Relationship between development and freedom

Sen, A (2001). Development as Freedom. Oxford. Oxford University Press. Chapter 1.

The author conceptualizes development as ‘the gap between an exclusive concentration on economic wealth and a broader focus on the lives we can lead’ (p.14) emphasizing that the theory of development goes well beyond wealth accumulation and gross national product growth. The chapter examines the relationship between development and freedom, the way in which freedom is a component of development and an extensive view of ‘freedom’ encompassing both opportunities that people have and processes that allow for ‘freedom’ of decisions.

The main arguments of the author is that development should be assessed by ‘freedom’ of accessibility to factors such as social opportunities, health care, clean water, economic security, civil rights and political freedom. Lack of accessibility means ‘unfreedom’. Development therefore should mean that people can live the lives they want to live and precisely, how can a nation say in all entirety that it has ‘freedom’ when its citizens cannot afford the very basic necessities of life or fulfill the rights they are entitled to?

Sen goes on further to compare different views of poverty in both developing and developed nation by analyzing ‘freedoms’ through values, poverty and inequality, income and mortality, markets and freedom, tradition and culture. The author sees the process of development beyond economic growth or physical and human capital and concludes by linking the understanding of a broad view of the development process to the substantive ‘freedoms’ of people.

Sen’s write up contains intriguing views but he hasn’t mentioned what justifies his classification into these ‘freedoms’ i.e. experience of developing countries, factual historical evidence or how far ‘freedom’ has progressed within each context he identified. His definition is quite different from Rapley’s in which Rapley describes development as “more concerned with flexibility and adaptability” (Rapley 2007 pp 5) and so raises a question. Can development be measured only by individual happiness without economic growth and stability? Happiness, in my opinion is geared more towards Rapley’s definition and should be adapted into the process of economic growth.

Willis, K. (2005) Theories and Practices of Development. London. Routledge. p. 32-42.

Willis’ chapter 2 of theories and practices of development analyses development theories and practices and how these theories were attached to the economic, social and political theories that developed in Europe from the 18th century. Willis’s interpretation raises some interesting facts about historical development of theories and she divides her study into various theories.

The classical economists such as David Ricardo, an advocate of free trade and Adam Smith, in his famous book, Wealth of Nations ‘responded to the trade focus of economic policy at that time’ (p.32) when trade was a major factor of economic growth. Here, protectionist measures such as high tariffs were highly used by merchants.

Willis goes on to say Adam Smith was not in favour of this form of regulation and that it was harmful to the country’s economic growth. Instead, greater focus on production and division of labour which will be regulated by the ‘invisible hand of the market’ (p.33).

The Great depression of the 1930’s and other economic happenings gave rise to Keynes argument of the free market not necessarily a positive force but government intervention in the promotion of economic growth while postwar reconstruction period was a time to reflect on the economic crises that occurred at that time and provide solutions to their re-occurrence. This led to the creation of the Bretton woods institutions to assist in the promotion of ‘stable economic growth within a capitalist system’ (p. 36)

Willis describes the linear stages theory and makes emphasis on Rostow, the American economist and political theorist’s stages of Economic growth to development. Here, development was seen as a state where a large number of the population could afford to spend largely on consumer products and development was viewed as modern, moving from agricultural societies to an industrial economy. While she tries to decipher early theoretical ideas, Willis has not made clear linkages between some of these theories and how they have come to evolve in economic debates and discussions over time.

Chang, H., and Ilene G. (2004) ‘Reclaiming Development from the Washington Consensus’, Journal of Post Keynesian Economics, 27(2), 274-291.

The fundamental of this article is to correct the notion that there is no alternative to the Washington Consensus. The authors argue that ‘neoliberal policies have failed to achieve their goals in developing world’ (p. 274) and so discuss the major development myths for justifying neoliberal policies that have been harmful to developing world and perhaps as a complacency to the reader, possible alternatives to these policies.

These myths, evaluated individually, describe how these policies have lacked credibility. Myth 1; In contrast to the neoliberal policy success, the reality is that the policy has not promoted its main aim of economic growth. Myth 2; Developed countries gained success through free market policies whereas records claim they relied upon interventionist policies for development. Myth 3; Only neoliberal policies can succeed in today’s global environment whereas in fact there is evidence of ‘continuing institutional and policy divergence across national boundaries’ (p. 277) Myth 4; Discipline imposed by international institutions to keep them honest whereby placing policy making authority in the hands of these organizations. Myth 5; The East Asian model cannot be replicated when in fact most developed countries utilized this model. Myth 6; Developing countries should imitate the Anglo American model of capitalism which fared poorly in the economic boom of the 1990’s.

The authors went ahead to put forward alternative policies for faster economic development which includes the financial system providing adequate finance quantities for investment projects at appropriate prices, enforcing strict laws on new foreign loans incurred by domestic borrowers, defocusing on budget balance and maximizing FDI potentials to promote economic and industrial development in developing countries

While arguing for these policies, it will be sensible to note that economies are different and there can be no ‘best practice’ policy that everyone should use (Chang 2003). Policies for development should not be ‘fixed’ but depend on stages of development of a developing nation and other factors such as resource capacity, economic, political and social conditions.

Pender, J. (2001) ‘From Structural Adjustment’ to Comprehensive Development Framework’: Conditionality Transformed?’ Third World Quarterly, 22 (3), 397-411.

Pender reviews how the World Bank’s approach to development has changed over decades and brought about important shifts to its conditionality approach. In the light of new changes between the 90’s and today, the World Bank formulated a Comprehensive Development Framework, based on a relationship of partnership to replace its erstwhile structural adjustment lending (p. 397).

The author examines why the World Bank’s perspectives of development changed through different periods; In the 1980’s to early 90’s, GDP was used as a measure of development as the Bank was mostly concerned with rapid economic growth and sustenance for least developed countries (LDC) and the adoption of policies such as restriction of state spending, controlling inflation, commodity exports and privatization as factors to achieve development.

The 1990’s drew lack of confidence in these policies and there were strong doubts about its competence judging from the success of the Asian Economies that developed rapidly without the World Bank’s policy prescriptions. This informed the Bank to change its 1980 view about minimal state role in development and that ‘growth by itself is not enough’ (p 401). Thus in 1990, a formulation of an approach based on both ‘labour intensive growth’ and ‘widespread provision of basic social services’ (p.401). In spite of these alterations, there were criticisms that the Bank reforms were not aiding Africa’s growth but rather, increasing stagnant economies through the implementation of the Bank’s policies.

According to Pender, the Bank lost confidence in its policy framework in early 1995, with the Asian miracle and LDC’s failure and was forced to critique its own policies and re-orientate. This modification was experimented between 1995-1997 with ‘improvements in the understanding of economic development’ and poverty reduction as the central focus.

The author gives clear informed views of the process of policy change within the World Bank at different times but fails to analyze the impact of this new focus of poverty reduction and its success to the development of today’s third world countries.

Chang, H. (2003) Kicking away the ladder. Development Strategy in Historical Perspectives. London, Anthem Press. Chapter 1.

Chang’s analysis centers around one question, ‘How did the rich countries really become rich?’ He uncovers some myths about developed countries developmental experience and argues that developed countries did not develop through the same policies that they recommend to the developing world.

This pressure from developed countries to the developing world to adopt a set of ‘good policies’ that they adopted when they themselves were developing is faced with criticisms because ‘historical evidence suggests otherwise’ and goes on to say that they are trying to hide the ‘secret of their success’ (p. 2).

Some of these policies include liberalization of trade, privatization, restrictive macroeconomic policies and deregulation but facts show that most of the developing countries used export subsidies and industry protection, industrial policies that the WTO disapproves in the present world. The USA and UK were examples of ardent users of these same ‘policies’ frowned at in contrast to the free trade policies and free market they preach.

Chang quotes List, the German economist that ‘Britain was the first country to perfect the art of infant industry promotion’ which is the principle behind most countries journey to success (p. 3). He argues that developed countries, while alleging to recommend good policies to developing countries are actually trying to ‘kick away the ladder’ of their own economic development.

A conclusion is drawn on some methodological issues of David Ricardo’s neoliberal policies to Friedrich List’s infant industry argument that while developed countries preach Ricardo to developing nations, they actually pursued List’s policies in the past.

Although Chang did not confront and compare works of economic historians e.g. L.E Birdzell’s How the West grew rich in relation to his How did the rich countries really become rich to identify similar or different conclusions, his examination of historical materials to reach important and interesting conclusions is a contribution that is immensely valuable to the current debates on development that will evidently challenge contemporary policies and enrich development theory.

REFERENCES

Chang, H. (2003) Kicking away the ladder. Development Strategy in Historical Perspectives. London, Anthem Press. Chapter 1.

Chang, H., and Ilene G. (2004) ‘Reclaiming Development from the Washington Consensus’, Journal of Post Keynesian Economics, 27(2), 274-291.

Pender, J. (2001) ‘From Structural Adjustment’ to Comprehensive Development Framework’: Conditionality Transformed?’ Third World Quarterly, 22 (3), 397-411.

Rapley, J. (2007) Understanding Development: Theory and Practice in the Third World (3rd edition). Colorado. Lynne Reinner.

Sen, A (2001). Development as Freedom. Oxford. Oxford University Press. Chapter 1.

Willis, K. (2005) Theories and Practices of Development. London. Routledge. p. 32-42.