Core Module IR – ALL NOTES OF ALL LECTURES (FOR 2nd EXAM)
Lecture - What is Development?
Intro:
Singapore: used to be a British colony.
Indonesia: used to be a Dutch colony.
→ In that respect same experience
But pattern of development: they couldn’t be more different.
Development in IR: economic or human development?
• Development neglected in IR, unlike security and realm of “high politics”.
- After WWII, Marshall plan (first development program), decolonization → debate
on supporting development in Global South.
- Post-Cold War rise of BRICS and diversification of IR → had something to do with
IR being interested in topics that didn’t receive a lot of attention before.
• Development as economic development
- GDP per capita = measure of quality of life based on consumption of goods and
services. (but maybe a limited view of development).
- Growth in per capita GDP as economic development.
- Cannot measure within-country inequality.
- Levels of living or standards of living? Should there be a minimum standard?
- → Criticism: it ignores other dimensions that are also important for people’s well-
being.
• Redefined as human development (Sen 1999): crucial for redefining development.
Still contains economic dimensions but adds other dimensions.
- Freedom as “the primary end and principal means of development” (Sen 1999:
42). → The absence of development (being poor) is being fundamentally unfree
and constraint.
Second point he makes: how we should get development is also through expanding
freedoms (more controversial point).
Argument: in democratic countries you never had famines/masses of people dying
from hunger, because famines are fundamentally a political problem.
- Freedom from deprivation like hunger or early death.
- Freedom to literacy and numeracy.
- Freedom of participation, association and speech.
• Considers inequality and psychological dimensions of poverty. Ex.(from another
chapter): household-level data on income → those indicators can be problematic
, because they tell you nothing about within household inequality (how do you know if
the women get anything or that the female children are send to school?).
• Human development index (UNDP): the UN has incorporated Sen’s idea of human
development.
- Long and healthy life
- Being knowledgeable
- Decent standard of living
• HDI omits political freedoms. → maybe because it’s too controversial (many
countries that are included are not democratic at all). Maybe difficult to measure it
(not very convincing, because number of indicators for this).
Empirical patterns:
Slide 15. Development in different world regions. For a long time there wasn’t much
development anywhere until the 40’s/50’s.
Slide 16: Human development. OECD/Western Countries by far doing the best. Latin-
America and Eastern Europe other regions that are doing fairly well.
Slide 19: comparing economic development (GDP/capita) with life expectancy at birth (one
dimension of human development) and we see how good the correlation is between these
two.
The puzzle of development
• Geography vs. institutions
- Debate about relative importance
- Geography and climate as exogenous → meaning that it is a precondition (you
cannot change your geography)
- Institutions are human made
• Geography (Diamond 1997, Sachs 2001)
- Proximity to coastline (seaboard or landlocked, cut off from international trade).
- Climate (temperate or tropical. About how agricultural works. More technological
advancement in agricultural production in more temperate areas, they had a
technological advantage that tropical areas didn’t).
- “Tropical agriculture faces several problems that lead to reduced productivity of
perennial crops in general and of staple food crops in particular. The burden of
infectious disease is similarly higher in the tropics than in the temperate zones.”
(Sachs 2000).
, - “A people with very intense culture, (…) by nature with warm sunshine and
bananas and coconuts, and therefore not with the same need to strive so hard.”
(Lee Kwan Yew, 1965).
• Institutions
- Institutions = organizations or rules that constrain and influence human behavior
(remember Rodrik→ non-market institutions are crucial for capitalism).
- Domestic institutions:
Protection of property rights (North 1990)
Checks on political power (Acemoglu and Robinson 2012).
There are also empirical examples of countries that grow successfully while also
restricting political freedoms (China = obvious example).
- Geography could still matter, but institutions can offset disadvantages. → When
we think about landlocked countries having fundamental disadvantages → look
at Switzerland to see that that doesn’t have to be the case.
- Where do god or bad institutions come from?
European colonialism (next lecture)
Resource wealth → could also be connected with worse institutional outcomes
(resource curse argument).
Singapore vs. Indonesia
• How can we explain divergent patterns of development?
• What should the Indonesian government do?
→ They both had authoritarian backgrounds.
In terms of beneficial geographic conditions (close to trade routes) they are almost identical.
Development policies
• Classical approaches:
- Modernization theory
- Dependency theory
- Neoclassical approach
• Evolution of development thinking:
- Neoinstitutionalist approaches
, Modernization theory (Rostow 1960)
Inspired by economic liberalism
- Anti-Communist manifesto
- Five stages of development. Idea was that development of European countries
could be replicated in poor countries.
- Interventional investment and infusion of ideas to facilitate take-off.
- Policy implications?
• Critiques: narrow focus on capital accumulation, teleological, ahistorical, empirical
failure → countries that followed these stages but were unsuccessful (Ex.: Green
Revolution India).
• Dependency theory:
- Scholars from Global South (Mainly Latin American Scholars,Amin, Cardoso, Dos
Santos, Faletto, Prebisch)
- Exogenous “development of underdevelopment” (Baran 1957)
- Structural lock-in of exploitation and unequal exchange with periphery
- Decline terms of trade (Singer-Prebisch thesis) → the prices of raw materials
decline faster than prices of manufactured goods which developing countries
have to import and they have to import technology to be able to industrialize. So
developing countries are increasingly put at a disadvantage.
- Internalization of imperialism by domestic elites (Evans 1979). → maintaining this
unequal exchange relations.
- Policy implications? → What should developing countries do? They should limit
their dependence on global market as much as possible and cut them selves of
from this unequal exchange and try to develop on their own. Ex.: Latin-American
countries did this called “import substitution industrialization (ISI)”: wanted to
industrialize on their own without having these unequal conditions. → This was
unsuccessful.
- Critique: Overestimate North-South trade (there was mainly North-North trade),
role of domestic state seeking rents, empirical failure (ex.: Latin-American
products that were created (cars) never became successful on the global market).
• Neoclassical approach and Washington consensus
- W.C. was designed to help Latin American countries who were facing depth crisis
after experimenting with ISI. After Cold War: International organizations started
to apply the W.C. much more broadly.
- Approach is linked to Economic liberalism, limited role of state.
Lecture - What is Development?
Intro:
Singapore: used to be a British colony.
Indonesia: used to be a Dutch colony.
→ In that respect same experience
But pattern of development: they couldn’t be more different.
Development in IR: economic or human development?
• Development neglected in IR, unlike security and realm of “high politics”.
- After WWII, Marshall plan (first development program), decolonization → debate
on supporting development in Global South.
- Post-Cold War rise of BRICS and diversification of IR → had something to do with
IR being interested in topics that didn’t receive a lot of attention before.
• Development as economic development
- GDP per capita = measure of quality of life based on consumption of goods and
services. (but maybe a limited view of development).
- Growth in per capita GDP as economic development.
- Cannot measure within-country inequality.
- Levels of living or standards of living? Should there be a minimum standard?
- → Criticism: it ignores other dimensions that are also important for people’s well-
being.
• Redefined as human development (Sen 1999): crucial for redefining development.
Still contains economic dimensions but adds other dimensions.
- Freedom as “the primary end and principal means of development” (Sen 1999:
42). → The absence of development (being poor) is being fundamentally unfree
and constraint.
Second point he makes: how we should get development is also through expanding
freedoms (more controversial point).
Argument: in democratic countries you never had famines/masses of people dying
from hunger, because famines are fundamentally a political problem.
- Freedom from deprivation like hunger or early death.
- Freedom to literacy and numeracy.
- Freedom of participation, association and speech.
• Considers inequality and psychological dimensions of poverty. Ex.(from another
chapter): household-level data on income → those indicators can be problematic
, because they tell you nothing about within household inequality (how do you know if
the women get anything or that the female children are send to school?).
• Human development index (UNDP): the UN has incorporated Sen’s idea of human
development.
- Long and healthy life
- Being knowledgeable
- Decent standard of living
• HDI omits political freedoms. → maybe because it’s too controversial (many
countries that are included are not democratic at all). Maybe difficult to measure it
(not very convincing, because number of indicators for this).
Empirical patterns:
Slide 15. Development in different world regions. For a long time there wasn’t much
development anywhere until the 40’s/50’s.
Slide 16: Human development. OECD/Western Countries by far doing the best. Latin-
America and Eastern Europe other regions that are doing fairly well.
Slide 19: comparing economic development (GDP/capita) with life expectancy at birth (one
dimension of human development) and we see how good the correlation is between these
two.
The puzzle of development
• Geography vs. institutions
- Debate about relative importance
- Geography and climate as exogenous → meaning that it is a precondition (you
cannot change your geography)
- Institutions are human made
• Geography (Diamond 1997, Sachs 2001)
- Proximity to coastline (seaboard or landlocked, cut off from international trade).
- Climate (temperate or tropical. About how agricultural works. More technological
advancement in agricultural production in more temperate areas, they had a
technological advantage that tropical areas didn’t).
- “Tropical agriculture faces several problems that lead to reduced productivity of
perennial crops in general and of staple food crops in particular. The burden of
infectious disease is similarly higher in the tropics than in the temperate zones.”
(Sachs 2000).
, - “A people with very intense culture, (…) by nature with warm sunshine and
bananas and coconuts, and therefore not with the same need to strive so hard.”
(Lee Kwan Yew, 1965).
• Institutions
- Institutions = organizations or rules that constrain and influence human behavior
(remember Rodrik→ non-market institutions are crucial for capitalism).
- Domestic institutions:
Protection of property rights (North 1990)
Checks on political power (Acemoglu and Robinson 2012).
There are also empirical examples of countries that grow successfully while also
restricting political freedoms (China = obvious example).
- Geography could still matter, but institutions can offset disadvantages. → When
we think about landlocked countries having fundamental disadvantages → look
at Switzerland to see that that doesn’t have to be the case.
- Where do god or bad institutions come from?
European colonialism (next lecture)
Resource wealth → could also be connected with worse institutional outcomes
(resource curse argument).
Singapore vs. Indonesia
• How can we explain divergent patterns of development?
• What should the Indonesian government do?
→ They both had authoritarian backgrounds.
In terms of beneficial geographic conditions (close to trade routes) they are almost identical.
Development policies
• Classical approaches:
- Modernization theory
- Dependency theory
- Neoclassical approach
• Evolution of development thinking:
- Neoinstitutionalist approaches
, Modernization theory (Rostow 1960)
Inspired by economic liberalism
- Anti-Communist manifesto
- Five stages of development. Idea was that development of European countries
could be replicated in poor countries.
- Interventional investment and infusion of ideas to facilitate take-off.
- Policy implications?
• Critiques: narrow focus on capital accumulation, teleological, ahistorical, empirical
failure → countries that followed these stages but were unsuccessful (Ex.: Green
Revolution India).
• Dependency theory:
- Scholars from Global South (Mainly Latin American Scholars,Amin, Cardoso, Dos
Santos, Faletto, Prebisch)
- Exogenous “development of underdevelopment” (Baran 1957)
- Structural lock-in of exploitation and unequal exchange with periphery
- Decline terms of trade (Singer-Prebisch thesis) → the prices of raw materials
decline faster than prices of manufactured goods which developing countries
have to import and they have to import technology to be able to industrialize. So
developing countries are increasingly put at a disadvantage.
- Internalization of imperialism by domestic elites (Evans 1979). → maintaining this
unequal exchange relations.
- Policy implications? → What should developing countries do? They should limit
their dependence on global market as much as possible and cut them selves of
from this unequal exchange and try to develop on their own. Ex.: Latin-American
countries did this called “import substitution industrialization (ISI)”: wanted to
industrialize on their own without having these unequal conditions. → This was
unsuccessful.
- Critique: Overestimate North-South trade (there was mainly North-North trade),
role of domestic state seeking rents, empirical failure (ex.: Latin-American
products that were created (cars) never became successful on the global market).
• Neoclassical approach and Washington consensus
- W.C. was designed to help Latin American countries who were facing depth crisis
after experimenting with ISI. After Cold War: International organizations started
to apply the W.C. much more broadly.
- Approach is linked to Economic liberalism, limited role of state.
