New Africa macroeconomics blogging

Greg Smith is blogging at Ndoronomics.com - sharp analysis on macroeconomics in Ghana and elsewhere. Self-recommending.

Best charity in the world update

Depressing news from Givewell on the Against Malaria Foundation (AMF).

The good news: Givewell has directed $10m in the last 2 years to AMF. 

The bad news: This is a massive increase in scale for AMF, and they haven't yet managed to spend the money. This seems to be primarily because the transparency and accountability measures that help to make them such an attractive proposition for donors, also makes them a pretty unattractive proposition for implementers such as national governments. 

There's something about a sexy new NGO innovation which then runs into trouble when it tries to scale-up working through national government that sounds somehow familiar.

We shouldn't be too disheartened - this is hopefully just a set-back and the money will still eventually be spent. And it is still useful to model what good practice can look like even it is isn't replicated more widely immediately. But "room for more funding" - the capacity to implement at large scale, is clearly critical here. 

In the short-term this implies finding someone else to give your money to - your two best options seem to be Give Directly (tax deductible in the US) or the Schistosomiasis Control Initiative (tax deductible in both the US and UK, but with some concerns here) - neither of which seem to be entirely satisfactory for me as a UK-taxpayer. I'll wait for further comment from Givewell.

London bicycle stats

# cyclists killed in London in the past 2 weeks: 6
# police deployed to street corners in response, to patronise cyclists and warn them about cycling sensibly, wearing helmets, and listening to music: 2,500
% cyclists killed in London whilst breaking the law: 6%
% cyclists killed in London by a HGV turning left right into them: 50%
Average annual cycle deaths in Amsterdam (where most people don't wear helmets): 6
Average annual cycle deaths in Paris: 2

Kinshasa Kids

Best aeroplane movie I've seen in a while, following the adventures of some street kids in Kinshasa who start a rap group.

My favourite scene:

Kid 1: What I want is to start a music band so I can escape to Europe. 

Kid 2: I want to be a policeman so I can steal in peace. 

Kid 3: Ah, you have to be a politician to steal with ease!

Preach!

Really excellent stuff from Jishnu Das, tearing apart a recent Economist article on cash transfers:

recall that in welfare economics there are two rationales for government interventions to make people better off. First, governments fix market failures. ... Second, governments redistribute income by giving cash to the poor. ... Within this framework, giving cash always increases the welfare of the recipients; what we also worry about is the extent to which market failures circumscribe the ability of society to do better.

 ...

“does giving cash work well” is a well-defined question only if you are willing to say that “well” is something that WE, the donors, want to define for families whom we have never met and whose living circumstances we have probably never spent a day, let alone a lifetime, in. 

Has our hubris really taken us that far? What happened to respect for the poor? 

From there The Economist article degenerates, with “findings” that CCTs “work well” when the conditions are on things that people would not purchase without the conditions (I am serious; cut through the jargon, and that’s what it says). If by now you are tearing your hair out, join the club.

...

Health is not welfare, neither is education. So, can we please stop making judgments about what poor people should and should not do with money that is redistributed to them?

Problems with private schools

There were a few good comments on my Guardian piece the other week that are worth highlighting.

One of the most most important points is that when private schools get the same results as public schools for a fraction of the cost, they are still getting woefully bad, unacceptably poor learning outcomes.

Suvojit and Heather raise the issue that results are only going to be comparable when teacher effort can substitute for training - this is possible at lower grades but likely to get more difficult at higher grades with older children and more difficult material.

But neither of these for me damage the case for directly supporting private primary schools if they are still doing the same job substantially cheaper.

A criticism that might do this is one that Anurag Behar (CEO of the Azim Premji Foundation, a leading organisation on education research) makes in a Mint column, which strikes at the heart of the private school business model. His argument is that private school teachers only accept such low wages because they are "queueing" for a government teacher job.

It’s clear that the salaries of teachers in most such private schools are very low, bordering on the exploitative. The reasons why they get teachers at these salaries are fairly simple. Most of those who join private schools as teachers are those who are waiting and trying to join government schools. Since recruitment of government teachers has its own pace and scale (though it has become “cleaner” in many states), many keep waiting and trying for years, and it’s this lot that largely feeds the private schools. Eventually of those who don’t make it to the government system, many leave teaching to do other things, which is not surprising, given their salaries.

One reason to doubt this story is that if those private school teachers are unqualified then they aren't eligible for a government teacher job. But I'm open to persuasion if there is any data here?

Development as Burritos

This one has been sitting in my drafts folder for months, but Hausmann just got me thinking about it again.

"Meze Fresh" is probably one of the best places to eat in Kigali. Certainly one of the fastest. It's a Chipotle-style Mexican place, with a range of salads, meats, salsas, and sauces in a bar at the front that are thrown together in a tortilla in no time at all. Plus they do margaritas. The owner, I'm told, is a young American guy in his 20s who worked in a Chipotle back home in California, and basically borrowed the entire concept and replicated it here. A similar thing is going on with the Office, or with the young Americans in Kigali setting up their own gyms and solar energy businesses.

To some extent, that is what development is. Borrowing ideas. At least that's what catch-up growth is. At the world technological frontier you need to invent new ideas to get economic growth, but for most developing countries you can get a long way just copying other ideas.

Hausmann's point is that it takes people to transfer ideas, because it's really hard to teach people things that depend upon learning by doing. Which resonates with the experience of all these expats in Kigali who came to do traditional aid work, decided they liked living there, and started spotting all these business opportunities based on ideas from back home. The policy implications of this? For developing countries, one is to make it really easy for people to come visit and live in your country. Rwanda is doing this. The kind of bureaucracy and visa fees you find in many other countries is just incredibly short-sighted.

I'm also reminded of another Hausmann contribution - growth diagnostics. In a place like Rwanda, having got the basics of physical security, macroeconomic stability, decent government administration, and infrastructure under control, one of the things that might start to bind as a constraint to growth is "information externalities."

Any suggestions for what any of this implies for donor policy? Can we and would we want to increase subsidies for foreign investment?

The Mr. Miyagi Theory of Economic Development

Very interesting hypothesis from Ricardo Hausmann on Project Syndicate.

The bottom line is that urbanization, schooling, and Internet access are woefully insufficient to transmit effectively the tacit knowledge required to be productive. That is why today’s emerging markets are so much less productive than rich countries were in 1960, even though the latter were less urban, had higher birth rates and less formal schooling, and used much older technologies. 

The policy implications are clear. Knowhow resides in brains, and emerging and developing countries should focus on attracting them, instead of erecting barriers to skilled immigration. They should tap into their diasporas, attract foreign direct investment in new areas, and acquire foreign firms if possible. Knowledge moves when people do.

The Karate Kid reference is from the very entertaining powerpoint here.

South Sudan: Safer (for aid workers) than detroit?

"There are 17,000 aid workers in South Sudan, making it one of the largest aid operations in the world. In 2012 there were 25 major attacks on aid workers ... With 9 murders of aid workers, that puts the aid worker murder rate in South Sudan at 53 per 100,000. How does this compare to the murder rates of other places?" 

From Aid Leap

How to fix education in developing countries

Annie Lowrey interviews Lant Pritchett in the NYT, who argues

1. We need to think about the whole system rather than just single interventions
2. We need clear goals in terms of learning outcomes, what we are trying to achieve
3. We need local flexibility to come up with solutions to achieve those clearly agreed goals

I'm struck that if we believe this (and I think I do), then effective management of systems of public service delivery looks a lot like effective management of individual people - set clear outcome goals but don't micromanage the process.

Well worth reading in full.

On private schools, Lant has this to say:

"You can get local control by increasing the number of private schools — I’m not advocating privatization as a solution, but those private schools are freed from being in a top-down bureaucracy, and in India and Pakistan, they do better with less resources."

Some of my best friends are knee-jerk leftists

I wrote a thing for the Guardian blog defending aid in support of private schools in developing countries. Which is very exciting because I've been reading the Guardian every day since I was 16. Some of the comments are a bit colourful, so for the record I feel I should burnish my lefty credentials (even though this feels really lame as it's exactly the kind of thing that annoys me when the likes of Goodhart and Collier do it before they go on to support mainstream Conservative party opinion).  

But for what it's worth, I started my lefty career when I was 6, when my "Dennis the Menace fan club says no Gulf war" poster made it to the local news. I went campaigning door-to-door for the Labour party when I was 8. I wrote to the Green party asking for a copy of their manifesto when I was 10. When I was 15 I vandalised the Conservative party billboard in my neighbourhood, and volunteered for a local Labour MP when I was 17.

I'm proud of having attended my local comprehensive school in Leeds. I'm proud that my fiercely liberal granddad sent my mum to the local comprehensive school on principle, instead of the more conveniently located selective school. I'm proud of my mum who was a school teacher for 20 years, and my aunt and uncle and grandparents, who all work or worked for the NHS (which yes, I'm also proud of).

I worry a lot about private schools in the UK, and the consequences for social mobility and segregation. 

So I'm not a natural supporter of private schools. But I care about evidence - and my reading of it is that there is a great potential to do good by experimenting with private sector service provision in education in developing countries. (Many other intelligent people, including several colleagues - none of whom are knee-jerk leftists - disagree with me, but thankfully none of them have yet accused me of "plain bullshit", "neo-con mantra", being a Mugabe-apologist, or a "twat.")

India fact of the day

In India, remittances are larger than the country’s earnings from IT exports.

From Dilip Ratha 

A naked man in a tie

My favourite description of the country came from Souleiman Youssouf, a 35-year-old Somalilander who lives and works in Canada but tries to visit every year. “Somaliland is a naked man in a tie,” he told me, in a vivid reference to the way the country spans extremes of development. Ageing nomads still walk the plains with their camels, but they can also call the US at cheap rates on the territory’s extremely competitive and successful mobile telephone networks. And although no other territory in the world recognises it, Somaliland strives to run itself as any other nation-state. It holds elections, passes laws and collects taxes – however meagre – and has developed an impressive clutch of commercial mobile phone, mobile internet and money transfer services.

From Katrina Manson's notes on her visit to the 6th Annual Hargeisa International Book Fair. My favourite short story about economics set in Hargeisa is here.

How to switch careers into international development

A 6-part guide from Rachel Strohm (formerly of IPA and other things):

1. What is development
2. What interests you
3. Building transferable skills
4. Unpaid internships
5. What to do if you can't go unpaid
6. CVs and cover letters

And whilst I'm on the subject - a plug for an exciting new job for a social science PhD to work with OPM and the University of Bath to develop better ways of integrating quantitative and qualitative methods in development policy impact evaluation.