why poor countries don't catch up

Discussion in 'Economics' started by morganist, Apr 8, 2010.

  1. this paper is interesting.

    http://www.voxeu.org/index.php?q=node/4839

    i thought the ideas are good but miss things. one thing i would question is why some countries have better abilities to reform financial systems. is this to do with corruption or other limitations.

    what do you think?
     
  2. Part of the problem is inefficiency. If any of you have ever gone to a bank in the 3rd world you know what i mean. 2 hour waits when there is only 1 person in front of you. I remember trying to cash a travelers check at the bank. They took my check and told me to go sit in the corner. An hour later they told me they couldnt cash all my checks because it was too much money (it was only like $1000 dollars) Then they told me they would cash $200 worth if I had 2 forms of ID and a credit card. This happened at the biggest national bank in that country.

    Slow customer service, nobody obeying the laws of the road (if there are any as sometimes it didnt seem like there was) and traffic jams everywhere, 10 hours to drive 170 miles...all this contributes to the slow down of the velocity of money and people can not prosper if the money isnt moving.
     
  3. a thousand dollars is five years wages for some of them. that is why.
     
  4. read confessions of an economic hitman and a century of war and it will be all to clear
     
  5. No, if money moved faster, they would make more. Its a little exaggerated that 1000 dollars is 5 years wages. 60% of the world live on a little less than $2 per day, so its really about 18 months wages or so. It might be true that there are some jobs that pay $200 per year, but those are generally jobs that people do not hold for very long. Also you forget the benefits of the people that make $200 per year. Almost always the employer will house and feed them if they pay that little. But poor countries could catch up if their business infrastructure was more efficient.
     
  6. Yeah thats a real eye opener isnt it?
     
  7. This, systemic corruption and wild currency debasement.

    However, some poor countries are catching up. By tearing the west down.

    Globalization is just a transfer of wealth (read: jobs) from the West to the East (and South America).
     
  8. Not that it's THE answer to all of the problems, but climate plays a huge and little known role in IQ development.
    Too cold, and all they worry about is survival.
    Too hot, and all they worry about is shade.
    Sounds a bit nutty, but some amazing studies have been done on this subject.
    Temperate climates produce a higher mean level of IQ, not to mention motivation to organize, which is how Western Europeans got up off their collective ass, founded the New World, invented the car, phone, Saturn V rockets, and computers.
     
  9. how come there isn't an equivalent in the southern hemisphere where the same temperate environment exists?

    what about the chinese, japanese, greeks, egyptian etc. civilisations weren't they all hot?

    conversely russia. that is cold but that has thrived in periods.
     
  10. China and Japan aren't "hot", Greece gave us the beginnings of Democracy, and Eygpt was great if you were in the ruling class, sorta like Communist Russia.
    All great civilizations rise and fall, and I don't have all the answers.
     
    #10     Apr 8, 2010