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.]
on July 18, 2007
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."
on May 25, 2008
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.
on April 27, 2008
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).
on November 25, 2011
... to read all of this condescending book, but had to throw it across the library because it was so infuriating. I do remember Collier disparaging on indigenous people in one section because they by and large distrust the G8. All I could think was, "well, why SHOULDN'T they?" All the G8, IMF, and World Bank have done for the Global South is increase inequality mainly through structural adjustment. If these neoliberal agencies have increased poverty for the last 30 years, how does Collier's reliance on the G8 help the Global South? It really made me angry that Collier would basically scoff at the very people he claims he's trying to help because their experiences don't gel with his assumptions.
Another passage I literally laughed at because it was so ridiculous was Collier's argument that terrorism and insurgencies are more likely to occur in some territories because of their mountainous geographies. Mountains are great hiding places for "subversive" groups, sure, but NOT THE CAUSE! Injustice and inequality are much better explanations.
If he wants to propose an effective development strategy, Collier should listen more to the people who have lived and experiences these inequalities. Collier is espousing an ivory tower, neoliberal ideology whose roots are embedded in colonization. All in all, this book endorses perpetuating cycles of debt and dependency for the "Third World" rather than participation and grassroots-level change. He also assumes that neoliberal capitalism without regulation can be tacked on to every culture without any consequences. Collier seems afraid of the people living in the Global South, and therefore shouldn't be in a position to tell his audience what is "best" for these subaltern people.
If you have an interest in this subject matter but would like to hear a different perspective than Collier's, I suggest searching for anthropological texts and ethnographies concerned with political economics and dependency theory. They're much less judgmental.
*Also: this is minor, but the title is a misnomer in my opinion. It should be called the "Bottom Billions" because way more than 1/7 of the world is impoverished by Western standards. In fact, a lot of people IN the West could be considered subaltern.
The No-Nonsense Guide to Globalization (No-Nonsense Guides)
on August 8, 2007
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.
on August 16, 2007
This very eloquent and mostly thoughtful book about the world's poorest countries will offend ideologues of all stripes. Collier's four different explanations for poverty traps (war, presence of natural resources, bad neighbors blocking trade routes, and corruption) clearly place him as a fox rather than a hedgehog without being complex enough that they can rationalize any result (although they can probably rationalize more results than an ideal set of explanations would). He blames both villains in poor countries and thoughtless voters in wealthy countries.
Collier sees that globalization has benefited most nations, but provides plausible mechanisms by which globalization can harm some (e.g. through enabling capital flight).
Collier mostly thinks like a good economist, but his prior work for the World Bank biases him to be overly optimistic about improving such institutions. He recognizes the incentives that cause bureaucrats to be too risk averse, but then makes a cryptic claim that the British government understands the problem and is spending money to fix it. He vaguely implies that this is a venture capital-like fund, but fails to say whether they replicated the key venture capital feature of providing unusually large rewards to employees who produce unusually good results. His silence on this subject leads me to suspect that he's asking us to blindly trust institutions that have a long track record of avoiding results-oriented incentives.
He also shows misplaced faith in authority when he tries to calculate the value to the world of rescuing a failed state by using George Bush's calculation that the benefits of installing a good government in Iraq exceeded the expected $100 billion cost. That might be a good argument if Bush had been spending his own money to help Iraq, but his willingness to spend other peoples' money doesn't say much.
Collier says it is "surely irresponsible" to leave Somalia with no government. Yet most evidence I've seen ([...]) says Somalia improved by most standard criteria such as life expectancy when it had no government. I don't know how reliable that evidence is, but Collier's apparent assumption that we don't need to look at the evidence makes his opinion suspect.
The book's biggest shortcoming is the absence of anything resembling footnotes. Collier implies this is too make the book more readable, but he could have put a section of notes at the end referencing individual pages without altering the main text in any way. Instead he only gives a fairly large list of papers he's written. But I can't tell without tracking down and reading a large fraction of them which of them if any support his controversial claims (e.g. that giving money to the poorest countries helps them a bit but that doubling it would reach a limit beyond which further money would be wasted).
But his advice is good enough that its value doesn't depend much on those controversial claims being right. Following his advice to condition aid on results (e.g. sending money to countries when they stop wars, cutting it off if they have a coup or resume war) would provide incentives that would make aid beneficial.
I had previously suspected that large countries have tended to escape poverty more easily in the past few decades because "aid" organizations had enough money to prop up small corrupt governments but not enough to affect a government such as India's. Collier presents a good alternative theory: being a large country pretty much guarantees access to the sea, and by increasing the number of neighbors, increases the chance of having a neighbor which is open to trade.
Another good tidbit is this point on Fair Trade: farmers "get charity as long as they stay producing the crops that have locked them into poverty."
on October 26, 2010
I'm shocked by how many great reviews this book has received from major publications and people on Amazon. I was given The Bottom Billion by a friend who also highly recommended it. Immediately I started to become frustrated by some of the claims Collier makes, one especially ridiculous one is that rebel movements are more likely to start in a country because it is mountainous than because of political or human rights issues. There was no footnote or end note to support such a stupid claim, and the only references he gives is from his own research or that of his immediate colleagues.
I got through he book by grinding my teeth at how many times the author makes claims that were entirely the opposite of everything I learned while studying international theory and development in college.
Collier constantly quotes unnamed and unsourced experts and officials which is also highly suspicious. If you are going to right a book that makes such confident and strident claims regarding invading poor countries I would at least expect more than "well this guy told me this once, so we should invade Somalia". After I finished the book I tried to track down some of his statistical evidence, it then became clear as to why he left them out. For more info on why Colliers' research is inaccurate read the Lancets review of The Bottom Billion.
Finally I would just like to say Collier seems like an arrogant prick with a mild form of aspergers. I know this is very harsh, but as I read the book I couldn't help but think how much I would hate to work or be around this guy. The only time he showed emotion was when he blasted "Headless Hearts" i.e. compassionate people, or when he described the possibility of his son dying in a terrorist attack. It seems as if he doesn't really care about the plight of the bottom billion, but is more interested in defending globalization and neo-liberal economic policies.
Oh, he also does a really soul crushing cost-benefit analysis of the Iraq invasion that frames the argument for and against the invasion entirely based on money. No human consideration at all.
This book is the epitome of American and British exceptionalism, and even though I gave it a terrible review I still recommend reading it so at least the reader will have a better understanding of how smart people rationalize themselves and others in to doing or supporting illegal and immoral policies.
on October 17, 2007
Paul Collier. The Bottom Billion: Why the Poorest Countries Are Failing and What Can Be Done about It. New York: Oxford University Press, 2007.
Paul Collier is Professor of Economics and Director of the Centre for the Study of African Economics at Oxford University. Previously, he worked for the World Bank and the British government's Commission on Africa. As an expert on Africa and economics, he has analyzed the current global economic situation and discovered that 58 states, mostly in Africa, can be classified as failing or failed. The citizens of these nations constitute the "bottom billion," who have been left out of global prosperity. He calls this "a world with a vast running sore--a billion people stuck in desperate conditions alongside unprecedented prosperity" (p. 175). He is determined to find practical ways to help these people out of their dilemma.
Contrary to Jeffrey Sachs, who approaches global poverty as a problem to be solved through increased western aid, Collier says that aid is not a solution by itself and it can even make the problem worse. Contrary to William Easterly, who emphasizes the need for local solutions to poverty, Collier still believes in collective action by the G-8 nations on behalf of the bottom billion. Collier strikes the middle ground between these two other experts, calling for hardnosed decisions about solving the problems unique to the bottom billion. He has little time for the efforts of celebrities and some charitable organizations who approach poverty with "a headless heart" (p. 4). He prefers hard data and analysis.
Collier is a number cruncher, and appears to have investigated issues of the bottom billion from every angle. While other economists may clutter their work with data and jargon, Collier keeps all the technical matters out of sight in order to deliver the bottom line of his research; this makes the book more readable.
Whereas the other five billion humans have begun to benefit from the effects of globalization, Collier says that that train has already left the station where the bottom billion could have boarded it. And it will be a long time before the train comes around to them again because China and India have taken all the available seats. In fact, he calculates that the bottom billion will be stuck in their present sad state on average for the next 59 years!
Why is Collier so gloomy about their prospects? He describes four traps that the bottom billion fall into: the conflict trap (73% have gone through a civil war), natural resource trap (29% rely on exports of some resource like oil or minerals), being landlocked (30% have restricted access to ports and are surrounded by bad neighbors), and bad governance (76% are badly governed and make bad decisions about the economy). These traps are often interrelated, as the abundance of a natural resource may lead to conflict.
The ironic curse of having an abundant resource is that it brings in sizeable revenues that detract from making necessary reforms or from diversifying into other export products. And aid can be just like a resource trap, creating not only sudden extra money, but allowing a system of patronage to develop instead of accomplishing public good. Collier cites studies that estimate that aid ceases to be effective when it reaches 16% of Gross Domestic Product, which is close to the average current level of aid to African nations already.
Collier is not so gloomy as to say that nothing can be done about the bottom billion. He describes four instruments that can help if used wisely: aid, security, laws and charters, and trade. He does not think that globalization will automatically correct anything for the bottom billion, but only wise intervention from other nations to help the reform-minded citizens of the failing states. For example, he believes that extended foreign military intervention can best be used in postconflict situations to provide stability and prevent available resources going back into military expenses at a time when opportunity exists for reforms in crucial areas. International laws and charters can describe and enforce universal norms expected for aid and trade. And in trade, the bottom billion need protection from the giants of Asia to break into manufacturing and services in order to move out of the resource trap.
Overall, The Bottom Billion is one of the more realistic books that seeks to improve life and conditions for the poorest people on the planet. This makes the book sobering to read but gives it a feel of solid research into the causes and remedies of their situation. On the other hand, Collier's recommendations still seem to suffer from wishful thinking, assuming that the international community may actually work in harmony to tackle this thorny problem. His analysis seems realistic but his remedies seem utopian. There is scant evidence, for example, that nations have learned how to use military intervention constructively to solve actual problems of the bottom billion. Collier cites only one instance, the British intervention in Sierra Leone, as being on target to help that nation get back on its feet. Other interventions, however, have mostly made the problems much worse, as in Iraq.
This book is about solving the problem of deep, systemic poverty in the world that is experienced by over a billion people, the "bottom billion" from the title. And Prof. Collier has a wealth of research experience to pull from when writing this book. The problem with this book is that it isn't very accessible to the general public, nor is its case very well put. The first problem is hard to imagine as the main text of this book is less than 200 pages. But he only seems to cite research that he has done or the research of people he has collaborated closely with. Thus this book feels more like the combination and abridgment of all of his research up to this point making the whole thing feel inaccessible he wants (or needs) to convince: lay people in rich democracies. That leads to the second problem. Because it feels like a combination of several research papers, everything about this book has a very neutral tone to it. Though he does criticize the positions of the political left and right, the prose isn't very passionate about his own research and solutions. Where is the galvanizing call to action? The thing that does save this book from a one-star rating though is part 4, where Prof. Collier talks about the different instruments that could be used to help. Chapters 8 & 9 on military interventions and national laws & international charters are the one illuminating part in this whole book and is definitely worth consideration by those in the international community. Still, as mentioned before, the neutral, policy-wonk speak of this work weighs down what might otherwise have been a rallying call to a more broadly and deeply thought agenda for alleviating Third World poverty.