Ghana fact of the day

After a sluggish period, Ghana seems to be doing well again:

…Ghana is on track to make a remarkable claim for a country mired in poverty not long ago: It is likely to have one of the world’s fastest-growing economies this year, according to the World Bank, the African Development Bank, the International Monetary Fund and the Brookings Institution.

Its projected growth in 2018, between 8.3 and 8.9 percent, might outpace even India, with its booming tech sector, and Ethiopia, which over the last decade has been one of Africa’s fastest-growing economies thanks to expanding agricultural production and coffee exports.

According to the I.M.F.’s projections, only Bhutan, with a minuscule economy, and Libya, whose war-ravaged economy plunged in recent years, may have a higher rate of growth this year.

The danger is that commodities — oil and cocoa — are driving the boom.  Here is more from Tim McDonnell at the NYT.

Comments

Ghana has a track record of unreliable GDP statistics:
https://www.washingtonpost.com/news/wonk/wp/2012/11/24/think-u-s-gdp-numbers-are-unreliable-check-out-ghanas/?utm_term=.4362b14e1124

Are there statistics or anything to indicate that India's tech sector is still "booming?" Genuinely asking.

No. As is often the case with NYT, the truth is the opposite. Increasing competition from global companies, protectionism and visa restrictions in the west have resulted in mass layoffs and a hard re-adjustment.

https://qz.com/1152683/indian-it-layoffs-in-2017-top-56000-led-by-tcs-infosys-cognizant/

Also, unlike China, the Indian tech sector is easy prey for takeover and will likely evolve along the lines of the one in Europe (essentially a digital colony of US with some Chinese sideshows).

https://www.bloombergquint.com/opinion/2018/03/06/why-is-pm-modi-allowing-dacoit-y-on-indian-digital-startups

Demand for cocoa is going to skyrocket in the coming decade.

Why?

I'm gonna switch to chocolate milk.

Note that the beans are called "cacao". It's only after roasting they become "cocoa". Ghana has one of the oldest and best cacao research programs in the world. If they see greater success producing cacao, it will have been well-earned.

Is the quantity of productive capital owned by the people of Ghana increasing rapidly by the use of Ghana's labor force?

If yes, the growth is real.

If no, then Ghana is being pillaged and plundered.

Saudi Arabia has been undergoing a century of pillage and plunder. Saudi Arabia is much poorer than a century ago. The only way it can be considered to have a future is because it had so much wealth for the West to pillage and plunder that it still has a chance to create and economy where Saudis build productive capital assets to create self sustaining "wealth".

We might not have reached peak oil, but I think this is peak mulp

lol

Saudi Arabia has been undergoing a century of pillage and plunder. Saudi Arabia is much poorer than a century ago.

The inhabitants of Saudi Arabia were once so poor that they were mocked for eating lizards and insects. So poor that the Americans could buy their government for peanuts.

After the West has showered about a trillion dollars on them and their main health problem seems to be diabetes as they eat themselves to death, mulp thinks they are poor.

They GDP per capita on a PPP basis is over $55,000. Their next door neighbor - fortunately saved from vicious Western exploitation - Yemen has a GDP per capita of $1,200.

Aren't poor countries known for having highly variable growth rates? It'll probably be negative again in 2-3 years.

It is much easier to double Ghana's GDP than Japan's. To call this "remarkable" is a typical innumeracy.

Absolutely right.

I was taught in roughly the first grade - well, OK, a little later - that when someone starts citing percentages it is necessary to look at the base before drawing any conclusions whatsoever.

Ghana? How about The Gambia, is their non-dictator man-in-the-street just elected last year working out? And how about Togo as a powerhouse? You laugh? But remember, Lome was not built in a day. Da-da-dumb.

Speaking of dumb, if you Google IQ by country* the lowest country IQ in the world is in Equatorial Guinea, not to be confused with Guinea-Bissau, having an IQ below 60 (59), when retardation in the USA is below 80. What would Garett Jones say? Steve Sailor? It's not racist if you live in the Third World like I do, or can back it up with some theory, otherwise it is. BTW Brazil does not show up in IQ by country graphs for some reason, but I think they are probably like Peru, below Chile and Argentina. TR? *See here: https://iq-research.info/en/average-iq-by-country (Italy is smarter than the USA)

Bonus trivia: much to my surprise, Guyana has a per capita GDP of $4492 nominal, which is not bad at all. I thought it would be like Ethiopia, with a GDP of less than $1000.

I strongly suspect IQ scores can't be meaningfully compared when the people taking them are from such widely divergent situations. There is surely plenty of stuff wrong with Equatorial Guinea, but probably not that nearly the whole population is mentally retarded by first-world standards.

+1

Is this anything other than mood affiliation?

Is what anything but mood affiliation?

Isn't it critical exactly what the measurement stick is?

And isn't it critical to look closely at extreme claims. I am willing to bet a lot that that average IQ is a nonsensical measure of intelligence of Equatorial Guineans.

Flynn effect just shows that: the US population didn't become smarter over the last century. It's just that they became better at doing IQ tests.

Honest question. What is right about E.G.? (other than the oil).

Sorry, Ray, but your source is worthless.

It's work by Richard Lynn, a known racist, and incidentally one whose "work" is an important source for The Bell Curve.

See here for more information.

"Tainted" as in "your data violates my ideology."

The work cites Richard Lynn, whose research is a prominent source for a lot of the silliness in The Bell Curve.

Extrapolated from GDP? Are you nuts? And how are those "measurements in the field done?"

If it's like Lynn's other work it's pure crap.

Not to hijack the thread, but "IQ by Country" is not Bell Curve material, but from a later, less-controversial, source. It's based on nutrition and it's actually extrapolated from GDP per capita figures when it's not measured in the field. I have lived in four countries for more than one year and I can tell you some of them are smarter than others. Nothing to do with genetics, but more like being part of a 'winning team'. A great athlete on a losing team will often look bad, despite being very good individually, and the converse is true for an average athlete on a winning team. Read G. Jones book on this (I've not read it yet but have summaries).

Guyana, like its neighbors Suriname and French Guiana, is blessed with a relatively low population density. Agriculture can afford to be inefficient when you have so much land.

Three Cheers to Charles Murray for demonstrating how IQ is decoupled from genetics. His evidence? Almost every white guy who embraces The Bell Curve seems to loose 20 points. This effect is so strong, the currently there are several multi-million dollar twin studies with identical twins being kept in solitary boxes, one reads the book and the other doesn't and IQ is being tested daily.

Here's a funny thing about this, if IQ is linked to national prosperity then it would follow marginal differences would be significant. In other words, if one African country is at 60 pts and another at 75, Those 15 extra points should have a lot more difference than, say, two more developed nations whose numbers are 90 and 105.

Does Ray have any evidence to suppose this then? What would account for African countries having such different IQ averages from each other? Is there that much genetic diversity between African nations?

I thought Charles Murray explicitly restricted his sources of data in Bell Curve to whites to avoid any such charges of racism? Perhaps you are thinking of a different study - IQ and Wealth of Nations by Lynn et al?

On your point about marginal differences in IQ being more important for wealth, perhaps there is a threshold effect. It takes a certain amount of intelligence to be able to design machinery perhaps, so increases in IQ below this threshold doesn't make much difference to national wealth - to illustrate this example, one dog may be twice as smart as another, but neither of them can read. Also another effect may be the percentage of your population above this threshold, the smart fraction idea. Because it is a bell curve raising the mean increasing the smart fraction disproportionately much more.

You're confusing the Bell Curve with Coming Apart. In the Bell Curve he does include a chapter or two on racial differences in IQ.

One dog 'twice as smart' as another seems pretty extreme. A person with an IQ of 100 is 'average' but an IQ of 50 would be moderately retarded (http://paulcooijmans.com/intelligence/iq_ranges.html). But we see diminishing marginal returns. What does 30 points buy you? Well if you're IQ was at 60 then 30 points gets you to 90. You leap from mildly retarded to average. But suppose your IQ is 150? You go from "highly intelligent" to "exceptionally intelligent" at 180. What can you do with that that you couldn't do with 150? Well it's 'under investigation' but until further notice it appears to be little more than an empty title.

If this works for nations and economies, then there should be a big difference between a nation with an average IQ of 60 and one with an average of 70 but less of a difference between one with 100 and another of 110. Alt-rightist who want to make serious arguments about IQ should see if they could uncover such differences. Otherwise I suspect the problem here is you cannot divorce culture from the IQ test. Ghana is not a nation of mildly retarded people, the test simply does not translate well.

The danger is that commodities — oil and cocoa — are driving the boom.

The terrible curse of natural resource abundance. When is this old fallacious chestnut going to be retired? Probably should shut down the US oil industry and logging as well. Who needs diesel fuel for trucks delivering toilet paper?

Yeah the cult of the service sector driving advanced economies is about to get a rude awakening when the bots start doing the work of white collar professionals. But expect protectionist backlash, especially from the doctors and lawyers who will falsely claim you need a human in the loop (you don't, trust me, I know law). AlphaZero is coming to get you, cubicle worker!

The problem is that when your economy is based on one or two commodities, you are extremely vulnerable to swings in those prices. So an apparently growing economy can easily just be high prices for your commodity. Also, some resources (oil, notably) are depleted over time, so you can end up having a booming economy for a long time, and then having your economy fall apart when the oil wells run dry or some smart guy invents a lower-cost way to pump oil that doesn't work for your oil fields. Go ask Venezuela how this works out.

Fair points, but what if your commodities are plenty of land, fertile citizens, and wood? That recipe worked well to make the USA into a powerhouse in the 19th century. So 'resource curse' is overrated, and really the result of the USA/First World getting powerful first (off commodities) then using trade barriers to prevent commodities from being used by others to get out of poverty (sugar imports, farm subsidies, dumping cheap food into Africa thus distorting their market, etc). Put another way: would the American service sector be happy if a bunch of mediocre but not incompetent Indian and Pakistan doctors offered to move to the USA and practice medicine for cheap? I doubt it. Neither would the American Bar association for cheap foreign lawyers. A lot of these "rules" like Dutch Disease are based on hindsight and subject to confounding error.

Indeed. I just hope better institutions prevent them from misusing the proceeds of commodities trade/taxes, particularly oil.

*****Cowen's second law alert*****

There is a large literature on the resource curse, the evidence for it, and the situations when it is likely not to apply. At least give Wikipedia a glance before you rubbish the idea.

There's also a large literature on stomach ulcers being caused by stress.

Ah, one piece of research has been found to be fallacious, so they all must be!

Yeah, doctors believed this for >90 years. My father had a peptic ulcer and underwent the "bland diet" cure(don't ask and it takes years) which !surprise! didn't work. Then he had most of his stomach removed. This did work but 2 weeks of 2 antibiotics would have been easier.

The resource curse doesn't have to happen, it is caused by faulty politics and institutions not by laws of nature. The best solution to the problem is the one Mrs Thatcher used for the North Sea oil bonanza, use the money to lower tax rates. The Norwegian solution of a sovereign wealth fund seems highly fragile, what if the "wrong people" get elected and start using it for political reasons rather than for the benefit of the population. If you support democracy it seems inevitable that this will happen, better to leave the wealth in private hands.

In Norway's case the people are pretty homogenous (and not that numerous) so no matter who is in charge it's not the "wrong people". They're close to the same. You could say the same about Saudi Arabia. Meanwhile a large, fractious place like Iraq can definitely have a resource curse.

Of course the private owners are sure to use it for the benefit of the people. Is that right?

That's not the point here.

The issue is this. Imagine two countries where one has abundant oil, say, and the other doesn't have a lot in the way of natural resources.

According to the logic above the people in the first country must be smarter than the in the second, because they have a higher GDP per capita. How does that make sense?

It doesn't. All the Murray/Lynn stuff is nothing but an attempt to rationalize racism by promoting very badly done comparisons.

Well, oil is not that expensive. But the huge increase in US drilling rigs suggests the cost of exploiting tight oil is lower than I thought and so oil prices may not rise very high before they crash.

"Ghana is on track to make a remarkable claim for a country mired in poverty not long ago: It is likely to have one of the world’s fastest-growing economies this year"

Isn't this exactly as expected, rather than remarkable? Catch-up growth, diminishing marginal returns, etc . . .

One would expect Ghana to conform to Africa's history of poor relative economic performance, so it is remarkable.

> "After a sluggish period, Ghana seems to be doing well again"

In the 1950s, Ghana and South Korea had roughly the same per capita GDP. A sluggish period, indeed.

All countries had the same cap GDP about 800 years ago.

Actually not. Shouldn't bother to correct this but Song China and even early Mongol China had a GNP per capita high enough that it took Europe several hundred more years to match it.

+1

As far as actual consumption, it's about right to say that everyone was equally poor, but those canals, roads, castles, ect, they count in GDP.

Actually the Malthusian limit seems to have been different for different countries, so people in the UK were eating more calories than in China or Japan in the middle ages , probably due to higher disease loads in the UK rather than higher productivity.

And Kim il-Sung never invaded Ghana.

English is the national language. Educated people are leaving for the US or Britain.

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