What if NCAA Basketball Tournament Teams were coached by Development Economists?

Tomorrow night is the next round of March Madness, the annual NCAA tournament that started off with 64 college basketball teams, now reduced to the "Sweet Sixteen" . It is not widely known that some lower seeded teams in the tournament, who had to play much better teams, desperately sought advice from leading Development Economists.

A Columbia Professor said we already know the successful ingredients for a championship, just get lots of funding for the inputs to a victory. Each of his players was given a beautfiul new basketball but had no incentive to pass it or shoot it.

An Oxford Professor distributed “peacekeeping equipment” to his team, saying it was critical for his Good Team backed by the UN Security Council and the G-7 to win. The other team fled in panic, but was declared the winner by default by tournament officials.

An NYU Professor said a lower seed had never won the tournament and he saw no reason why it would be possible now. He and his team left for a vacation in Cancún.

Other Professors such as Duflo, Banerjee, and Karlan set up randomized trials for which plays work. Treatments included 3-point shots, driving layups, pick and roll, and passing to the open player, compared to a control group holding the ball still. The results were of considerable interest, but players got very confused trying to remember which study to cite and apply in each pressure-packed moment of the game. They did not make the Sweet Sixteen.

Hernando de Soto said the only thing that mattered was property rights. He called for secure titles to his team's land. This team defended its own half-court successfully, but they were forced to recognize the other team's rights also. There was not a lot of scoring.

Mohammed Yunus said it's all about microcredit. He suggested empowering his team's players with micro loans. This was a great success, as players all left the court to start small businesses selling beer and pretzels in the stands.

Finally,the team asking advice from George Mason Professor of Economics Peter Boettke made a Cinderella run into the Sweet Sixteen. What was his brilliant economics advice? Well, he chose not to give any, but he had actually played and coached basketball in high school and college.

Were the above characterizations inaccurate? Everybody can participate in the usual heavy betting on this tournament -- fill out your own brackets below to determine who will advance to the semifinals and then the finals, and who the final winner will be.

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Dear UK Government, why won't you let me retire as Official Sachs Critic?

UPDATE 3: FEB 8 4:50PM: Twitter War reveals that Millennium Village Blog accused Clemens and Demombynes of hard hearts towards suffering (search the blog for "suffering"). UPDATE 2: FEB 8 4:30PM: concluding coverage by @PSIHealthyLives @viewfromthecave of the Great Twitter War prompted by this post between @aidwatch and @earthinstitute, with collateral attacks on @m_clem, ending in a non-acceptance of debate by head of @earthinstitute.

UPDATE Feb 8 11:30am: sent comment with link to this post to DFID Independent Commission for Aid Impact. Spokesperson promptly responded, rejected my comment for consideration on technical grounds, but did warmly invite me to complete the anonymous online mass Survey Monkey. It probably doesn't mean much, unless the Independent Commission already learned the brilliant strategy of bureaucratizing the critics? I do feel a wee bit sorry for one of your Commisioners, the great John Githongo, who presumably did not risk his life so he could be reading anonymous results from Survey Monkey.

Nobody is more tired of the interminable Sachs-Easterly debate than one guy named Easterly...alas, I seem to be stuck in a kind of Critic Trap, in which the ideas criticized keep reappearing unchanged, requiring equally unchanged criticisms, keeping me in chronic peril of taking myself way too seriously.

So it was with great weariness I heard the news that the British aid agency DFID (otherwise probably the best bilateral aid agency) is close to financing a brand new Millennium Village in northern Ghana, near Bolgatanga. I had hoped for something better from the new UK government, which had seemed like an improvement over the Blair and Brown ("We know the answers, just double aid") team .

As it happened, I passed by the proposed MVP site last summer. The proposed villages are right on the main road in one of the most NGO-intensive places anywhere (see the sign below, in which NGOs apparently own the region).

The usual critique that selection bias of the Millennium Villages makes evaluation  impossible may be somewhat relevant given the political realities that (1) the current government chose the villages for the MVP, (2) the incumbents have frequently promised to do more for the North, (3) the MVP came along and may be a high visibility way to keep that promise, and (4) ergo, the government will likely do everything possible to make the project succeed, showing nothing about scalability for thousands of villages elsewhere. In short, this new MV may be about as informative as my feeding my own children is informative on whether child nutrition programs work.

And how good is the track record of the MVP taking evaluation seriously? Michael Clemens and Gabriel Demombynes posted the following on the World Bank Africa blog last Friday:

In a June 2010 report called Harvests of Development, the Project claimed that the impacts of the project included expanded cell phone ownership.  For example, the MVP claimed that increases in cell phone ownership at the Ghana site were caused by the project, in this extract from page 91 of the MVP report:

This claim has little basis, because cell phone ownership has been expanding at about the same rate all around the MVP site in areas untouched by the project. ....

But on Tuesday, months after multiple discussions we’ve had with MVP leaders on our research, a post on the MVP’s blog restated the claim that the increase in mobile phone ownership at the intervention sites was caused by the Project...

{The Clemens and Demombynes paper does the same cell phone analysis with the same results in the MV of Sauri, Kenya.}

They were responding to a blog post on the MVP web site on February 2, 2011 as follows:

Sauri looks back on five years of success

Infrastructure: ... The proportion of households owning a mobile phone has increased four-fold....

In short, independent observers made an irrefutable argument that a claim was invalid, the MVP heard the argument, seemed to accept it, and then repeated the previous claim unchanged.

Or in other words, if nobody is listening to any evaluations anyway, if I am bored and I am boring everyone else, why should I want to be Official Sachs Critic any longer?

Messrs. Clemens and Demombynes, you may want to check out a new job opening...

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Eyes Wide Shut: Philanthropy Action on the "Rescheduled" Sachs vs. Clemens/Demombynes debate

Tim Ogden at Philanthropy Action issues a petition for the "rescheduled" (quotes in original) Sachs vs. Clemens/Demombynes debate on evaluating Millennium Villages, which was supposed to happen last Wednesday, to be indeed, well, rescheduled.

He asks for all of us to be watching whether this indeed happens. Aid Watch is always in favor of more Watching, so we support Tim's petition.

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The Millennium Development Goal that really does work has been forgotten

UPDATE 12 noon: this  is a dueling oped with Sachs on ft.com, debate has moved on and even some agreement (see end of post) from a column in the on-line Financial Times today ; for ungated access and a picture of the handsome author go here. The Millennium Development Goals tragically misused the world’s goodwill to support failed official aid approaches to global poverty and gave virtually no support to proven approaches. Economists such as Jeffrey Sachs might argue that the system can be improved by ditching bilateral aid and moving towards a “multi-donor” approach modelled on the Global Fund to Fight Aids, Tuberculosis and Malaria. But current experience and history both speak loudly that the only real engine of growth out of poverty is private business, and there is no evidence that aid fuels such growth.

Of the eight goals, only the eighth faintly recognises private business, through its call for a “non-discriminatory trading system”. This anodyne language refers to the scandal of rich countries perpetuating barriers that favour a tiny number of their businesses at the expense of impoverished millions elsewhere. Yet the trade MDG received virtually no attention from the wider campaign, has seen no action, and even its failure has received virtually no attention in the current MDG summit hoopla.

This is all the more misguided because trade-fuelled growth not only decreases poverty, but also indirectly helps all the other MDGs. Yet in the US alone, the violations of the trade goal are legion. US consumers have long paid about twice the world price for sugar because of import quotas protecting about 9,000 domestic sugar producers. The European Union is similarly guilty.

Equally egregious subsidies are handed out to US cotton producers, which flood the world market, depressing export prices. These hit the lowest-cost cotton producers in the global economy, which also happen to be some of the poorest nations on earth: Mali, Burkina Faso and Chad.

According to an Oxfam study, eliminating US cotton subsidies would “improve the welfare of over one million West African households – 10 million people – by increasing their incomes from cotton by 8 to 20 per cent”.

Brahima Outtara, a small cotton farmer in Logokourani, Burkina Faso, described the status quo to the aid agency a few years ago: “Cotton prices are too low to keep our children in school, or to buy food and pay for health.”

To be fair, the US government has occasionally tried to promote trade with poor countries, such as under the African Growth and Opportunity Act, a bipartisan effort over the last three presidents to admit African exports duty free. Sadly, however, even this demonstrates the indifference of US trade policy towards the poor.

The biggest success story was textile exports from Madagascar to the US – but the US kicked Madagascar out of the AGOA at Christmas 2009. The excuse for this tragic debacle was that Madagascar was failing to make progress on democracy; an odd excuse given the continued AGOA eligibility of Cameroon, where the dictator Paul Biya has been in power for 28 violent years. Angola, Chad and even the Democratic Republic of the Congo are also still in. The Madagascan textile industry, meanwhile, has collapsed.

In spite of all this, the great advocacy campaign for the millennium goals still ignores private business growth from trade, with a few occasional exceptions such as Oxfam. The burst of advocacy in 2005 surrounding the Group of Eight summit and the Live 8 concerts scored a success on the G8 increasing aid, but nothing on trade.

The UN has continuously engaged US private business on virtually every poverty-reducing MDG except the one on trade that would reduce poverty-increasing subsidies to US private business. And while the UN will hold a “private sector forum” on September 22 as part of the MDG summit, the website for this forum makes no mention of rich country trade protection.

The US government, for its part, announced recently its “strategy to meet the millennium development goals”. The proportion of this report devoted to the US government’s own subsidies, quotas and tariffs affecting the poor is: zero. News coverage reflects all this – using Google News to search among thousands of articles on the millennium goals over the past week, the number that mention, say, “cotton subsidies” or “sugar quotas” is so far: zero.

It is already clear that the goals will not be met by their target date of 2015. One can already predict that the ruckus accompanying this failure will be loud about aid, but mostly silent about trade. It will also be loud about the failure of state actions to promote development, but mostly silent about the lost opportunities to allow poor countries’ efficient private businesspeople to lift themselves out of poverty

UPDATE: this was a dueling piece with an oped by Sachs today on FT.com.

One of us also got a prestigious slot in the print edition of FT :>)

Surprising new agreement with Sachs, where he says:

{Bilateral aid doesn't work because it's} "largely unaccountable," "programmes are scattered among many small efforts," {and it creates mainly an} "endless spectacle of visiting dignitaries from donor countries."

Continuing disagreement with Sachs when he says:

The most exciting example {of success} is the Global Fund to Fight Aids, TB and Malaria. ...while a decade ago all three diseases were running out of control, now all are being reined in with millions of lives saved.

Jeff, could you clarify a bit what you mean saying that AIDS is "being reined in" when for every 100 people added to AIDS treatment, 250 people are newly infected with HIV?

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Jeff Sachs’ intellectual empire gets new funding

There’s a new way to study development: a masters degree in the practice of development. The MacArthur Foundation announced ten universities to receive funding for the new degree program yesterday, bringing the funding from MacArthur for this project to $16 million. The first students matriculated at Columbia University in 2009, and by 2013 the foundation expects the programs to be producing 400 graduates a year from around the world.

The two-year degree is multidisciplinary—the health sciences, the natural sciences and engineering, the social sciences, and management—with a focus on application and fieldwork.

Since today’s problems—like climate change, poverty and sustainable development—are interconnected, students need to be prepared to think across disciplines, so the argument goes. If ending global hunger (Millennium Development Goal number one) requires technical knowledge of health and nutrition, agronomy, agricultural supply systems, as well as managing organizational change, then this degree proposes to equip graduates with basic knowledge on all those topics.

The idea for the new global program comes from the Earth Institute’s Jeffrey Sachs, an architect of the Millennium Development Goals, and John McArthur, the head of the NGO that supports the Millennium Village Project, who articulated their vision in a 2008 report on education for development professionals.

Here’s what this program assumes the world needs more of:

a new generation of development practitioners who can understand the “languages” and practices of many specialties, and who can work fluidly and flexibly across intellectual and professional disciplines and geographic regions.

This sounds pretty good. In fact, I’m a generalist myself, which is how I ended up in this job, where I write about a global health issue one day and an economics paper the next.

But what if what the world really needs more of something else? What if it needs more specialists, more people with deep knowledge about the regions they study and work in? What if it needs people who are well-versed enough in their own disciplines to be critical of half-baked development ideas cooked up by aid planners who know just enough about every topic to believe they have the answers?  What if the world needs more specialists to evaluate the quality of the work in each specialty?

Curriculum and course materials proposed by the central “Secretariat” for development practice are housed in Columbia’s Earth Institute. Will the new programs produce students with a standardized, narrowly-prescribed view of how to approach development problems? Or will the melding of disciplines encourage critical thinking and help straddle the theory-policy divide, making global cooperation run more smoothly and international aid more effective?

I hope it’s the latter. But here’s one discouraging clue: The draft 2009 syllabus for the development practice degree’s required “foundation course,” offered at Columbia and several other universities around the world through web conferencing, reads like a synopsis of the degree itself. And all the readings for the course’s introductory week, the week devoted to foreign aid and policy, and the week on the Millennium Villages Project are authored by either Jeff Sachs, John McArthur, the Millennium Villages Project scientists, or the UN.

Hat tip to Michael Clemens.

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Criticism of Sachs video withdrawn

The links in our post Another blog criticizes a video by a certain famous economist have gone dead, and the critical post on the other blog site has been deleted.  They made this statement in direct communication:

The original post author has deleted the post, finding his words a bit too harsh and annoyance misplaced.

The original Sachs video, which was produced as part of a series by Ericsson,  is here.

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Another blog criticizes a video by a certain famous economist

Update 4/13/10: see Aid Watch post above From ICTWorks.org post:

Sachs has a new video out about ending global poverty, and I find it very disturbing.....Sachs (and all the white people) sitting in very nice, even posh settings, but black people are filmed from a car in poverty settings. Does that mean we can take time and get face-to-face with whites, but best to stay in the car and drive by black people quickly?

Speaking of animals, what's up with the cameos of wild animals? Are they counted in global poverty numbers? Or does Sachs feel all of Africa is zebras and giraffes?

While his narration is palatable, I am really disappointed in the video work - too many stereotypes he should know better than to promote.

The video is on the blog site.

Needless to say, any opinions expressed here are those of another blog and do not necessarily represent the opinions of Aid Watch,  its bloggers, its sponsors, or any blood relative or social acquaintance of any of the above.

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Climate Blowback: What I didn’t say was not what I didn’t mean not to say

My post criticizing Sachs on climate change got many negative responses yesterday. The main problem was that I was much too terse about an issue that people care a lot about (you should probably apply a "weekend discount" to things I post on weekends!). So some understandably jumped to conclusions about what I was saying, which were inaccurate.

Honestly, I know very little about climate change. But I do know a little bit about political economy, which offers cross-disciplinary insights to the climate change discussion. So let me try again.

What I was NOT saying:

Here’s how to solve global warming. How and whether we know man-made global warming is scientific fact (I think it is from what I have read). That I am qualified to provide any detailed guidance on climate change.

What I was saying:

There is no such thing as a neutral technocratic solution. All solutions are political. The aura of the neutral technocracy just winds up giving cover to some political interests who have their own agenda.

The poor have very, very little political power. Because of this, other things equal, they were more likely to be victims of environmental destruction in the first place. And because of this, they could still lose out in attempts to reverse environmental destruction. I am talking here about poor individuals, not about poor country governments.

Current policy discussions on global warming show little sensitivity to these political realities.

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Debating Sachs: the Next Generation

I am reluctant these days to post any criticisms of Jeff Sachs, since I know many people are tired of this never-ending back and forth. But I make an exception when my own daughter asks me to take him on. I want to protect her privacy and not involve her directly in what is at times a nasty debate, so let me just says she is a college junior who has studied and thought a lot about the environment. I have listened to her and learned a lot from her, but anything I say here is my own opinion and I don't want to or claim to represent her opinion.

Sachs' opinion column that provoked her was in the March 2010 issue of Scientific American. Sachs is impatient with the political process in the US on Climate Change and invokes the neutral technocratic solution:

Let’s hear more from the president’s science adviser, John P. Holdren, Nobel laureate energy secretary Steven Chu, the National Academy of Sciences and other authorities. The public will learn to appreciate that the scientific community is working urgently, rigorously and ingeniously to better understand the complex climate system, for our shared safety and well-being.

Except, just as in Sachs' approach to ending global poverty, there is no such thing as a neutral technocratic solution. Sachs' solution sounds instead patronizing and top-down.  Any such solution has winners and losers, and the politically powerless poor at the bottom are more likely to be among the losers  ( What about the poor in West Virginia who see their streams polluted and their mountaintops removed to get "clean coal"?)

More generally, and closer to my usual debate with Sachs: Why should the solution to global warming be decided by rich country technocrats? Is this an environmental version of the White Man's Burden, that rich country environmentalists patronizingly impose their solutions on the rest of the world?

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Who is best qualified to help Haiti? Why not the Haitian diaspora?

Toronto Globe and Mail columist Margaret Wente:

Who can offer the most help to the desperate children of Haiti? Is it Bill Clinton, Jeffrey Sachs, the World Bank or the UN? Is it the many experts who are calling for a Marshall Plan to “fix” Haiti once and for all, or the donor nations that have pledged billions for the task?

Personally, I would choose people like Eric and Nicole Pauyo. The Haitian-Canadian couple, who live in a prosperous suburb of Montreal, have taken in eight nieces and nephews left orphaned by the Jan. 12 earthquake. “I didn't think twice,” said Nicole, who's 62. The Pauyos have already raised three kids of their own. One of them is at Harvard.

For Haitians, the best way to improve their lives is to leave Haiti. More than a million Haitians now live abroad, including 100,000 in Canada. Life in Haiti, meantime, has become worse. Children go hungry, and barely a third finish primary school. About a 10th are restaveks (from the French reste avec , or stay with) – virtual child slaves who are sent to work as unpaid servants in the city by their impoverished parents....

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The Development Satire Industry Reaches New Lows: Why?

I just found out about another contribution to the exploding development satire field. It's in EXTREMELY bad taste, is often disgusting, and always features  lacerating and offensive  satire  ... therefore, some of you will LOVE it. It's based around a blog called HR International (to keep our blog's PG-13 rating, I will not at this time spell out what HR stands for).  I found out about it because I am one of the 3 people that @hreliefint is now following on Twitter, along with @jeffdsachs and @talesfromthehood (the latter tipped me off).

A sample of of the HRI blog (from the small part that is printable in a family blog):

Ed and I know a thing or two about emergency coordination as we go back to the days in Aceh, where I’ve hired him to develop HRIs fishing-boat distribution strategy, a program that is currently being monitored and evaluated by HRIs M&E wing: initial findings indicate that this program will become yet another world’s best practice. The 800,000 or so USD that have remained unspent in that program will come in handy as HRI is preparing a dignified launch of the findings report in Bali, with a mass distribution component aimed at making one M&E report available to each family in Aceh and beyond.

What accounts for the explosion in development satire? Of course,  I am as guilty as anyone.  Based on random introspection, observation of a selection-biased sample of the aid industry, and unfounded guesses, the answer is obvious:  it's because of the increase in BS in development & aid. As the BS force keeps exponentially growing, there was bound to be an opposite force of protest.

We are using the only weapon that us weak people oppressed by the BS ruling elites can use: satire. As BS keeps rising, satire is going to keep exploding in revolt. A few of us (not me)  may go over the edge to the extremes of the HRI blog. So, just to be clear, you BS'ers in aid: all this bad taste is YOUR fault.

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Jeff Sachs, welcome to Twitter!

As of 11 am today (2/26), Jeff Sachs has started posting on Twitter as @jeffdsachs. Here is some of the early traffic in which yours truly has a tiny stake (I have omitted who did the T for privacy): (anon): Just noticed that @bill_easterly is following @jeffdsachs but not vice versa / Hilarious

@bill_easterly: This hurts :>) RT  Just noticed that @bill_easterly is following @jeffdsachs but not vice versa

@jeffdsachs: Hello friends, thank you for the warm welcome.

@jeffdsachs: RT @EndOfPoverty: mobile phones and internet in Africa means changes to life in fields, in clinics,... http://fb.me/5LOwcWe

@bill_easterly: I agree w u on mobile potential RT @jeffdsachs mobile phones in Africa means changes to life in fields, in clinics,... http://fb.me/5LOwcWe

(anon): Pigs just flew!! RT @bill_easterly: Agree w u on mobile potential RT @jeffdsachs mobiles in Africa means changes to,... http://fb.me/5LOwcWe

(anon): WHAT? My entire belief system just corroded to nothing RT @bill_easterly I agree w u on mobile potential RT @jeffdsachs http://fb.me/5LOwcWe

(anon): Hell just froze over! RT @bill_easterly:I agree w/ u on mobile potential RT @jeffdsachs mobile phones in Africa (cont) http://tl.gd/c0m70

(anon): Ahem, @jeffdsachs where are you? The whole developmentgeek twittersphere is waiting for you to reply to @bill_easterly

OK let's remain calm. It's only been one hour, and Professor Sachs may have a less compulsive/healthier relationship with his iPhone/Crackberry than some of the rest of us.

*&^$#@%*()^% I just burnt the cookies, gotta go.

UPDATE: 3/1/10 8:16am: another T from Jeff:

@jeffdsachs: @uncultured Thank you so much for the kind words. Your project is amazing and your videos, truly inspiring. Keep up the great work! {about 21 hours ago via TweetDeck}

in response to:

@uncultured: The one who inspired me to believe we can end extreme poverty (and to start my project) is now on Twitter - @JeffDSachs #FollowFriday

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Who gets the Last Seat on the Plane? Why Aid Hates Economics

Not long ago, I was returning home from a trip when the airline bumped me from my flight due to overbooking. The airline rep was very sympathetic, but I didn’t want her sympathy, I wanted A Seat On the Plane. She had traded off my wishes against those of other passengers, and I lost. Economists are unpopular because we say there is always SOME resource that is overbooked in aid, and aid is Forced to Choose: who is going to get the Last Seat on the Plane?

Politicians and advocates try to argue their way out of the Scarcity and Tradeoffs, using one or another of these proven strategies:

(1)   There really is no scarcity

This is Sachs’ central argument for more money in aid –you should never be forced to choose who should live and who should die, so you should always ask for more aid money. This has been effective as advocacy, but still doesn’t make aid money an infinite resource – there is still a limit on how much rich people will give. And the scarce resource is not only money – it is also political capital, rich peoples’ attention, or effective and accountable aid workers in the field. So using AIDS as an example, sure you should do some of both treatment and prevention – but how much of each? In the end, they are still competing for limited Seats on the Plane.

(2)   Our project doesn’t use any scarce resources

This argument is usually made by omission. The Millennium Villages don’t advertise that they are dependent on one extremely scarce resource -- Western experts -- perhaps it would then become obvious that they are neither scalable nor sustainable. And of course there is a big tradeoff between the Millennium Villages and better projects you could do with this scarce Western expertise. A better project replaces the scarce foreign expertise very soon with more abundant local expertise and labor – such as training programs to transmit foreign technical skills to locals, who will in turn pass it on to other locals.

(3)   My cause actually is the same as your cause

Advocates of one cause often argue many other causes NEED their cause. If the necessity is absolute, then indeed the tradeoff disappears. If it is less than 100 percent absolute, there is still a tradeoff. Hey, Other Passenger who took my seat: don’t claim that You are so Important that it’s pointless for Me to get on a plane without You! Unless You are the Pilot.

In summary, there really is scarcity and aid really is forced to make intelligent choices. Be sure to give a seat to the pilot.

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An oil purse is a curse, of course?

This post is by Adam Martin, a post-doctoral fellow at DRI. In development economics everyone knows that natural resources are a curse. A well-known study by Sachs and Warner found a negative correlation between resource abundance and growth rates, while subsequent studies have shown a negative relationship with democracy.

The Curse enjoys wide appeal. Aid skeptics like that it implicates oppressive domestic government and nationalized industries. Aid supporters are drawn to its emphasis on geography (destiny!) and the indictment of global markets. And on the popular level, no one makes a better villain than oil companies. But popularity doesn't stop the story from being hot, flat, and wrong.

New research argues that empirical work on the Curse suffers from two interrelated problems. First, it uses dependence (the share of GDP from that resource) and calls it abundance (the stock of a resource in the ground). But dependence in turn depends on institutional quality—if you have sound institutions, natural resources take their place along other industries. If not, natural resources will by default constitute a large share of GDP because poor institutions stifle an advanced division of labor. When you look at cross-sectional data using dependence as a proxy for abundance, it will look like natural resources compromise institutional quality.

That reliance on cross-sectional data is the second major problem. The Curse story does not claim that Nigeria is Britain plus oil, but rather that Nigeria is less democratic than Nigeria would be in the absence of oil. One way to get around this problem is to test whether oil makes country X less democratic using panel data with fixed country effects. That’s fancy econometric speak for taking into account other factors that might make country X more or less democratic—its history, institutions, culture, etc. Fixed effects also allow testing a corollary of the Curse known as the "First Law of Petropolitics": as oil prices go up, oil-rich autocrats crack down on democracy even more.

Digging into the recent research:

  • Christa Brunnschweiler and Erwin Bulte tackle the first problem. They find a positive correlation between resource abundance and both growth and institutional quality, and argue that it is conflict and poor institutional quality that lead to dependence.
  • Stephen Haber and Victor Menaldo offer a great review of the second problem. They present evidence that even natural resource dependence does not undermine democratization.
  • Romain Wacziarg corrects for both problems, testing for the effects of high oil prices on democracy using panel data. Again, there is no evidence for the Curse.

These studies argue that, while the Curse is plausible, domestic institutions are simply too persistent for it to matter much. Will belief in the Curse likewise prove too persistent in the face of new and better evidence?

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Democracy and development look different from inside a jail cell

One of my most inspirational experiences lately was to meet with an African democratic opposition leader whom I had long admired from afar. He earned his credentials the hard way -- he spent years in jail under the dictatorial government of his country.

While in jail, he read the foreword to one extremely popular book on The End of Poverty. The author thanked the dictator who had jailed the opposition leader for the dictator's "help and guidance" on the book, naming this same autocrat as one of "Africa's new generation of democratic leaders."

He also was not a big fan of statistical regressions that tell poor people when they are allowed to have democratic rights. He can't understand why there's a double standard: real democracy for rich countries, yet doubts about whether poor societies deserve to be free. Not to mention active support of aid organizations for authoritarian leaders. One aid organization gave their representative an award for creative financing of this same dictator while this opposition leader was in jail.

He knew that I am  in favor of democracy for poor nations, and he encouraged me to do better at making that case, partly on idealistic grounds and partly on pragmatic ones. I feel like I have let him down by not making more progress on this longstanding debate.

I am keeping the country and opposition leader unspecified, for fear of further harassment of this courageous activist by his country's "new generation of democratic leader."

Coincidentally, I read today a superb article by Carl Schramm on democracy and capitalism in the Fall 2009 Claremont Review of Books (alas the article itself is not available online). Among other things, Schramm takes down Thomas Friedman for his book "Hot, Flat, and Crowded."  Schramm says:

This is what happens in free market democracies, Friedman tells us -- an unacceptable mess ensues when there are no expert overseers to direct our affairs.

According to Schramm, Friedman's ideal system seems to be if

intellectual elites could rule us in a benign autocracy. And it likely would be benign, because intellectuals are ... so nice.

You can keep all your experts, I'll take one real democratic opposition leader anyday.

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Do Millennium Villages work? We may never know

Jeffrey Sachs’ Millennium Villages Project has to date unleashed an array of life-saving interventions in health, education, agriculture, and infrastructure in 80 villages throughout ten African countries. The goal of this project is nothing less than to “show what success looks like.” With a five-year budget of $120 million, the MVP is billed as a development experiment on a grand scale, a giant pilot project that could revolutionize the way development aid is done.

But are they a success? To address that question, we need to know: What kind of data is being collected? What kinds of questions are being asked? Three years into the start of one of the highest-profile development experiments ever, who’s watching the MVPs?

The most comprehensive evaluation of the project published so far is a review by the Overseas Development Institute, a large UK-based think tank. The review covered two out of four sectors, in four out of ten countries, with data collected in the MVs only, not in control villages. The report’s authors cautioned that “the review team was not tasked and not well placed to assess rigorously the effectiveness and efficiency of individual interventions as it was premature and beyond the means of the review.”

Despite this, a Millennium Villages blog entry on Mali says, “With existing villages showing ‘remarkable results,’ several countries have developed bold plans to scale up the successful interventions to the national level.” Millennium Promise CEO John McArthur described Sachs’ recent testimony to the Senate Foreign Relations Committee: “Sachs noted the success of the Millennium Villages throughout Africa and the tremendous development gains seen in the project over the past three years.”

The Evaluation that Isn’t?

In contrast, evaluation experts have expressed disappointment in the results they’ve seen from the Millennium Villages Project to date. This isn’t because the MVPs fail to produce impressive outcomes, like a 350 percent increase in maize production in one year (in Mwandama, Malawi), or a 51 percent reduction in malaria cases (in Koraro, Ethiopia). Rather, it has to do with what is—and is not—being measured.

“Given that they’re getting aid on the order of 100 percent of village-level income per capita,” said the Center for Global Development’s Michael Clemens in an email, “we should not be surprised to see a big effect on them right away. I am sure that any analysis would reveal short-term effects of various kinds, on various development indicators in the Millennium Village.” The more important test would be to see if those effects are still there—compared with non-Millennium Villages—a few years after the project is over.

Ted Miguel, head of the Center of Evaluation for Global Action at Berkeley, also said he would “hope to see a randomized impact evaluation, as the obvious, most scientifically rigorous approach, and one that is by now a standard part of the toolkit of most development economists. At a minimum I would have liked to see some sort of comparison group of nearby villages not directly affected by MVP but still subject to any relevant local economic/political ‘shocks,’ or use in a difference-in-differences analysis.” Miguel said: “It is particularly disappointing because such strong claims have been made in the press about the ’success’ of the MVP model even though they haven't generated the rigorous evidence needed to really assess if this is in fact the case.”

An MVP spokesperson told me that they are running a multi-stage household study building on detailed baseline data, the first results from which will be published in 2010. The sample size is 300 households from each of the 14 MV “clusters” of villages (which comprise about 30,000-60,000 people each.) She also said that their evaluation “uses a pair-matched community intervention trial design” and “comparison villages for 10 MV sites.”

But Jeff Sachs noted in a 2006 speech that they were not doing detailed surveying in non-MV sites because—he said— “it’s almost impossible—and ethically not possible—to do an intensive intervention of measurement without interventions of actual process.” A paper the following year went on to explain that not only is there no selection of control villages (randomized or otherwise), there is also no attempt to select interventions for each village randomly in order to isolate the effects of specific interventions, or of certain sequences or combinations of interventions.

CEO John McArthur declined to comment on this apparent contradiction. The MVP spokesperson could say only that the evaluation strategy has evolved, and promised a thorough review of their monitoring and evaluation practices in 2010.

Comparison villages could be selected retroactively, but the MVP has failed to satisfactorily explain how they chose the MVs, saying in documents and in response to our questions only that they were “impoverished hunger hotspots” chosen “in consultation with the national and local governments.” If there was no consistent method used in selecting the original villages (if politics played a role, or if villages were chosen because they were considered more likely to succeed), it would be difficult to choose meaningful comparison villages.

Living in a Resource-Limited World

Imagine that you are a policymaker in a developing country, with limited resources at your disposal. What can you learn from the Millennium Villages? So far, not very much. Evaluations from the MVP give us a picture of how life has changed for the people living in the Millennium Villages, and information about how to best manage and implement the MVP.

Sandra Sequeira, an evaluation expert at London School of Economics, sums up the quandary neatly. “Their premise is that more is always better, i.e. more schools, more clinics, more immunizations, more bed nets. But we don't live in a world of unlimited resources. So the questions we really need to answer are: How much more? Given that we have to make choices, more of what?”

These are tough questions that the Millennium Villages Project will leave unanswered. For a huge pilot project with so much money and support behind it, and one that specifically aims to be exemplary (to “show what success looks like”), this is a disappointment, and a wasted opportunity.

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The 50th Anniversary of The Answer: Muddling Through

John Kay in the Financial Times today celebrates the 50th anniversary of a classic article by the American political scientist Charles Lindblom, column in the New York Times last week about agricultural aid (Sachs seems to have at least briefly returned to aid after a prolonged foray into global warming and commenting on rich country macroeconomic policy vis-à-vis the Crash). A bit of the “root” planning method seems evident:

The {aid} recipient countries should be invited to prepare plans and budgets that would be reviewed by independent experts. These plans would describe the inputs needed by the farmers, the expected increase in production, how the strategy would be put into place and how much money would be required.

So I guess Professor Lindblom’s battle is still not yet won. I salute the 92-year-old Professor Lindblom, and hope he is hearing about some of the 50th anniversary celebrations by his many fans.

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