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I am a political science graduate and I have felt the same as Kristof for many years. But the reason that an economics degree would have helped me more that poli sci is not its subject matter but its methods. The economics students were forced to complete statistics and quatative methods classes. In contrast I graduated without ever having used a graph or chart or table in any of my essays or assignments. not one. I have managed to pickup a fair knowledge of economic theory through osmosis, but I am still woefully underqualified in the most effective tools for assessing complexity. The solution is rather simple: political science courses need to start teaching analytical tools and quantative methods. This will undercut the current monopoly that economists have on this method and inject some much needed rigour into political science.

"Supposing what is needed happens to be something we are no good at providing?" Then either give our money to a donor who can provide it and let them provide it or, if what's needed is something aid simply can't achieve, then do nothing (i.e. don't give aid to that country) or do something that is less acutely needed but which still helps. For example: in country X the central issue is governance, yet donors have little traction in improving this so, instead, they provide vaccines, which are still needed, even if they're not the fundamental development issue.

"we should choose based on what is needed and what is likely to actually work." Supposing what is needed happens to be something we are no good at providing? This is where the 'comparative advantage' argument seems to have some merit. Developed countries should be willing to sometimes admit that they can't do everything well, offer what they can do well, and let developing country people decide if they want to take up the offer, or go elsewhere if what is on offer doesn't fit with their needs.

Hi Sam, I's pretty sure I am explaining a shift away -- at least from the concept as it is used in Leigh's speech and in New Zealand aid documents. To re-cap -- I have suggested that choosing what type of aid to give to a country based on what we believe our own countries to be good at is not a good idea and that, rather, we should choose based on what is needed and what is likely to actually work. Context, not comparative advantage should drive aid. What you suggest -- letting countries themselves decide, already takes place to a degree through aid partnerships. But, issues of power imbalances remain, and - also, as you rightly note - the issue of representation (who ought actually speak for the poor of country X) is a major one.

Hi Terence, You don't seem to be proposing to move away from the concept of comparative advantage in aid, it's just (as usual) a matter of who has the power. If 'aid recipients' come to Australia for its expertise in mineral extraction, that's fine. If donor governments decide developing countries must have Australia's expertise in mineral extraction, or New Zealand's ovine veterinary skills, whether they want them or not, then that's a problem. The political difficulties lie in persuading donor countries to give up their power in the relationship (which is unlikely) and in finding representatives of 'aid recipients' who genuinely represent their interests. Cheers.

The thrust of this policy brief is how do we (donor community and development partners) support and strengthening partner country systems, in this case the public health supply chain system. How do we respond to the issue of sustainability, which I would argue is both financial and operational sustainability. PNG may be increasing its financial sustainability (i.e. increased govt exp to procure medicines) but, its operational sustainability is weak (i.e. cannot maintain order fill rate improvements, inventory mgmt, etc.). A question would be for donor funding and, specifically, in PNG how did AusAID prioritize their funding? That is did it aim to (1) ensuring access & availability of commodities or (2) strengthening the system to function more effectively. These objectives are necessarily the same thing or mutually reinforcing.

Hi Peter, Thank you for an excellent, albeit dispiriting comment. Unfortunately, I think your experiences will start to seem all too familiar to New Zealanders over the next few years. Witness the NZ Minister of Foreign Affairs'<a href="http://www.nzherald.co.nz/politics/news/article.cfm?c_id=280&objectid=10723482" rel="nofollow"> current tour of the New Zealand countryside</a> in search of farm based solutions to the problem of Afghanistan (in this instance completely bypassing his aid officials, apparently).

Andrew McNee is to be commended for his insightful Policy Brief. The procurement and distribution of medical supplies, medical equipment and other essential non-medical stores to and within PNG is one of the most complex and difficult supply chain tasks undertaken. The further strengthening of the PNG health supply chain will take time, resources, commitment and significant leadership. I look forward to learning of the success of this new intervention.

Terence Another thought-provoking post. The issues you raise are all too familiar to me as a former AusAID official. “Comparative advantage” was part of the defence used to justify Australia’s tied aid policy. Claims that aid tying led to inefficiency were countered by the argument that Australia always worked in areas where it had a comparative advantage. In my early days in AusAID and then still naïve about the political realities that distorted any efforts to improve the effectiveness of the aid program, I invoked my Economics training to suggest that this argument made no sense – if we were sure that we had a comparative advantage, we could untie the aid program in the sure knowledge that Australian firms would always win contracts. As Matt has already said, let the market show where comparative advantage lies. I was told to shut up - the claim sounded good and helped to avoid too much scrutiny of the case for aid untying. The issue of relevance of developed country experience was highlighted by Francis Fukuyama in his book “State Building”, in which he drew on the analysis by Pritchett and Woolcott. They described the process of assuming that developing countries could overcome their problems by becoming more like developed countries as “skipping straight to Weber”. AusAID was repeatedly being told this was the answer – for example, by Treasury, who wanted to send experts to sort out the budget and corruption issues in recipient countries by making their systems more like Australia. A particularly difficult example for me was the genesis of the Centre for Democratic Institutions. This concept emerged from Alexander Downer, who thought that Australia had a comparative advantage in strengthening political governance and should use that to help recipient countries strengthen their democracies by making them more like Australia. As ADG for Policy, I had the task of trying to sound like I was agreeing with the Minister while at the same time ensuring the CDI’s mandate allowed it more flexibility to provide support that reflected the social, cultural, historical and other factors that would make a Westminster-style political system irrelevant to most if not all partner countries. Finally, the issue of doing what we think we are good at rather than what is actually needed. For “what we think we are good at”, read “what we have plenty of and need to offload”. A case in point is the Nomad, the Australian aircraft developed in the early 70s to try to keep the Government-owned Aircraft Factory afloat. In lieu of genuine commercial orders, Nomads were offloaded on aid recipients whether they needed them or not. Their rusting remains probably still litter the airstrips of Pacific island countries. Then there was the suggestion perennially cropping up in Ministerial correspondence. How to provide aid and at the same time help the battling Aussie farmers? Easy! Give food aid, or (even more imaginatively), give large numbers of blankets, woven from Aussie wool, to all our poor friends. Just what is needed for Pacific Islanders to keep them warm on those long cold winter nights.

Thanks Matt. Mea Culpa on the definition. My only defence is that I'm a PolSci student 🙂

Terence, Thanks for sharing a thoughtful post on 'comparative advantage' in aid. I must admit that the use of the term is a pet hate of mine, but not for the reasons in your blog--it's because it gets used incorrectly. Having a comparative advantage is not the same as being the best at something. In fact, a country can be absurdly inefficient at doing something, but so long as it is relatively more efficient at doing that than something else, then it has comparative advantage. This is quite a tricky concept, and one which Samuelson described as one of the few in economics that is both surprising and true. (A much better explanation of comparative advantage can be found <a href="http://www.econlib.org/library/Topics/Details/comparativeadvantage.html)" rel="nofollow">here</a>.) Given that comparative advantage is about opportunity costs rather than 'best', identify specific examples is fraught with difficulties when we move from theory to practice. (I'd argue that planners should avoid trying to do this altogether). In Andrew's examples, it might be possible to assess whether Australia is good at mining and agriculture in aid, but virtually impossible to assess the opportunity cost of that focus. However while I think that identifying ex ante where a country's comparative advantage lies is problematic, you're conclusion 'find out what is needed, and what aid can realistically achieve, and then source the solution from wherever in the world it can be obtained reliably at the best price' is much closer how trade theory predicts that comparative advantage arises in practice. In this regard, I'd agree with Andrew that there does 'need' to be more attention on managing mineral booms, for example by considering the Natural Resource Charter. Conclusion: comparative advantage is important for aid, but if a country wants to find it, then let the market lead it there.

The question of who will be the next Prime Minister in PNG politics is critical for the people of PNG as we approach the 2012 general elections. The only person in parliament today that is capable of taking over the highest post is Sir Mekere Morauta. To be PM, it requires a lot to consider in a person. Ordinary politicians cannot be appointed to that highest post. I believe with Sir Mekere’s credentials, he can take over easily from Sir Michael Somare with much consideration of PNG’s economic growth achieved by the National Alliance Party led Government. Sir Mekere Morauta was PM previously, he was former Governer to Bank of PNG, he has a good track record in politics and he is more mature in a political sense. PNG has a good number of potential future PM’s being groomed today such as Don Polye, current Acting Prime Minister Sam Abal and Sir Puka Temu to name a few. However the time is just not yet right for these young leaders. With due consideration to Sir Julius Chan as being an alternative for the PM post, Sir Mekere Morauta should be the next PM to take over from the Grand Chief. Thankyou. Nigel