoming in Information Technology for Development. The paper is co-authored with Naomi Halewood. Young people are often ‘first adopters’ of new technologies, and this appears to be the case with ICTs. Evidence from the developing world suggests that young people have widespread access to broadcast technologies and the telephone, but more limited access to the Internet. And even amongst young people, Internet use lags considerably behind Internet access. ICTs, and in particular the Internet, provide opportunities for employment, but it should be noted that there are limits to the economic impact of the Internet in developing countries. Broadcast technologies can be particularly useful tool in both formal and continuing education, the Internet may have a significant role in vocational and further education. There are potential social costs of ICT use amongst young people, but these can be mitigated. Youth-specific policy recommendations focus on the greater use of ICTs in education and content control.
Charles Kenny 