Thursday, July 12, 2007

Resources, Development and Making a Buck

The New York Times has a story on Oxford economist Paul Collier and what they call "...a new and potentially powerful idea." For backround Climateer Investing had the London Times story last week: The bottom billion bite back

With this little blog I've tried to highlight some of the many, many interrelated challenges of energy use and development. Two of them, related by their timeframes are 1) Transitioning transportation from petroleum to electricity, which has been twenty years in the future for the last forty years and 2) Economic development of the poorest peoples on earth (ditto on the timeline). There is so much human potential in sub-saharan Africa that, should it be realized, would be akin to discovering a hitherto unknown energy source.
That's why I post things like:
Africans to Bono: 'For God's sake please stop!'.

Collier is one of the people thinking about these things, another is Peruvian economist Hernando de Soto who seems to have a handle on the basic elements needed for economic growth in smaller economies. From the Wikipedia entry:

Time magazine chose de Soto as one of the five leading Latin American innovators of the century in its special May 1999 issue Leaders of the New Millennium, and included him among the 100 most influential people in the world in 2004. De Soto was also listed as one of the 15 innovators "who will reinvent your future" according to Forbes magazine’s 85th anniversary edition. In January 2000, Entwicklung und Zusammenarbeit, the German development magazine, described de Soto as one of the most important development theoreticians of the last millennium. In October 2005, over 20,000 readers of Prospect magazine of the UK and Foreign Policy magazine of the U.S. ranked him among the top 13 "public intellectuals" in the world from the magazines’ joint list of 100.

Back to Professor Collier, from the NYT:

...The solution is to make these governments more accountable in spending their money, but how can that be done?

Simply sending more foreign aid backfires when leaders are corrupt and governance is bad. And Western governments are not willing to send enough aid to make a big difference. Revenue transparency is not an immediate fix, but it would increase the productivity of both Western aid and Western trade. Workable development ideas are hard to find, but Professor Collier may have identified the next frontier for positive change.

And how are you going to make a buck from this highfalutin' stuff?
Think about it.
Here's a hint: Intelligent People Are More Patient In Financial Matters; Higher IQ Also Makes More Tolerant Of Risk

HT: Economists View