Are you troubled by the grinding poverty in the poorest countries? If so, this book will give you hope that something more can be done.
How can a global economy that routinely produces new billionaires leave a billion people behind in countries where the economic prospects are bleak despite enormous spending aimed at turning things around? Obviously, the remedy isn't working. You could have figured that out for yourself without reading this book.
Professor Paul Collier takes us beyond that disquieting simplification to measure what some of the reasons are that contribute to the stalled economies in those countries (which are mostly located in sub-Saharan Africa and central Asia) where a billion people live.
The primary factors that he can isolate include frequent armed conflicts (coups, civil wars, and wars with other countries), producing high value natural resources that can be easily exported, having no access to the oceans while being surrounded by neighboring countries having a lot of problems, and poorly performing government in a small country. Armed conflicts not only take a lot of lives and do a lot of damage; armed conflicts drive people into new areas creating enormous dislocations and increased disease. Armed conflicts interrupt the ability to run a farm, a business, or to have a normal life. High value exports encourage those in government to seek payoffs from the exports while the exports drive up the value of the currency making local businesses less competitive with imports. If you are surrounded by bad neighbors, you cannot do much exporting or importing so your economy is stuck where it is. A poorly performing government simply siphons off funds into corruption.Read more ›
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This is one the best policy books that I have read and an example of what a good policy book should be all about. It deals with the subject that is often in public spotlight and yet it seems as intractable today as it was decades ago. This sad state of affairs may in at least part be attributed to some of the misunderstanding of what global poverty is all about, who is most affected by it, and what sort of traps those most affected find themselves incapable of escaping. As this book clearly argues, the so called "poverty trap" in and of itself is not a trap at all, since otherwise all World would still be as poor as a few centuries ago. Furthermore, vast segments of the "global poor" actually live in countries that are developing at a more or less steady pace and can expect to be lifted out of that poverty within a generation or two. The ones who seem stuck are the bottom billion of the world population, and this book deals with them. The research that this book is based on comes up with four basic traps that could permanently hinder the poorest countries in development. The traps, some of them counterintuitive, are:
1. The Conflict Trap 2. The Natural Resource Trap 3. Landlocked with Bad Neighbors 4. Bad Governance in a Small Country
Not every one of the poorest countries in the world is subject to all of these traps, but they are subject to at least one of them. Furthermore, Collier is not content to just describe the problem; he offers several courses of action that can deal with them. At least one of them, military interventions, has been largely discredited lately in the eyes of the public and policy wonks alike. However, if we are sincere and serious about helping the poorest in this world, we need to keep the military option open.Read more ›
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243 of 248 people found the following review helpful
finally, a compelling, nuanced, evidence-based treatise on how to help the very poorestJuly 2 2007
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Collier has two recommendations for helping the poor: "narrow the target and broaden the instruments." Narrowing the target means focusing not on the five billion people in the "developing world," for four billion of those people live in countries that are already growing, many of them very quickly. One billion of the world's people (70% of whom are in Africa) are in countries that are going nowhere fast, except - in some cases - down. Broadening the instruments means shifting focus from aid to an array of policy instruments: better delivery of aid, occasional military intervention, international charters, and smarter trade policy.
The most frustrating element of recent books on economic development is that they wildly overstate. Jeffrey Sachs, in The End of Poverty, promises that we can eradicate poverty with a few simple (if not easy) steps; and William Easterly, in The White Man's Burden, tells us aid is a disaster (with some tiny caveats at the end). Collier offers the nuanced voice that has been missing. He draws on decades of his and others' careful research to explain four traps that keep most of the bottom billion in captivity and why globalization as it is currently configured will do little for these poorest nations.
He goes on to explore how each of a whole array of policy instruments (including but not limited to aid) can play a key role in helping the bottom billion get on track towards growth. He explains what kinds of aid are most likely to help post-conflict societies and corrupt societies, how the WTO could actually play a useful role in helping the poorest, how to credibly increase private investment, and where military intervention might actually work. Collier's recommendations feel the most plausible of any out there.
Collier brings credibility to the table with non-technical descriptions of many of his studies as well as anecdotes of challenging Kenya's ex-President Moi on his corrupt agricultural policies or asking Nigeria's finance minister about obstacles to reform. The research is not unassailable (for example, when he calculates the cost of a failing state), but he has spent years using the best data and methods available to get at answers to completely intractable questions: the results are at the very least worth weighing carefully.
The book has no notes except a heavily abridged list of Collier's studies at the end. Some endnotes with better references for those who would like to examine the research more carefully would improve the volume.
Despite that minor critique, this is a readable volume (under 200 pages) with some of the best analysis on economic development that I have read. Nicholas Kristof, the New York Times columnist, calls The Bottom Billion "the best book on international affairs so far this year." He's right.
[The Kristof quote is from "Africa's World War," New York Times, June 14, 2007. If I haven't convinced you to read the book, then read Niall Ferguson's review in the New York Times ("The Least Among Us," 1 July 2007) or Martin Wolf's review in the Financial Times ("How the bottom billion are trapped," 13 May 2007). Both are available on-line.]
91 of 95 people found the following review helpful
Between a Rock and a Hard PlaceJuly 18 2007
- Published on Amazon.com
Developing countries are quite unlike Tolstoi's characterization of happy and unhappy families. Each happy country looks different from the other, and there are vast differences between China, India, Brazil, and other developing success stories, but there is a similarity between unhappy countries--countries that are not only failing to develop, but also going downward and falling apart. Together, these countries have a combined population of about one billion people, and what happen to this bottom billion has important consequences for the whole world.
Paul Collier pioneered the burgeoning research on the economic causes of conflicts, and his work on civil wars has proved quite controversial among political science experts. Those experts tend to interpret civil wars in terms of heroic struggles motivated by grievances or ethnic strifes reflecting deeply-rooted hatreds. The author's research shows that rebel groups are usually doing well out of war, and that greed often trumps grievance as the underlying cause of conflict. He proves this by statistical analysis, showing for instance that there is basically no relationship between political repression and the risk of civil war, or between ethnic fragmentation and conflict (although ethnic polarization does play a part).
Conflict is not the only trap. The author also goes through the natural resource trap, the trap of being landlocked with bad neighbors, and the trap of bad governance in a small country. Those traps often reinforce each other, and their combined effects condemn the bottom countries to the slow lane. In each case, Paul Collier not only successfully reviews the existing literature, but also offers original insights drawn from his own research. For instance, he demonstrates that far from being immune from the resource curse, democracies may create additional risks by inducing a phenomenon of "survival of the fattest". He is, to my knowledge, the first expert to point out that diversification of resource providers away from the Middle East in the name of energy security may actually increase the risk of disruption on world markets by creating new zones of instability: "Shifting our source of supply simply will not work as a security measure if the resource curse shifts with it."
This research has direct policy relevance. By putting a price tag on the cost of a typical civil war (about 64 billion) or the gain of a sustained turnaround placing a formerly failed state on a secure path (about 100 billion), the author allows decision-makers to base their decisions on cost-benefit analysis. He shows that some interventions have a very large pay-off: the British Operation Palliser in Sierra Leone was a huge success, worth perhaps thirty times its cost. The protection offered by the French against military coups in Africa, now tempered by a hesitation to intervene, was perhaps also worthwhile. The European Union's new rapid reaction force may play a similar role in the future by offering a guarantee to democratic governments conditional upon internationally certified free and fair elections. "Making coups history" is certainly more controversial than the global rally against poverty, but may in the end contribute more to the plight of the bottom billion than the doubling of aid flows.
Indeed, the author shows that aid offers only part of the solution, and the way it is currently managed makes it in certain cases part of the problem. Rich countries and development agencies need to narrow the target by focusing more on the bottom billion, while at the same time broadening the instruments in order to consider policy tools other than aid. This process also characterizes the author's own research, which increases the focus of economic analysis by using cutting-edge statistical tools, while broadening the scope of relevant issues, in order to inform the decisions of policy makers. To give an example, people often wonder how much of Africa's wealth has fled the continent, or how much aid leaks into military spending. Paul Collier not only addresses these issues, he answers them by giving numerical estimates (respectively 38% and 11%).
The book also contributes to the broader debate on globalization. The author has little tolerance for the protest crowds of anti-globalizers who besiege international financial institutions and G8 summits. He calls them by their name: they are anti-capitalists, and they have little interest in helping poor countries benefit from the system that they are fighting against. He also challenge people who care about global poverty but are driven by slogans, images, and anger, instead of rational analysis. But he is no rosy optimist either, and he offers a sobering view on global economic integration. Although globalization has worked wonders to lift a vast portion of humanity out of poverty, it is now making things harder for latecomers, who now face formidable competitors in China or in India. In his own words: "When Mauritius escaped the traps in the 1980s it rocketed to middle-income levels; when neighboring Madagascar finally escaped the traps two decades later, there was no rocket."
The Bottom Billion therefore opens horizons across political divides. To quote from the introduction: "The left will find that approaches it has discounted, such as military interventions, trade, and encouraging growth, are critical means to the end it has long embraced. The right will find that, unlike the challenge of global poverty reduction, the problem of the bottom billion will not be fixed automatically by global growth, and that neglect now will become a security nightmare for the world of our children."
88 of 92 people found the following review helpful
Plausible, but . . .May 25 2008
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Economic growth is a complicated business. Too many people focus on single issues, as though you just have to flip a switch to create wealth. You won't find any single-factor-theories here! No sir, this is my new, improved, patented, unique, four-factor theory! Step right up folks, it won't last long!
Cheap sarcasm aside, four is better than one. The four factors Collier alludes to are conflict, resources, geography and governance. A fairly standard list, but he is more careful and nuanced than most in analysing what really matters in each case and the interactions between them. Briefly:
1. Conflict (both civil war and coups): while low income and growth and dependence on primary exports are good predictors, inequality and repression are not. Ethnic diversity can be a problem, but only in the particular case where there is a clear majority group but still significant minorities. Highly diverse countries are therefore as well off as homogenous ones. There is no special "Africa effect" once other factors are accounted for. In one study from Nigeria, fighters tend to be young, uneducated and with no dependents. Having a sense of grievance does not matter. Conflict areas tend to be those with few oil wells (rather than none or many), with no relationship with the level of government services in the region. Most ominously, there does appear to be a trap: once conflict happens once, it makes future conflict more likely.
2. Resources: The resource curse does operate, through the standard channels of Dutch disease, volatility, and kleptocracy. But it is dependent on bad governance. If a country has a working democracy with checks and balances before resource wealth is discovered, there is no problem. But if these institutions do not exist, things get worse.
3. Geography: It matters - being landlocked is bad - but again this is not a homogeneous effect. It depends on having bad neighbors: too poor to be good markets themselves, and with expensive and unreliable transport to the rest of the world. Thus central Africa and Asia are in trouble, while Switzerland prospers.
4. Governance: bad governance seems to be a problem mostly when other things go wrong, and seems to be easier to fix right after a war. A larger, more educated population also helps. Sadly, democracy is no guarantee.
When it comes to help, aid is better for growth than oil. All those expensive bureaucracies apparently do some good in screening out the very worst projects. Collier also emphasises the crucial elements of timing after a crisis: technical assistance first, then cash.
All of this sounds nice and reasonable, but so did a lot of things that turned out to be nonsense. The great flaw of this book is the lack of references. There is literally no bibliography. The only link to more information is Collier's website, and a list of his papers (without links). It is hugely arrogant to proclaim that "my image smasher is statistical evidence", write a book without any references to other's work, and then expect people to take all of your work on faith.
104 of 123 people found the following review helpful
The Most Over-Rated Book of the Century (so far)?April 27 2008
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This is a well written and well meaning book of second rate political theory, supported by questionable statistical analysis, full of factual and logical errors and prone to exaggeration. Because of its flowing style, most readers have presumably glided along the text without pausing to think about facts and logic.
The author deliberately personalizes his text, which unfortunately makes any critique appear personal. Collier no doubt means well, but he vastly over-reaches in his attempt to do good. The result is an unforgivable flexibility with facts and logic. On the first page of the Preface he recounts his ca. 1971/72 resolve to go to Malawi, "the poorest country on the continent". Not quite: In 1971/72 the poorest countries were Burundi and Rwanda, while Malawi tied with Mali for third place. The text should read "Malawi..one of the poorest countries on the continent". But to state the fact would not have the same literary impact as some flexibility with the truth. Unfortunately, this approach continues throughout the book.
Take the second sentence of Chapter 1: "For forty years the development challenge has been a rich world of one billion people facing a poor world of five billion people." This is nonsense - it says that for the past forty years world population has been six billion! Collier is referring to proportions (rich 16.6%, poor 83.4%). Sloppy editing? Yes. Forgivable in a book by a distinguished academic that has garnered so much praise? No way!
A small sample of other errors: Pg. 42 "New discoveries [of oil] have been made in...Gambia, Sao Tome and Principe, Senegal and East Timor.": no oil has ever been found in Gambia or Senegal, and results of the only well offshore of Sao Tome are not known. Pg. 50: Botswana is "resource-rich, ethnically diverse": Botswana is very non-diverse by African standards (79% of people belong to the Tswana tribe, while 72% are Christian). Pg. 145 "Brent Spar was an oil well in the North Sea.": It was an oil storage and tanker loading buoy. One could go on in this vein.
The book's problems go well beyond sloppy factual errors. Its basis lies in the peer-reviewed academic papers of Collier and his collaborators. This esoteric statistical analysis yields such absurd conclusions as "a typical low-income country faces a risk of civil war of about 14% in any five-year period. Each percentage point added to the growth rate knocks off a percentage point from this risk"(Pg. 20). Sounds very neat until you realize that: (a) there is no such thing as the "typical low-income country" (they are as diverse as Nepal and Nigeria), hence this says nothing useful about any particular country, and (b) "measuring" civil wars for statistical purposes is almost impossible (e.g. how many people really died? Think of Iraq today...). What we are left with are the obvious assertions that in general poor countries have more civil wars than rich ones, and if a country is doing well economically it is less likely to have a civil war. We don't need multivariate statistics to know this.
Finally, there are Collier's well meaning policy prescriptions. These center around global standards for good conduct and punishment for those who disobey. This is bracing idealistic stuff, but about as practical in this multi-polar world of Chinese expansion, US dysfunction and European impotence as calls for global revolution. Come to think of it, Collier has not strayed as far as he would have us believe from the wide-eyed idealism of the Oxford Revolutionary Socialist Students, whose ranks he joined in 1968 (Preface).
14 of 15 people found the following review helpful
Objectivity + Readability = Must ReadAug. 8 2007
- Published on Amazon.com
The previous reviews have done a solid job explaining the concepts. I will agree that the lack of citations is annoying, but with some unnecessary effort, you can find the citations you want from his website.
This book is not only fascinating and thought-provoking, but very easy to read. Collier distills concepts that are broad, deep and complicated like few writers I have come across. He is probably an excellent teacher because he can translate his knowledge into language I can understand.
The big reason to buy this book is that he does a great job explaining exactly why being resource-rich is a curse. Others have alluded to this phenomenon, but Collier is the first to really impact my understanding of the issue. He also explains why electoral democracies with poor checks and balances are actually worse at dealing with this curse than autocracies.
The good news is that full-fledged liberal democracies with strong checks on executive spending are able to out-compete them both.
This book is refreshing because he is not a polemic loud-mouth like so many writers on politics, aid and development. He is very conscious of over-reach and he is very measured in his praise and condemnation. He seems like a reasonable guy with a ton of experience and some very good ideas about helping make the world a better place.
The book is only 188 pages, just buy it already. You won't regret it.