Make Wealth History Because the earth can't afford our lifestyle

Cultural and social factors that affect development

Posted on July 1, 2007 by Jeremy 29

1diggdiggThis is part 4 of an exploration into why some countries are poorer than others. Discrimination Sometimes there are social or cultural factors that hold back poor countries. Discrimination is one of these. If there are certain people groups that are discriminated against, the countrys overall productivity can suffer. This may be a tribe, a caste, a racial category or minority language group. I have already mentioned Cameroon, which has both French speaking and English speaking regions. All the infrastructure happens in the French speaking part. French speakers in Canada complain of the opposite. Welsh speakers in Britain, or Catalans in Spain, have historically faced similar problems. Racial discrimination may be an issue, excluding certain groups from economic activity, either deliberately or not. Racial minorities regularly have poorer exam results and economic prospects than the majority. More serious forms of exclusion would be apartheid South Africa, or the Asian communities driven out of Uganda under Idi Amin, which was disastrous for Ugandas economy. Another division may be the role of women. Jeffrey Sachs talks about this in The End of Poverty: Cultural or religious norms may block the role of women leaving half the population without economic or political rights and without education, thereby undermining half of the population in its contribution to overall development. If you dont believe that women should work, you have effectively halved the earning potential of your country. Population Closely linked to this is the population issue. If women see staying at home and bringing up children as their chief role, they will have more children than those who work. There is nothing wrong with having lots of children, as long as you can provide for them. Jeffrey Sachs again: With fewer children, a poor household can invest more in the health and education of each child, thereby equipping the next generation with the health, nutrition, and education that can lift living standards in future years.

As Paul has talked about here before, world population has exploded. What is interesting is that the countries where this has happened are often those where women do not play a role in business or society. When women are educated and given a choice, some will stay at home and look after children, and others will pursue careers or start small businesses. This is an important factor, as some countries have seen their population double or triple without their economies keeping pace. That leaves more mouths to feed, and just not enough to go around. Culture Ive already mentioned the role of women, but culture can have hidden effects in business, trade and development. China may be a major power now, but it was the worlds most developed country in the middle ages, and stagnated, or even went backwards, for centuries. Part of this was cultural, a pride and sense of self-sufficiency that led to a closing of Chinas borders. China seems to have long been stationary, Adam Smith wrote in 1776, in his Wealth of Nations. A country which neglects or despises foreign commerce cannot transact the same quantity of business which it might do with different laws and institutions. Thats changed, but nationalism, suspicion, or radical philosophy still has some countries closed down to outside involvement communism in North Korea, or extremist Islam in Taliban Afghanistan, locking countries out of development. This the far end of the spectrum, but culture works in subtler ways too. Some cultures believe in a greater good, in unity, in the rule of law. They are optimistic, hopeful, ambitious and ready to pull together. Others can be paranoid, fragmented, uncertain of their place in the modern world, angry, resistant to change. Rich countries can be overconfident and brash. Poor countries can see themselves as victims and become despondent. In his The Wealth and Poverty of Nations, economic historian David Landes says If we learn anything from the history of economic development it is that culture makes all the difference. The limits of cultural interpretations At the same time, cultural influences on development are notoriously hard to call from the outside. Hinduism was often cited as one of the reasons why India would never develop. Because everyone accepts their place in the world, it was assumed that Hindus would lack the ambition required to innovate and do business on an international stage. The recent growth in Indias economy proves that wrong quite spectacularly. Korean economist Ja-Hoon Chang quotes a 1911 travel book that describes Koreans as sullen,

lazy and religionless savages, something that hardly holds true today. So did Korean culture change, or was the writer simply being superior? We understand each other better than ever in our globalized world, but our language and traditions are still full of little prejudices that imply we are better than others, and that our neighbours are lazy and dirty and uncouth. I love the fact that not turning up for work is called taking French leave in England, and filez a lAnglaise (or doing an English) in France. A Malagasy friend once joked that in Madagascar, every tribe believes that every other tribe eats cats. In short, culture no doubt plays a role in development, but we have to watch our own biases as we seek to understand why some countries succeed and others fail.

Population as an asset not a liability

NEW DELHI: F
EXPERTS
SAY THAT THE OR LONG

INDIAN

POPULATION WAS CONSIDERED A CURSE TO THE NATION.

BUT

NO LONGER.

INDIAN

POPULATION WHICH IS SUPPOSED TO OVERTAKE

CHINA

VERY SOON, IS ASSET RATHER THAN A

LIABILITY.

GOVERNMENT

IS STEPPING TOWARDS THINKING

INDIA'S

POPULATION TO BE USED TO ILLUSTRATE THE COUNTRY'S HUGE

POTENTIAL, BOTH ECONOMIC AND POLITICAL, EXPERTS SAY.

IS YOUR WORKPLACE WHISTLE-BLOWER FRIENDLY?

YES NO
Submit vote

VIEW

RESULT

WITH

JUST

2.4

PERCENT OF THE GLOBAL LANDMASS HOUSING

16

PERCENT OF THE GLOBAL POPULATION, SUCCESSIVE

INDIAN

GOVERNMENTS HAVE BEEN FACED WITH THE PROBLEM OF HOW TO REDUCE EVER-INCREASING PRESSURE ON EVER-DWINDLING RESOURCES.

NOW

ITS MASSIVE WORKFORCE IS BEING SEEN AS THE COUNTRY'S GREATEST RESOURCE.

"THIS

CHANGE HAS BEEN AIDED BY THE REVOLUTION IN WHO HELPED FORMULATE THE

INDIAS

INFORMATION TECHNOLOGY SECTOR ," SAYS DEMOGRAPHER FIVE YEARS AGO.

A.R.

NANDA, "THE

NATIONAL POPULATION POLICY

CORPORATES AND SOME ECONOMISTS HAVE BEEN HIGHLIGHTING HOW

INDIA'S

WORKING POPULATION CAN MAKE UP FOR

DEFICIENT OR SOMETIMES EXPENSIVE LABOR ELSEWHERE FOR THE PAST FIVE TO SEVEN YEARS. HE SAYS.

THIS

HAS FUELLED THE RETHINK,"

INDIA

HAS IN THE PAST DECADE EMERGED AS A MAJOR BACK OFFICE TO THE WORLD WITH GLOBAL FIRMS OUTSOURCING WORK

RANGING FROM CREDIT CARD PROCESSING TO AIR TICKETING TO TAKE ADVANTAGE OF THE COUNTRY'S LESS EXPENSIVE, EDUCATED,

ENGLISH-SPEAKING INDIA
PRODUCES

WORKFORCE.

2.5

MILLION

IT,

ENGINEERING AND LIFE SCIENCES GRADUATES A YEAR, BESIDES ABOUT

650,000

POST

GRADUATES IN SCIENCE AND

IT

RELATED SUBJECTS.

THE IT

SECTOR ALONE EMPLOYS ABOUT

850,000

GRADUATES AND PROFESSIONALS WHILE THE PHARMACEUTICAL AND

BIOTECHNOLOGY SECTORS ARE SNAPPING UP OTHERS.

THE

GOVERNMENT SAYS

402

MILLION

INDIANS

ARE AGED BETWEEN

15

AND

59 -

THE WORKING AGE

AND THAT THIS NUMBER

WILL GROW TO

820

MILLION BY

2020. INFOSYS,
MILLION, SAID THAT BY

N.R. NARAYANA MURTHY,

WOULD BE SHORT OF SIX MILLION.

HEAD OF PREMIER SOFTWARE EXPORT COMPANY

2020

THE

UNITED STATES RUSSIA

OF

17

MILLION PEOPLE OF WORKING AGE,

CHINA

OF

10

JAPAN

OF NINE MILLION AND

DEMOGRAPHER NANDA

AGREES MORE INVESTMENT IS NEEDED, POINTING TO THE EXAMPLE OF

CHINA,

WHICH HE SAYS, PLOUGHED

RESOURCES INTO THE HEALTH, EDUCATION AND SOCIAL SECTORS BETWEEN

1950

AND

1980. 1970S
BEFORE THE ONE

"IN

TERMS OF ITS IMPACT ON THE GENERAL MASSES, THE NUMBER OF BIRTHS CAME DOWN IN THE

CHILD NORM WAS INTRODUCED,"

NANDA -

SAYS.

"WE

SHOULD EMULATE

CHINA

AND INVEST IN OUR SOCIAL SECTOR."

GDP

ON SOCIAL INFRASTRUCTURE

UP FROM THE

0.9

PERCENT AT PRESENT," SAYS ONE HEALTH MINISTRY OFFICER. OR

"INDIA

WILL ALSO NEED TO IMPROVE THE LOT OF THE

20

30

PERCENT OF ITS POPULATION WHICH IS CURRENTLY BELOW THE

POVERTY LINE," SAYS

NANDA.
WANTS TO CONVERT ITS HUGE POPULATION INTO A DEMOGRAPHIC BONUS OR DEMOGRAPHIC DIVIDEND."

"THIS

IS VITAL IF

INDIA

DESPITE 1.012

GOVERNMENT EFFORTS TO CUT GROWTH RATES, BILLION IN

INDIAS

POPULATION THAT WAS BILLION BY

238

MILLION IN

1947

TOUCHED HEALTH

MARCH 2001

AND IS EXPECTED TO BE

1.263

2016,

ACCORDING TO

INDIAS

MINISTRY.