Thursday, November 11, 2010

Climate Change: Drought in Ethiopia


“A boy stands in a dried up pond near Moyale in the lowlands of Ethiopia's Oromiya zone. A devastating drought has left an estimated 737,000 Ethiopians struggling to survive without access to clean water. Beyond Ethiopia, the drought has spread out to affect more than 8.3 million people, including 1.2 million children aged under five, across the Horn of Africa.”


“One of thousands of goat carcasses at Goraye in Oromiya region.”

Photo credit: Andrew Heavens, Flickr

Migrant networks and FDI

Although there exists a sizeable literature documenting the importance of ethnic networks for international trade, little attention has been devoted to studying the effects of migrants on foreign direct investment (FDI). The presence of migrants can stimulate FDI by promoting information flows across international borders and by serving as a contract enforcement mechanism. This paper investigates the link between the presence of migrants in the US and US FDI in the migrants' countries of origin, taking into account the potential endogeneity concerns. The results suggest that US FDI abroad is positively correlated with the presence of migrants from the host country. The data further indicate that the relationship between FDI and migration is stronger for migrants with tertiary education.

Full paper here. Here is a draft version

Development workers: Educate thyself first!

"A long time ago, this reporter was attending a gram sabha in Madhya Pradesh when some field coordinators from the MP Rural Livelihoods Project (MPRLP), a joint venture between DFID and the state government , walked in. What followed was educative. They came in late.

Got aggressive when villagers alluded to the delay. Lectured the villagers on how they should stop relying on the government for everything. And on how they should create a central pool of cash, with each family contributing.`10 or so every month or week, and lend that out to whoever needs cash. That, said one coordinator , would reduce dependence on moneylenders.

This stunning suggestion betrayed the fact that the coordinators saw villages as united communities sans power dynamics. On the whole, the gram sabha threw up epiphanies. How could the team so freely dole out ignorant homilies on how to improve the village? How do they view the villagers in this part of the country? Like idiot children? And why were they getting away with all this preaching?

The event made one feel pessimistic about the developmental process. In that gram sabha, MPRLP fared poorly on three parameters — accountability, local understanding and respect for the villagers. And this critique can be extended across the entire ‘development mafia’ — starting from multilateral donors like the World Bank, their JVs with Indian central and state governments, India's gazillion NGOs and MFIs.

Nice article in The Economic Times. By quoting James Scott, the author alludes that this kind of incident is happening because of a “high modernist ideology”, which is “a technocratic belief that science (or other development interventions) can and will make the world a better place.” Development agencies often fail to take into account the role of practical local knowledge, informal processes, and improvisation in the face of unpredictability. The incident described in the article is nothing new.

Similar stories have been pointed out multiple times by aid critics. They have a point, but still they are missing other point by repeatedly arguing for more decentralized system and local ownership to the grind (usually comes from those that are ideologically opposed to the very concept of intervention). But, what if the intervention by locals in their own locality for development purpose yields sub-optimal result and they believe that this is the best optimal point (usually happens when you don’t have a point of reference, resulting in a situation where the most ignorant people feel that they are the most sagacious ones)? Educating them on what is optimal might need an intervention. If that is done, then the process of getting to that optimal point through whatever intervention by locals should be left to the locals themselves. Intervention should clear coordination failures and remove structural hurdles that the locals cannot remove by themselves. Sounds like lecturing? Sorry, I will stop here.