From the Coffee House to the World Bank - Institutions and Development

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peter bauer.jpg Over the weekend I watched a conference series held at Princeton University in honour of Peter Bauer, a pioneer in the field of development economics. His view of development could be characterized as;

I regard the extension of the range of choice, that is, an increase in the range of effective alternatives to the people, as the principal objective and criterion of economic development; and I judge a measure principally by its probable effects on the range of alternatives open to individuals.
(quoted in Amartya Sen, Development as Freedom, p.290)

I liked his critique of the prevailing economic development theories and highlighting the significance of non-economic variables for development. His colleague and friend Basil Yamey explained;

Peter emphasized the importance for economic advance of the attributes, attitudes, and mores of people and groups. He had observed this at first hand in his studies of the multiethnic societies of Malaya and West Africa…

Peter often spoke about a small but telling example. In Malaya he examined the records of the output of individual rubber tappers on a number of plantations. He found reliable records for several estates running over longish periods. He found, consistently, that Chinese tappers produced more tapped latex than their Malay and Indian counterparts. Yet, apart from their ethnic origin, the tappers were otherwise about as identical as one could hope to find for a sort of laboratory experiment in economics. They all used the same simple tools; and the co-operant factors of production were the same. They had virtually no formal education.

In the same context, Peter also sometimes mentioned a rather different example, with the same implications. During the troubles in Malaya, Chinese bandits betrayed their ethnic affiliation when they sacked a village. They were far more thorough and efficient than other bandits when they carried out their work. The difference in performance was visible.

On foreign aid, Peter declared “an excellent method for transferring money from poor people in rich countries to rich people in poor countries.” And he was very critical of population control; worries about population growth reflect a patronising view that the poor are incapable of making sensible choices about having children.

Chris at The Austrian Economists blog who attended the session has some advice for budding Austrian economists;

If the opportunity presents itself, the younger generation of Austrians should observe the way Kirzner carries himself. He is the consummate scholar. Kirzner's ability to articulate Austrian ideas and engage the likes of Amartya Sen on these issues serves as an important example of how to interact with those in the profession who aren't necessarily sympathetic to Austrian insights. I have had the opportunity to see Kirzner on several occasions and have learned important lessons each time from simply observing how he presents his ideas and interacts with others.

Some links to best of the sessions from the conference (requires broadband, 300K);

Basil Yamey: "Peter Bauer and Development Economics"

Chairman: James Buchanan; Speakers: Basil Yamey, Amartya Sen, Israel Kirzner: "SESSION 1: Resources? Institutions? Attitudes? - How Does Development Happen?"


Chairman: Amartya Sen; Speakers: Speakers: James Buchanan, Douglass North, John McGinnis; Discussant: Mary O'Grady: "SESSION 3: From the Coffee House to the World Bank - Institutions and Development"

Chairman: Herbert London; Speakers: Allan Meltzer, Enrique Ghersi, Razeen Sally; Discussant: William Niskanen: "SESSION 2: 'Seek Ye First the Political Kingdom' - Democracy, Equality and Development"

Milton Friedman and Thomas Sowell: "Peter Bauer and his Ideas"


Related Links; A Tribute to Peter Bauer at Institute of Economics Affairs, Pioneers of Development, Frontiers of Development Economics, An interview with Peter Bauer and Israel Kirzner.

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Peter Bauer from De Gustibus Non Est Disputandum on February 27, 2006 3:12 PM

Olha leitor, agora é sério. Se nosso país fosse realmente um feudo do neoliberalismo burguês-globalizante-excludente, então você deveria ter ouvido falar de Peter Bauer. Diga-me com sinceridade: (i) você já havia ouvido falar dele antes de sua ... Read More

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Hi, thank you very much for the link to my blog http://www.subsolo.org/gustibus/
Just a minor correction: it is written in Portuguese, not Spanish, by two brazilian economists.

Yours,

Leo

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