A preview of the unpublished book A CIVILIZATION WITHOUT A VISION WILL PERISH: AN INDEPENDENT SEARCH FOR THE TRUTH by David Willis. CHAPTER 1: INDIFFERENCE TO POVERTY (Part 50). This blog is a continuation of the review of The End of Poverty: How We Can Make it Happen in Our Life Time, by Jeffrey Sachs, published in 2005
Chapter 4: Clinical economics
The rich world dominates the training of Ph.D. economists, and the students of rich-world Ph.D. programs dominate the international institutions like the International Monetary Fund (IMF) and the World Bank, which have the lead in advising poor countries on how to break out of poverty. These economists are bright and motivated. I know. I have trained many of them. But do the institutions where they work think correctly about the problems of the countries in which they operate? The answer is no. Development economics needs an overhaul in order to be much more like modern medicine, a profession of rigor, insight, and practicality.
SOME LESSONS OF CLINICAL MEDICINE
Lesson 1 is that the human body is a complex system
Lesson 2 is that complexity requires a differential diagnosis
Lesson 3 is that all medicine is family medicine
Lesson 4 is that monitoring and evaluation are essential
Lesson 5 is that medicine is a profession
DEVELOPMENT ECONOMICS AS CLINICAL ECONOMICS
The challenge of making policy recommendations for an economy, especially a poor and unstable economy, shares many of the challenges of clinical medicine. Yet the practice of development economics is not yet up to the task. The five key lessons of clinical medicine have clear counterparts in good economics practice as well.
Economies are complex systems
First, economies, like individuals, are complex systems. Like the circulatory, respiratory, and other systems of a human being, societies have distinct systems for transport, power, communications, law enforcement, national defense, taxation, and other systems that must operate properly for the entire economy to function appropriately. As with a human being, the failure of one system can lead to cascades of failure in other parts of the economy.
Economists need to learn the art of differential diagnosis
Second, economists, like medical clinicians, need to learn the art of differential diagnosis. The IMF has focused on a very narrow range of issues, such as corruption, barriers to private enterprise, budget deficits, and state ownership of production. It has also presumed that each episode of fever is just like the others, and has trotted out standardized advice to cut budgets, liberalize trade, and privatize state-owned enterprises, almost without regard to the specific context.
The IMF has overlooked urgent problems
The IMF has overlooked urgent problems involving poverty traps, agronomy, climate, disease, transport, gender, and a host of other pathologies that undermine economic development. Clinical economics should train the development practitioner to home in much more effectively on the key underlying causes of economic distress, and to prescribe appropriate remedies that are well tailored to each country’s specific conditions.
The entire world community is part of the family
Third, clinical economics, like clinical medicine, should view treatment in “family” terms, not just individual terms. In the case of a country, the entire world community is part of the family. That is an assumption of the Millennium Development Goals, and especially the concept of a global partnership to achieve the goals, but it is not yet part of real clinical practice.
Monitoring and evaluation
Fourth, good development practice requires monitoring and evaluation, and especially a rigorous comparison of goals and outcomes. When goals are not being achieved, it is important to ask why, not to make excuses for past advice. The local priest gives one remedy after another – prayers, potions, oaths – until all of the chickens are dead. “Too bad,” says the priest, “I had so many other good ideas.”
Ethical and professional standards
Fifth, the development community lacks the requisite ethical and professional standards. I am not suggesting that development practitioners are corrupt or unethical; such cases are rare. Rather, the development economics community does not take on its work with the sense of responsibility that the tasks require.
A profound commitment to search for the right answers
Providing economic advice to others requires a profound commitment to search for the right answers, not to settle for superficial approaches. It requires a commitment to be thoroughly steeped in the history, ethnography, politics, and economics of any place where the professional adviser is working. Any IMF or World Bank official, as well as any academic development practitioner, has the responsibility to speak truth not only to the policy makers within the impoverished country, but to the policy makers of the rich and powerful countries as well.