Building an effective market and state

I have recently signed a contract with Cambridge University Press to publish a manuscript I co-authored with Jerry Hough (a political scientist at Duke University).  The title of the book is Building an Effective Market and State: Lessons from England, Spain, and Their American Colonies.  I’ll blog more about it later, but our basic argument is that it takes a long time to build effective markets and states.  [I learned that it also takes a long time to write a book, at least for us (~ 6 years).]

I’ve written before about how much I like what Andrew Mwenda, a Ugandan entrepreneur, has to say about development. He nails it again today in a post called Why South Korea succeeded where Uganda failed. He argues that there is a tinge of racism to the comparisons between East Asia and Sub-Saharan Africa–that is, implying that there is “something inherently wrong about Africa.”

Instead, he makes the excellent point that African countries have had a lot less experience than South Korea, for example, in creating an effective state and market.  He notes that “by 1960, South Korea had been in existence as a nation for over 600 years with a strong and centralised state, a common language and a shared consciousness of nationhood. There had been a brief interruption of Japanese colonialism from 1910 to 1945 (35 years). Therefore, the challenge facing Sigman Rhee and later Park Chang Hee, the military rulers in Seoul, was not nation or state building but economic reconstruction after the devastation brought about by the war with what later became North Korea.”

He contrasts this to Ghana and Uganda: “On the other hand, Ghana by 1960 had been born three years earlier, Uganda two years later. The immediate challenge facing Kwame Nkrumah and Milton Obote was to mould a nation from tens of disparate nations and tribes with different languages, cultures and sometimes hostility to each other.”

Uganda and South Korea also had very large differences in human capital in 1960:

“South Korea was endowed with rich institutional traditions based on meritocratic recruitment into the bureaucracy through an intensely competitive Public Administration entry exam known as the haengsi. By 1960, this tradition had been in place for 450 years. Japanese colonialism had actually relied on South Koreans to man the civil service. This gave it vital institutional memory, avoided resistance that comes with change in leadership, ensured supply of high quality expertise and a strong espirit de corp – assets that are intangible but valuable.” Also, by 1960, primary school enrolment in South Korea was 60% and secondary school 36%. Meanwhile, 12% of South Korean men and 4% of the women aged 18-21 were either in university or high technical institutions.”

As for Uganda, until 1957, “there were hardly any Ugandans in the top civil service jobs, the first one appointed to a top position in 1958. Although the British had introduced rich civil service traditions of meritocratic recruitment and promotion, few Africans were integrated into this culture and only in the last days of colonialism. The majority of Africans who served the colonial state were clerks and messengers. With the departure of colonialists at independence, every African with a good education but without experience and skills became a permanent secretary, a commissioner or head of a large public enterprise. As for education, primary school enrollment in 1961 was a 12 percent. Junior Secondary and Senior Secondary (S1 to S4) was less than one percent. And total enrollment in S5 to S6 was a mere 323 students. There were only 450 students in technical schools of all levels. Yet in spite of these miserable numbers, Uganda was among the most educated nations in Africa.”

I’d encourage you to read the whole article because this is just the tip of the iceberg–Mr. Mwenda makes many more excellent points on post-colonial African development.

 

2 thoughts on “Building an effective market and state

  1. Why did they still have the same per capita income in 1960, then, though?

    But aside from that, it’s an excellent piece. I particularly like how he pointed out that the heterogenous nature of most new African states made it difficult to get political consensus on almost anything except that the state should expand public services, and that same heterogenity (and inter-sub-state-group competition) meant that state socialism was warped into set-ups that tended to direct resources at particular groups at the expense of others.

  2. I really love/enjoy reading these articles because they genuinely help me in every way. I strongly believe that if we wish to be successful then we got to keep our self sharp, it’s the reason why I go with proper approach which is easier with broker like OctaFX, as they are too good with having low spreads from 0.1 pips to high leverage up to 1.500 while there is also daily updates given to me on the market which makes it even better.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s