1 Introduction 2 Political and Social Context of Economic Development

Notes 1 Introduction 1. I will discuss the links between economic growth and poverty alleviation in later chapters of the book. 2. The writings of Sen, Adelman, Morris and Abramowitz provide illustrative examples of the call for alternative explanations for Africa’s poverty. 3. Distinction is now drawn in the economic literature between nominal and real GDP. Nominal GDP is the sum value of all produced goods and services at current prices. This measure does have its uses. Real GDP is the sum value of all produced goods and services at constant prices and is indicative of how average living standards change over time. 4. See The Economist (2011) “Africa’s Hopeful Economies”. Available at http:// www.economist.com/node/21541008, Accessed on 17–02–2014. 5. This description was contained in a speech that Robert McNamara gave in Nairobi, Kenya in 1993. See Alacevich (2007). 6. This perspective runs counter to the endogenous sociocultural resource argu- ment endorsed in this book. As subsequent discussions will reveal, I do not believe that copying Western values will produce sustainable economic development in SSA. 2 Political and Social Context of Economic Development in Sub-Saharan Africa 1. By the beginning of the 1980s, there were over 30 coups in the subcontinent, with the Togolese coup in 1963 being the first (Panabel, 1984). 2. Accounts showed that groundnut oil mills were set up in Senegal in 1927 and began exports to France. They were soon placed under restrictions because of the protests of oil millers in France. Similarly in Nigeria, the oil mills set up by Lebanese were discouraged. 3. Several of the leaders were trained in England and the United States; they acquired taste for Western life and accoutrements of office and social pleasure that they were unwilling to relinquish for the sake of creating political capital. 4. http://www3.weforum.org/docs/WEF_GCR_Report_2011-12.pdf 5. The GCI Report 2011–2012 on Sub-Saharan countries published by the World Economic Forum ranked Ghana 12 out of 30 countries (after South Africa, Mauritius, Rwanda, Botswana, Namibia, Gambia, Kenya, Benin, Ethiopia, Senegal and Zambia). In West Africa, Ghana ranks four after Gambia, Benin and Senegal ahead of its neighbours Cote d’Ivoire (129), Burkina Faso (136) and its biggest competitor Nigeria (127). The report further commends Ghana for exhibiting strong public institutional and governance capabilities with rel- atively high government efficiency, particularly by regional comparison. See http://www3.weforum.org/docs/WEF_GCR_Report_2011-12.pdf 224 Notes 225 6. German emperor decorated von Trotha after his return to Germany for devo- tion to the fatherland. It was not until August 2004 that Germany offered formal apology but refused to pay compensation for victims’ descendants. 7. For example, Namibia is the world’s fourth largest producer of uranium. Rich alluvial diamond deposits also make the country a primary source for gem- quality diamonds. It also produces large quantities of zinc and is a small producer of gold and other minerals. 3 Explaining Africa’s Recent Economic Growth Experiences 1. For example, oil rose from less than $20 a barrel in 1999 to more than $145 in 2008. Recent fall in oil prices is clear evidence of the dangers of depending on commodities to finance economic growth. 2. See The Economist (2011) “Africa’s Hopeful Economies”, Available at http:// www.economist.com/node/21541008. Accessed on 17–02–2014. 3. According to The Information Office of the State Council, China’s share of Africa’s total foreign trade volume in 2000 was 3.82%. This increased to 16.13% in 2012. See Beijing, August 29 (Xinhua) 2013. 4. According to Lemma (2012), remittance flows to Africa have exceeded offi- cial aid and amount to approximately $200 billion between 2007 and 2011. 4 Contemporary Perspectives on Economic Growth and Development 1. These models acknowledge the centrality of agriculture during the initial stages of economic growth. 2. It is however surprising to note that agriculture has been conspicuously neglected in all World Bank-supported economic development efforts in Africa. As Phillips (2013:19) observes, despite its centrality in the alleviation of poverty the World Bank’s 2008 World Development Report was the first one to focus on agriculture for 26 years. But while agriculture is back on the donor’s rhetorical agenda there is a long way to go in terms of action. In 2009 and 2010 agriculture still took a historically low share of World Bank lending In the 1970s, agriculture averaged 28% of total World Bank lending. But it fell to 15% in the mid-1980s. 3. This hypothesis is highly contested in the literature due to the effrontery connotations it carries. 4. The term institution has featured prominently in the development economics literature under many different labels including the following: “economic institutions,” “structural policies,” “growth promoting policies” and “social infrastructure” (see Eicher and Rohn, 2007, for elaborations). 226 Notes 5 The Human Factor in Economic Development 1. Sen’s capability approach has emerged as a flexible and multipurpose framework, widely applied in pro-poor policy studies. Whitley’s national business systems concept discussed in Chapters 3 and 13 also presents similar argu- ments. But the capability concept adopted in this book is anchored on the notion of the individual’s development as a creative human being in a social context. This perspective differs from contemporary uses of the term in both Sen and Whitley’s studies. 2. See various issues of UNDP human development reports. 3. nAchis a term McClelland used to describe need achievers. 4. See Harrison, L (2006) The Central Liberal Truth (New York and Oxford: Oxford University Press), p.128. 5. The World Bank has created Country Policy and Institutional Assessment (CPIA) framework that it uses to measure institutional quality in different countries of the world. The CPIA is intended to capture the quality of a country’s policies and institutions and is measured annually for all countries borrowing from the World Bank. It has evolved into a set of 16 criteria that are grouped in four clusters: (i) economic management; (ii) structural policies; (iii) policies for social inclusion and equity; and (iv) public-sector management and institutions. 6 Culture and Its Relevance to Economic Development Discourses 1. Gullestrup (2006) offers eight-dimensional typology of culture. These are as follows: social dimension, identity-creating dimension, security- creating dimension, management and decision-making dimension, integration dimension, conveyance dimension, distribution dimension and process- ing dimension. 2. Acemoglu et al. (2003) draw a distinction between “predatory/extractive” and “developmental/inclusive” institutions. Predatory institutions allow the minority in power to use its power to prey upon economic agents, thereby reducing the latter’s incentive to invest and produce. Developmental institutions, by contrast, encourage development and growth by providing a “helping hand” to private agents, providing public goods like education, infrastructure and incentives to invest. 3. The requirements listed here have been inspired by Gullestrup’s discussion of change-determining factors. But I have used the terms in a way slightly different from Gullestrup’s original presentation. 14 Entrepreneurial Activities in Africa: Opportunities and Challenges 1. These illustrative examples have been drawn from Freidberg’s (1997) inves- tigation of entrepreneurial activities of some well-connected individuals in Burkina Faso. Notes 227 16 Regionalization and Economic Integration 1. The term “region” in economic literature has two broad meanings. It may mean the area (city, urban) in the same country or a composite part of a larger economic social space, which differs from other surrounding territories in economic, social, demographic, cultural, natural and infrastructural systems connected by material and informational relations. It may also mean a group of nations that create a specific social, economic and technological space. 2. Learning in this sense refers to the building of new competencies and the acquisition of new skills, not just gaining access to information. 17 Reflections, Conclusions and the Way Forward 1. In 2010, six out of the ten most unequal countries worldwide were in Sub-Saharan Africa (see Briefing Notes for AfDB’s Long-Term Strategy). Available at http://www.afdb.org/fileadmin/uploads/afdb/Documents/Policy- Documents/ Accessed on 5 May 2014. Bibliography Abdellatif, M., Amann, B. and Jaussaud, J. (2010) “Family versus nonfamily business: a comparison of international strategies”, Journal of Family Business Strategy, Vol. 1, No. 2, pp. 108–116. Abramowitz, Moses (1986) “Catching up, forging ahead, and falling behind”, Journal of Economic History, Vol. 46, No. 2, pp. 385–406. Acemoglu, D., Johnson, S. and Robinson, J. A. (2001) “The colonial origins of comparative development”, American Economic Review, Vol. 91, pp. 1369–1401. Acemoglu, D., Johnson S., Robinson J. A. and Yunyong Thaicharoen (2003) “Institutional causes, macroeconomic symptoms: volatility, crises and growth”, Journal of Monetary Economics, Vol. 50, January, pp. 49–123. Acemoglu, D. and Robinson, J. A. (2012) Why Nations Fail (New York: Crown Business). Adelman, Irma (1958) Theories of Economic Growth and Development (Stanford: Stanford University Press). Adelman, Irma (1974) “Korea”, in Chenery Hollis, Montek Ahluwalia, Clive Bell, Jack Duloy and Richard

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