Why are some countries more developed than others? Who is responsible for changing the current situation?

Week 2–Part 1

Exercise 4—Development


Why are some countries more developed than others? Who is responsible for changing the current situation? (20 points) (2 pages)

Why are some countries more developed than others?

The stark divide between countries that are poor and rich has led to the attention on development. The United Nations Development program rates developments of every nation annually. Based on their results, some nations are richer in comparison to others. There are four theories that explain why some countries are richer than others. These include culture, lack of freedom, geography, and property rights. According to Landes David, an economic historian from Harvard University, differing rates of development are driven by culture. Landes argues that temperate regions such as Europe that experience cooler conditions are more suitable when it comes to productive activities such as cattle raising and growing of food. However, tropical regions such as sub-Saharan Africa were certain to develop slowly due to too hot climate. However, Landes argues that cultural factors such as religion have influenced the rate of development. For instance, in the 1500s, Protestants promoted concern and literacy of time conservation, something that is associated with higher productivity. Buddhist also stressed on labor and thrift leading to a more rapid social and economic development.

According to Bernard Lewis, lack of economic, intellectual, cultural, and religious freedom has led to social and economic challenges, especially in the Muslim world. Lewis continues to argue in his book that Muslim governments focus on looking for scapegoats for the failures instead of looking for when was done wrong. A report by UNDP on Arab Human Development that was issued in 2002 Arab nations has limited freedom associated with social and economic troubles. Other regions such as Africa, Latin America, South and East Asia, and Eastern Europe also experience limited freedom leading to slow development. Jared Diamond, physiologists, argues that the flow of natural resources in a geographic area has a great effect on how countries develop. For instance, the West developed first because the Eurasian landmass was oriented east-west with most of its parts lying in the same climatic region. This led to the spread of cereal cultivation, which Diamond refers to as agricultural success that led to greater development. Finally, according to Hernando de Soto, the structure of private property rights plays a major role in development. Holding great wealth in ‘dead capital’ makes countries poor. Land tenure and land ownership registration systems, determine whether a country will be rich or poor. Countries that have reformed registration systems when it comes to land tenure and land ownership are richer compared to those with traditional systems.

Who is responsible for changing the current situation?

Various development institutions are responsible for changing the current institutions. First development banks such as World Bank aim at fostering development through grants, credits with free interests, and loans at low-interest. Other development banks such as the Asian Development Bank also provides low-interest financing towards development projects. Second, the United Nations Development Program concentrates on promoting development by emphasizing on democratic governance, reduction of poverty, prevention, and recovery of crisis, promoting communication, and preventing HIV/AIDS spread.

Third, national governments especially from the wealthy countries through development agencies and departments help to promote development. Through such aids, the governments make grants to regional development banks, build various infrastructures in developing nations, and give advice on public policy to the developing nations. Fourth, non-governmental organizations also have a role to play in changing the current situation. They can do so by offering technical and financial assistance to nations that are developing. Some NGOs such as CARE, Oxfam International, and World Vision have the lead as examples in promoting development in developing nations.