Comments

Hi Rosita, thanks for you very interesting piece. Although not in the development field myself (anthropologist by trade), the issue of unequal development is often the topic of conversation in the area of the world I work in - South Korea and Japan. In South Korea, in particular, it is possible to see extremes of both wealth and poverty within a few subway stops of each other. This is perhaps exemplified best with the case of the now globally known Gangnam area, and the nearby, not so well known Sillimdong, an area that has for a long time now somehow missed much of the development enjoyed by other parts of Seoul. South Korea and Japan are also interesting cases because of the influence of family-owned conglomerates that wield such huge financial and political power in these countries. The likes of Samsung and Toshiba are frequently pointed to as the reason for both the success and hardships of these East Asian economies. In short, great article, I look forward to reading more from you. Markus

Hi Michael, That's a good point. And I remember Kuznet's curves from development economics classes. But, as an empirical question, is there much evidence to suggest that today's crop of developing countries can expect to ride such curves? I imagine it would have been easy to argue Kuznets was right sometime around 1970, when looking at OECD data, but since then inequality has resumed its rise, suggesting that trajectories of inequality are more complex than might be suggested in initial theorising. cheers Terence

Thanks Michael. I think as you suggest that the empirical evidence does not support the "a rising tide lifts all boats" theory. Economies have clearly grown rapidly over the past forty years, but so too has inequality. Your point on the US is a good one. One has only to spend some time in the States to witness the extremity of the poverty many Americans experience. It is not a model for emulation if we believe that the objective of development is about more than AGGREGATE growth.

Ashlee, you are quite right. Timor Leste should have been listed as a lower-middle income country. I think it is not only donors that will need to shift the way they engage in the region, but the broader set of development organisations, including NGOs, universities, and development contractors. Joel Negin's article makes important points, and I particularly agree with his recommendation that donors should be looking to focus on facilitating an open sharing of ideas across the region. But I would also be cautious about framing the future of Australian development assistance as being primarily a technical process of transferring Australian knowledge. Evaluations of development assistance over the past twenty years provide fairly compelling evidence that a focus on technical approaches without actively formulating programs around a deep understanding of the political economy of the region or community, leads to weak outcomes as efforts at reform often encounter serious roadblocks. I would also be wary of recommending that Australia work on justifying the value of Australian knowledge over that provided by other Western donors, or indeed that available within Asia. Middle income Asia has a huge amount of resources at its disposal in terms of highly educated populations and skilled workforces. My experience (in Asia, rather than the Pacific) has been that facilitating knowledge sharing between Asian countries is often more welcome and better received than offers of Western technical assistance. But as my article stated, I am advocating that as an industry we start looking for other ways to support development in middle income Asia. Serving a convening role between important political and technical actors, and facilitating collaborative relationships between various power holders and interest groups is a good place to start.

Hi Rosita, Interesting post. I was wondering though, what measure for lower-middle and upper-middle income are you using? I was just surprised to see Timor-Leste listed as upper-middle income alongside countries such as Thailand and Malaysia -- the World Bank classifies it as lower-middle income and the government there has a goal under its national development plan to move to upper-middle income status. I know the high resources revenue has the potential to skew things in Timor and I think the World Bank accounts for that in its measurements. Aside from that comment, I agree with you that this change in Asia will also necessitate a shift in how donors, including Australia, engage and view their role in the region. I think Joel Negin's recent <a href="https://devpolicy.org/the-future-of-aid-not-all-about-the-money-20130411/" rel="nofollow">post</a> on the future of aid not being all about the money is really relevant in the case of growing Asia -- if donors want to stay in the game they need to make sure they have the competitive knowledge and technical expertise.

Hi Rosita, Thanks for the article. Without meaning to detract from any of the points you make, I wonder to what extent income inequality is a temporary byproduct of the process of development, that may actually fix itself over time? Your comments about China, India and Indonesia reminded me of an idea in development economics that is embodied by the Kuznets curve. This idea postulates that, as a country develops, the rich get richer earlier than the poor get richer, which results in a rise then fall in inequality over time. I'm not aware of how well this is supported by empirical evidence though. In any case, this is not to say that nothing need be done - high levels of inequality in developed countries is by no means impossible (e.g. USA's and China's Gini co-efficients are roughly the same). Michael

Thank you Susana, It's good to hear of the progress towards meeting the MDGs and hopefully with time we will be clearer as to the processes involved. Terence

Stephanie, thanks for your reply. I understand the importance of measuring. In this case, no one else was doing what the MVP was doing. No similar project existed and the MVP brought in additional funders (private enterprise, new partnerships etc) that did not exist before. The bigger question is "how do we know what we know?" Measuring is important, but it is only ONE of the tools in epistemology. Other ways to know whether things work include: historical knowledge, practicing knowledge (which should be further developed in methods), experience, working with local communities and local leaders, etc. I agree that all of these other "ways of knowing" should be as rigorously applied as formal measurement methods, but they are just as valuable ways of determining what works.

Terence, thanks for your response. I would just add that many, if not all, of the MVPs are on track to meet the Millennium Development Goals (MDGs), which is not necessarily the case outside of the MVPs for the country as a whole, although many have made progress on the MDGs. Susana

Thank you Stephanie, Your point about counterfactuals is well taken and very well put. Terence

Susana, the comments you make here and elsewhere actually do not speak to the issue here. We have limited funds to alleviate poverty - how do we use them best? Sure the MVP has done great work. But if I had flown over the village and thrown the equivalent amount of money out of the window, would it have done as much good, if not more? Aid interventions are expensive, often involve lots of expensive foreign experts, and often don't fix the problem over the longer term. Unless we measure carefully, and know our impact is what is making a difference, not the overall economy or other factors, our scaled-up interventions may not work at all and simply be wastes of money that could have made a bigger impact if used in other ways. Remember, ever dollar spent on the MVP is a dollar not spent on e.g. immunization, de-worming, maternal health, education etc. somewhere else - somewhere it may have done even more good, somewhere we have the evidence to know it WOULD have made a difference. Unless we measure, we won't know - and we won't be solving the challenge of poverty.

I don't want to appear an apologist for RAMSI but please provide evidence of their promotion of excessive logging. I agree that the SI economy will have trouble once logging stops and I agree that export of sawn timber would likely have been a better option but I fail to see where RAMSI fits in here. When you say "the advice was not acceptable to those MPs who were raking in the timber money from their personal involvement so the officers were sent packing.", are you suggesting RAMSI should have somehow stopped this from happening. I suggest that had RAMSI publically attempted to do that they would have set themselves up as an easy target for " those MPs who were raking in the timber money" who would then severely criticise them for neo-colonial interference in SI domestic affairs, i.e. a no win situation.