Following up on my TED talk, is this interview with Matthew Trost. We cover whether limited natural resources are a constraint on growth, the Lebensraum fallacy, The Wire, the tragedy of the commons and other topics. Here's one bit on growth and democracy in the context of China and India.
A lot of people say that India has been held back by its democracy. But let’s remember that despite being a poor country India’s democracy meant that its government never let millions of people starve. No politician wants to starve potential voters. In the long run, I think India is going to benefit from its democracy and not be harmed by it. Democracy is, in a sense, like markets. It provides information and feedback, it leads to a more open system and it constrains government from the worst kinds of abuses. I think that the more China proceeds along the wealth path, the more difficult they will find it not to have a democracy.
Democracy may contrain govenment from the “worst kinds of abuses” and still be a superhighway to serfdom. Your point about feedback though is the only cause for hope I see in the US; if those currently Reps in the House who are fasttracking socialism in America are unseated by Reps opposed to bailouts, trade restrictions, nationalized health care (God spare us from Canadian style health care), the institutional lack of competition that have doomed public schools by and large in America, Freddie and Fanny, etc., then you will be less able to celebrate the decline of America as the decline of America as a disproportionate source of new ideas.
Of course, if the US continues to move left on economic issues while China and India move right, you will have much to cheer.
a good summary of what is known on democracy and growth
http://www.yalepresswiki.org/w/index.php?title=Good_Capitalism%2C_Bad_Capitalism (from growthology.org authors )
“…despite being a poor country India’s democracy meant that its government never let millions of people starve.”
What do governments have to do with “letting people starve” or not?
are you a socialist or something?
Amayrta Sen said that before.
What governments have to do with letting people starve?
Much , Stalin killed 12 millions starving then to death. Lenin let die 5 millions.
Mao killed 50 millions , starving them.
Pol Pot starved to death the 1/3 of Cambodias population
The british government let die scores of people in India and Ireland with bad policies that they didnt changed because they had no feedback
But let’s remember that despite being a poor country India’s democracy meant that its government never let millions of people starve.
By going to Washington to ask for food aid during the Bihar famine in 1967, sure. See Bhagwati’s characterization of events, in which he points out that democracy actually made it harder for them to fight the famine internally.
Why do you call it the “Lebensraum fallacy” when the attendees at TED are more likely to understand it if you called it the Manifest Destiny fallacy? Or are the majority of the attendees German….
“If one is concerned chiefly with economic growth, why is the Indian government’s prevention of starvation laudable?”
There is no proof that the Indian government prevents starvation. For food the free market is probably close to the best allocator/distributor etc. Amartya Sen’s entitlement theory is ridiculous.
The Bihar famine is described well here:
http://paulbrass.com/files/Prb_06_the_poli.pdf
In particular, it came at a time when the Economic Survey of Indian Agriculture 1966-1967 said:
“All the efforts at achieving self-sufficiency in foodgrain production during the three Plan periods did not fully succeed for one reason or the other and the last year of the third Plan saw a sudden downward shift from the rising trends of crop production. This came as a great shock to everyone concerned with agriculture and created doubts in the minds of many as to the soundness of the planning process so far in existence for achieving self-sufficiency in food production.”
“Why should I believe that the marginal value a person derives from food is as intimately connected to the money he can pay for it as microeconomic theory would suggest?”
How intimately connected does microeconomic theory suggest the marginal value a person derives from food is to the money he can pay for it?
If one is to believe that the demand curve is related at all to consumer surplus, then marginal value is quite related to money willing to pay. In particular, this goes for food.
Though I am still young, I’ve found several occasions in which I’ve felt, not disappointed, but humbled to find that my great idea had already been well discovered and elaborated upon. A few years ago I finally concluded that the best idea I may ever have is that the act of concession is not a surrender, but a privilege. If you’ve spent your life thinking of things one way and someone comes along to prove you entirely wrong, well… you’re no worse off than if you had been right all along.
Today I watched your TED talk and when you put up the Thomas Jefferson quote, the irony of it all came cascading down upon me and I had to laugh out loud. Even my best idea, to accept that my ideas existed before I did, existed before I did.
So thanks to you and Mr. Jefferson for humbling me once again. But thanks to you solely for the reminder that today, as it has always been, the idea is our most crucial resource and that the more fields (to use a metaphor) we find fruitful, the better off we will be.
I agree. When one sees fit to notice and embrace the success of our neighbors, there is every reason to be optimistic.
The notion that the free market is an efficient allocator is a deduction from microeconomic principles applied to a free market, so the fact that they are invalid is quite relevant to your claim.
In any case, if the free market were, in fact, good at allocating food, we should see in every free market that nobody starves or is malnourished. So go ahead and show that. (And I don’t believe you when it comes to the United States and lack of malnutrition – do you have any statistics to back that up?)
Besides, your argument about the eventual zero marginal value of food is a red herring; why does Warren Buffet not eating 20000 steaks a day mean that there will be enough food for Joe the starving bum?
(1) You need to provide a clear definition of “free market” and then find out if that variable significantly affects malnutrition rates across countries.
(2) I’m not asking for a proof; I’m asking for statistical evidence. And coming up with examples of non-free markets does not support your contention.
(2) Why do you expect me to believe that just because food can be made cheaply, everyone will be able to afford it? You seem to assume that everybody will somehow have enough money to pay the equilibrium price for however much food they need. Is food no longer a scarce resource?
Have you and Caplan ever publicly talked about democracy and growth? I’d love to see a bloggingheads about that, I daresay.
very nice article and style, I hop to read more of your quality psosts
Have you and Caplan ever publicly talked about democracy and growth? I’d love to see a bloggingheads about that, I daresay
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