Two op-ed pieces

To-day's Economic Times featured in its op-ed section Joseph Stiglitz, Nobel Prize Winner, and author of books such as Globalization and its discontents (here is the NYRB review), and Arun Maira.

First, an extract from Joseph Stiglitz's piece on how Wolfensohn realigned the World Bank's view of development during his ten years at its helm:

At one time, it was thought that merely supplying more capital would solve their [developing countries'] problems. In the 1980s, there was a switch from projects to policies — structural adjustments, involving trade liberalisation, privatisation, and macroeconomic stabilisation (typically focusing on prices rather than employment or output.)

But these policies proved neither necessary nor sufficient for growth; the countries of East Asia, which followed different policies, achieved faster growth and were far more successful in poverty reduction.

Under Wolfensohn’s leadership, the Bank began to look for multifaceted strategies, framed by what he called a comprehensive development framework. Many of the links were obvious, but had been given insufficient attention.

Improved rural productivity or better market access would do little good if roads and harbours were lacking. In a malaria-infested country, mosquito eradication programmes can boost production and even increase effective land usage, as acres that were almost uninhabitable become livable.

The returns from education, too, can be increased, if more individuals live longer because of better health care.

Arun Maira talks about the virtue of developing trust in business dealings. He uses two illustrations, both involving J.R.D. Tata and Sumant Moolgaokar, who was instrumental in nurturing TELCO (the present day Tata Motors) into an auto giant. Here is his concluding paragraph:

Therefore, the more we honour those who do the right thing even if it is not the law, and the less we admire the rich and successful who promote their own selfish interests, often living dangerously at the edge of law, the stronger will be the culture of trust in our business and society. Unfortunately we seem to be veering too far, even in India, towards a culture of self-interest and greed. Therefore, while we may complain about their costs and complexity, our corporate managers may have to be restrained by more onerous corporate laws. The alternative is to ‘take the law into our own hands and hearts’ and do the right thing always.