Why have China and Ghana achieved impressive growth and poverty reduction while Nigeria has seen an increase in poverty even as its economy grew to be the largest in Africa? The answer to this question lies in the relationships between the poor and elites, and specifically in patterns of social inclusion and exclusion. That is the conclusion reached by Seth Kaplan in his book Betrayed: Politics, Power, and Prosperity, based on a study of scholarly literature and personal observations in developing countries. Without a doubt, inclusion presents a fundamental challenge of development, and Kaplan has dug down to frame the core of the problem.
Kaplan makes an argument in two parts, which are linked by political economy. He focuses on the poor as primary developmental actors, stating that their own actions do most to transform their lives. Their actions are conditional upon being given opportunity, however, and in fact the poor usually are excluded from opportunity. The origins of social exclusion, in turn, may be found in a combination of weak governance and social cleavages, which promote a politics of narrow self interest instead of national development.
It is refreshing to see Kaplan keep the focus on growth in “inclusive growth.” Although often taken for granted, growth is the mechanism for creating jobs and raising government revenues. The challenge is to achieve high-quality, sustainable growth that increases productivity while expanding opportunity. In this regard, access to markets empowers the poor. A business environment that reduces costs, and establishes free and fair markets, creates incentives for taking initiative and creating jobs. By contrast, elite capture of markets discourages initiative and disenfranchises much of the population.
Effective and inclusive governments play essential roles in providing legal protections, investments in education and infrastructure, and policies for broad-based growth. Here the challenge begins with state capacity building and extends to building pressure for accountability in government. Kaplan calls for leadership from all levels of society—including political leadership, civic leadership, and business leadership—to push towards a more inclusive system. Political development helps, but does not guarantee, the emergence of an inclusive development agenda.
Betrayed does not expect all good things to come together in the short run in developing countries, and thus suggests a range of strategies to promote inclusiveness in varying circumstances, including authoritarian systems. In this sense, it resembles other recent work such as Brian Levy’s Working with the Grain: Integrating Governance and Growth in Development Strategies. While I applaud the pragmatic approach to fostering inclusiveness, I would encourage practitioners to keep democracy and anti-corruption in their sights as they navigate the twists and turns of development. Both matter to the poor, even in the shorter run, as these factors influence their ability to have a voice and secure their livelihoods.
Kim Bettcher is Senior Knowledge Manager at CIPE.
Published Date: January 05, 2015