i think you need to look at things more regionally. like with respect to africa (which i know a good amount about) it seems to go back to the prevalence of tribalism and indirect colonial rule from the euros. like a good portion of sub-saharan africa is resource rich, but it is often only controlled by the few in power. hunger can also be related to this in a way because before colonialism these tribes in africa would migrate some to where the agriculture was better since the weather is not static. so when the countries were created this hurt the people in these regions. i dunno just a couple quick things i can think of.
Thank you Mr. Kennison The answer would be a long dissertaion on the evolution of culture and civilization as effected by migration, climate, catastrophy and religion. But briefly in warmer climes of natural abundance there is less need to cooperate, innovate and trade. This allows for the development of more insular tribal cultures with a strict hierarchy of power. As man migrated north to more rigorous climates more cooperation was a necessity and that requires the development of rules for interaction, government if you will, and a system to apply relative values to goods, money. The ability for larger numbers of men to gain wealth sets off the chain of education and innovation and democratization. There you have it , 10,000 years of culture in a fractured paragraph.
I don't think there is really any one single issue that makes a country poor and its hard to generalize. I think there are a variety of factors and most poor countries seem to suffer from at least two of those factors. Education - Obviously an educated populace is a huge benefit because that means they are more capable of doing more value added work. Also though in a better educated populace there are more problem solvers to improve the overall economy and society. As another poster pointed out though Eastern European countries have high levels of education but still aren't prospering and without opportunities to use that education its not going to do that much good. Natural Resources - Very helpful in that there is a ready source of capital. Unfortunately though without good management natural resources do very little for the country overall and only end up getting siphoned off by an elite or sent out of the country. Nigeria, Zimbabwe, Congo, Myanmar and many other Third World countries have far more natural resources than most First World countries yet they remain economic basketcase. Singapore has no natural resources and is thriving and according to many Singaporeans there lack of resources helped motivate them to become more successful. Trade and Finance - Looking at Singapore and the other Asian Tigers trade has been key to their success. Singapore deliberately took the route of almost complete liberalization of their trade policies and made themselves into one of the greatest ports and banking centers in the World along with having a manufacturing base far greater than their size would indicate. Glynch has pointed out the problems with the international trade and finance and how in many cases it has caused a lot of problems in developing countries so I won't go into that but without trade and international finance there is little incentive to move capital from the developed to the developing world. Good Governance - As a country like Nigeria shows you can have lots of natural resources yet still be poor if there is a lack of good governance. Not only will capital be looted but inefficiencies from bureaucracy and corruption discourage investment into the economy and also hinder the entrepeneural spirit of the people to generate income. Good governance though doesn't guarentee wealth though because there are countries like Mozambique, Botswana and Ghana that have relatively good governance but are still considered poor. You can have a great government but without resources, education, or trade there's nothing to build a successful economy off of. At the same time there are corrupt or dicatatorial governments that on sheer wealth have been able to deliver a high standard of living. Even though Saddam was a ruthless dictator at his height of power the average Iraqi had a better material standard of living than many other countries. Health - Without a healthy population there aren't going to be the workers to produce capital and many economist have calculated the potential affects of health crisises like AIDS and malnutrition have on world economies. Depending though on how large the population base is though you can still have a generally unhealthy population yet still produce a lot of capital. Overall the Chinese and Indian population has a lot of health problems yet since the countries have such large populations they can overcome those. Infrastructure - Its hard to develop industries that add a lot of value to a country's GDP without basic infrastructure. This was something that many of the Asian Tigers realized which was why the emphasized industrial and basic infrastructure in their development. Of course the Soviets built a lot of industry and infrastructure in many of the former Soviet Republics and NK also built a lot of industry but that hasn't kept them from being poor. Stability - This goes along with good governance but also includes lack of internal or external pressures like insurgencies, wars, natural disasters or getting swamped with refugees. Its difficult to maintain a functioning economy while fighting a war, dealing with natural disasters or when your own social systems are being swamped by refugees fleeing war or natural disaster. Again as Saddam showed its not impossible and even during the height of the Iran / Iraq war Iraq still was providing a higher standard of living than many countries. A lot of this has to do with how bad the war or disasters is and when a war or disaster gets bad a lot of the other factors like trade, infrastructure and health go down.
That's true to a point but if you look at Chinese history just developing a monetary system and a government provides prosperity greater than hunter gatherer societies but also can lead to ossification and an inability to innovate to create capital. Chinese civilization was based upon growing rice and flood control both of which required a high degree of organization leading to ordered government system. As the smaller Chinese kingdoms became absorbed into dynastic empires the governmental systems grew into larger and larger bureaucracies that eventually caused the empires to collapse under corrupt and inefficient governments leading back to the cycle of small kingdoms to dynastic empires. The problem was that even though there was cyclic turmoil there was little impetus to innovate. In Europe from the 15th C. onwards there was a huge amount of competition between smaller political entities that drove them to innovate with no country since the Holy Roman Empire able to dominate Europe for any signifigant time. Europe's paucity of resources also drove Europeans to aggressively seek more resources, through trade and war. So while the Chinese looked inward the Europeans looked outward and took the lessons they learned from fighting and trading with each other to the rest of the World leading to the World we have today.
Historical legacy is a huge factor. Europeans created the prototype for a world trade system as far back as the early 1500's. Their usages of imperialism, colonialism, and mercantilism affect us to this very day. For example, during the era of the conquistadors, the silver market became overflooded and its inflated supply reached as far away as China. Such transfer/exploitation of wealth and resources was never regained in those Latin American countries. Africa has been long exploited for its labor and resources. Plus, imperialistic powers strategically marginalized some countries main export to impede their development. Countries like Ethiopia and Egypt were very competitive in cotton and other cash crops, but European powers, eager to monopolize their emerging industrial textile industry, forced restrictive arrangements or even wars to keep that raw material flowing and to impede those African countries industrial development. As an aside, if you look further back into Africa, several states had their own skilled workers, made firearms, and had flourishing trade routes. What happened? They fell victim to constant intertribal warfare, and they underestimated sea trade. This allowed Euros, who could never have launched a land assault until the 1800s, to exploit tensions and control the harbors. What could be interesting for other countries is why Japan isn't poor now? They were even more xenophobic than China before Commodore Perry. A subsequent bloody civil war left cities and their established hierarchy in ruins. It has no substantial natural resource other than coal. How did it become an imperialistic power so quickly? Their new leadership gained key insights into western industrialization. First they followed the West and focused upon their textile industry and exports. Their silk clothes and intricate designs were a popular export. Plus they had other exports such as high quality swords for war and Asian crap rich Europeans love in their houses. Their stable export industry allowed and sustained a middle class. Previous farmers and sharecroppers became richer and new market venues developed. Compare this angle with countries you see today and think should be rich...countries that are rich in oil, gold, diamonds, or some other raw resource. What's the catch? The wealth is unevenly distributed. Even through state owned corporations, the shared wealth is not sustainable. Corruption and overhead assume the main focus upon short sighted/greedy governments. Government planning in infrastructure neglects the boom in population/added expense/services from the added wealth. Unsustainability is magnified. Most importantly, the country's economy and budget is highly vulnerable to the price of the country's main export. Not only market demand, but speculation and panic would cripple a state in months. This all assumes their national resource is infinite. Even if so, market fluctuations causes deficits. Country overborrows. It doesn't even take account dictatorial or inept leaders who placate the public with costly civil services. Then...when the pustule pops, very rarely does it get cleaned up in-state. Successful idealistic revolutionaries get that unique opportunity to weigh how much their idealism is worth compared to that pile of cash sitting under his newly controlled soil.... It was textiles that fueled the industrial revolution. They made factories to mass produce clothes... not rifles, clocks, or other machinery. If you made a factory for high end stuff, who do you sell it to when your people aren't rich enough to buy it? What foreigner would trust your brand over their own domestic brand? These poor country planners didn't realize that they could leap frog into modernity. Even a high education system won't mean anything, if there's an employment exodus caused from other high paying modernized countries with an established middle class. This is why agricultural tariffs and subsidies is extremely contested to this day. Poor countries have mainly poor people. Poor people are mainly farmers and sharecroppers. Industrialized countries kill the poor countries' cash crop by artificially deflating the domestic value of their own competing crops. Back to Japanese history... The economic infrastructure is growing. The leadership is decisive. Usually dissent from nobility would ruin any populist governing. Japan gave a golden handshake to willing samurai who supported the new government. They established service monopolies, corporate grafts, everything in the backdoor fatcat book to government/business cooperation. Also, Japan's culture is very unique in that the entrie population took faith in the established heirarchy for the good of their state. That extreme nationalism quashed most dissent and rebellion usually given in resistance to social change, and its nationalism gave the Japanese people a common goal, to avoid humiliation by imperialist powers. Japan only had coal and few other valuable resources. What was their big secret to their "miracle"? Japan stole from China in a series of wars. The most notorious of the unfair treaties is the Treaty of Shimonoseki. They forced China to pay heavily (also took land in the form of Korea and Taiwan), used the funds up to build up their infrastructure...then started more wars China to start over again. So not only did Japan enjoy being largely ignored by imperialists from living in China's shadow, Japan used an inept Chinese government to fund its own ambitions. After WW2, the second "Japanese miracle" became eventually overshadowed the previous, but it took the infrrastructure and the successful culture of the first to make it possible. It was by no means a miracle. Japanese leaders planned and executed like none other, and they found the perfect blueprint from western European countries. If that blueprint unfair or unrealistic to other poor countries now, we're still playing the same game Europeans invented 500 years before.
I think that's the biggest thing. You have leaders whose primary goal is simply to enrich themselves. If they are unconcerned with the well-being of their citizens, nothing good is going to happen. And when a revolutionary comes along and promises improvements, they slowly get corrupted and repeat the cycle. How many times have we seen international aid that just never gets to the people it needs to reach? Where warlords simply take it and use it as a way to make citizens dependent on them? The problem starts here in my opinion. Beyond that, certainly the methods we use don't help. This whole process of loans and loan forgiveness is well-intentioned but is truly counterproductive. It leads to those countries having some terrible economic policies. Free trade, while a good thing in general, also can have negative repercussions for a country just trying to get industry started to create jobs. Everyone talks about the simplistic idea of comparative advantage, and that's great when 2 countries are involved, but when you have 50, it simply doesn't work the same. Some of these countries, in the short term, do need protectionism to get on their feet. Once their economy doesn't have 50+% unemployment and such, adding in free trade will then benefit them more.
What InvisibleFan said... A short answer would pretty much be corruption/power struggles of leaders resulting in an unstable government, thus creating: lack of/weak property rights, corruption, poor legal systems, poor educational systems which lead to a low specialization and man power in the work force. There are many other reasons varying from country to country, but what is important to note is that natural resources is NEVER a legitimate excuse.
I'd have to disagree in that I think a country can accumulate GDP growth without resources (although we might have a different definition of the word resource). How many resources does Hong Kong have compared to, say Russia?
Rocket River, this will give you far more substantive information than you will receive from the conjecture in this thread, happy reading: Guns, Germs & Steel
Lack of education. Lack of resources. Exploitation from their government or another nation at one point in time. Some nations can only cultivate certain crops because their soil is ideal for them. Afghanistan for example has soil that is ideal for Opium, but nothing else. Some nations can only make an income from tourism. The big one is resources which the US has the biggest advantage out of any other nation. The only continent, not nation, that could match us would be Africa and they're doing horribly because of a corrupted government, lack of education, and disease. If they ever got their act together, they could compete with the US. Historically the US has had a wealth of resources to develop this great nation that others did not have. The Great Plains specifically, but other fertile soil that was specifically better for certain crops. We have enough crops to feed the world sold because of our land. No other nation has fertile soil the way we do. We had oil that was plentiful at one point. We had coal which was really viable at one point, and still is. We had the gold rush. There are others I can't remember off the top of my head. Most other nations don't have anywhere close to the resources we have. We're also a melting pot of all different races. Our government has remained fairly untainted constitutionally, and has come a long way culturally that other nations are still lagging behind in. We used to attract the world's best and brightest into our nation. It's not the same presently, but we still attract some of the best.
Lack of political and cultural stability and unity over a large scale for a long period of time, lack of interaction and engagement with other civilizations on a level or favorable playing field, and a diminished emphasis on education, technology, capitalism and equality (because you end up underutilizing human capital).
I'm surprised so many here are touting a lack of resources as a major factor. The "resource curse" is pretty accepted among political science scholars in the feild of economic development. Now resources certainly do not preclude a country from developing its economy (see: the United States), but the majority of these "trust fund states" are typically impaired from their own natural wealth, counterintuitively. If a country can rely on its own resources for revenue, it doesn't have to tax its citizenry, and in turn does not need to show any accountability in the governing process. On the other hand, a country without resources has to take steps to develop its economy and tax its citizenry for atleast some percentage of its revenues. In turn, there is accountability, and an empowered, educated middle class with some degree of oversight. The cycle continues to further economic development.
