Annual Editions: Developing World 07/08

This SEVENTEENTH EDITION of ANNUAL EDITIONS: DEVELOPING WORLD provides convenient, inexpensive access to current articles selected from the best of the public press. Organizational features include: an annotated listing of selected World Wide Web sites; an annotated table of contents; a topic guide; a general introduction; brief overviews for each section; a topical index; and an instructor’s resource guide with testing materials. USING ANNUAL EDITIONS IN THE CLASSROOM is offered as a practical guide for instructors. ANNUAL EDITIONS titles are supported by our student website, www.mhcls.com/online.

UNIT 1. Understanding the Developing World

1. 42940 How to Help Poor Countries, Nancy Birdsall, Dani Rodrik, and Arvind Subramanian, Foreign Affairs, July/August 2005

Efforts to help poor countries often ignore the reality that development is largely determined by poor countries themselves and wealthy countries can have only a limited impact. That impact can be enhanced by not only increasing aid and removing trade barriers but also giving poor countries more control over economic policy, helping to finance technology to promote development, and opening labor markets.

2. 41983 Can Extreme Poverty Be Eliminated?, Jeffery D. Sachs, Scientific American, September 2005

The world’s poorest 1.5 billion people continue to struggle to gain access to adequate nutrition, housing, health care, and sanitation. Economist Jeffrey Sachs argues that extreme poverty can be eliminated if the international community adheres to the Millennium Development Goals. Better insight into the causes of poverty—along with increased aid geared to specific targets and monitored for success—can alleviate poverty.

3. 42941 Today's Golden Age of Poverty Reduction, Surjit S. Bhalla, The International Economy, Spring 2006

Contrary to prevailing views, Surjit Bhalla argues that an emphasis on economic growth has resulted not in growing inequality but rather in unprecedented poverty reduction. Market emphases have been behind this success but Bhalla claims that political correctness coupled with efforts to protect the interests of international financial institutions prevent the recognition of this trend.

4. 42942 The Utopian Nightmare, William Easterly, Foreign Policy, September/October 2005

Utopian dreams of eradicating poverty must recognize the importance of determining the best approach to the problems of the global poor and improving the effectiveness of aid. The establishment of the Millennium Development Goals does not necessarily translate into providing needed medicines or mosquito nets to the world’s poor. Such top-down development strategies do not insure progress at the bottom.

5. 36086 Development as Poison: Rethinking the Western Model of Modernity, Stephen A. Marglin, Harvard International Review, Spring 2003

The West’s conception of development emphasizes markets and assumes that following its lead will result in development. In reality, Western culture undermines indigenous culture, especially that of community. The West should realize that the values underlying its culture are not necessarily universal.

UNIT 2. Political Economy and the Developing World

6. 42943 Climbing Back, The Economist, January 21, 2006

Developing countries substantially increased their share of the global economy as measured by Purchasing Power Parity (PPP) . Measured this way, developing countries now account for just over half of the global output. In addition, their share of exports has increased to 42 percent, they have half of the world’s foreign exchange, and they consume 47 percent of the world’s oil. At the same time, their stock markets account for only 14 percent of global capitalization.

7. 42944 Social Justice and Global Trade, Joseph Stiglitz, Far Eastern Economic Review, March 2006

Nobel Prize-winning economist Joseph Stiglitz argues that there is something wrong with the global trading system. The industrialized world’s tariffs on developing countries’ products are four times that of the developing world’s levies on rich countries’ products. Poor countries are pressured to open their markets and eliminate subsidies while barriers to rich countries’ markets remain and they continue to subsidize agriculture.

8. 42945 Hard Truths, The Economist, December 24, 2005

The December 2005 ministerial meeting of the WTO ended with little progress toward lowering trade barriers. The major achievements were a target date of 2013 for the elimination of agricultural subsides along with promises by rich countries to open their markets to poor countries’ exports. The conclusion of a comprehensive trade agreement remains elusive and will require concessions from both industrialized and developing countries.

9. 42946 The Protection Racket, Arvind Panagariya, Foreign Policy, September/October 2005

The controversy over agricultural subsidies in the Doha Round of world trade talks focuses on the need for industrialized countries to remove barriers to poor countries’ exports. Poor countries should pursue trade liberalization regardless of what rich countries do. High trade barriers in developing countries hinder exports, reduce the influx of technology, and stifle entrepreneurship.

10. 42947 Cotton: The Huge Moral Issue, Kate Eshelby, New African, January 2006

Cotton production in poor countries is threatened by subsidies paid to farmers in industrialized countries. Cotton subsidies in the United States exceed the GDP of Burkina Faso, a poor cotton producer. Because of these subsidies, overproduction results in lower prices for poor farmers. Although WTO rules prohibit subsidies that distort trade, rich countries have yet to eliminate them.

11. 42949 The $25 Billion Question, The Economist, July 2, 2005

After a decline in the 1990s, aid is making a comeback. Aid to Africa is set to increase, prompting questions about how to make this aid more effective. There are also concerns that large infusions of aid will adversely affect recipient countries. With innovative thinking, however, the obstacles to effective use of aid can be overcome.

12. 42950 Making Aid Work, Peter S. Heller, Finance & Development, September 2005

Recent efforts to deal with persistent poverty and increase aid flows to poor countries require that both donors and recipients cooperate to achieve this goal. Donors must increase the predictability and duration of aid while recipients must strengthen their macroeconomic policies, capacity to absorb aid, and budgetary management.

13. 42951 Aiding Development: Tracking the Flows, Finance & Development, September 2005

Increases in aid, which countries receive the most aid, who provides the most, the sectors of the economy that receive the most aid and the relationship between aid and growth are depicted in this examination of official development assistance.

14. 42952 Aid and Growth, Steven Radelet, Michael Clemens, and Rikhil Bhavnani, Finance & Development, September 2005

There has been considerable debate regarding whether aid contributes to economic growth. This study concludes that while aid directed toward achieving economic growth is effective, it works best in countries that have implemented institutional reforms and have improved their ability to absorb the aid. The study also found that early impact aid produced the most benefit and that effectiveness tends to diminish over time.

15. 42953 Food Sovereignty: Ending World Hunger in Our Time, Frederic Mousseau and Anuradha Mittal, The Humanist, March/April 2006

International food aid could be distributed more efficiently if the food was obtained in the region. U.S. food aid is produced domestically and at least 75 percent of it must be shipped on U.S. carriers. While this benefits U.S. producers and shippers, it raises the cost of food aid substantially. Food purchased in the region not only costs less but helps stimulate agricultural production.

16. 42954 Crisis of Credibility, Walden Bello and Shalmali Guttal, Multinational Monitor, July/August 2005

Beginning in the late 1990s the IMF has seen a steady decline in its influence on the global financial system. The 1997 Asian financial crisis and its aftermath called into question the Fund’s policy prescriptions and prompted a reappraisal of its role in developing countries. Evidence has indicated that with a few exceptions countries that followed structural adjustment policies did not achieve high rates of growth.

17. 40898 A Regime Changes, The Economist, June 4, 2005

The selection of Paul Wolfowitz as the new head of the World Bank was controversial. His knowledge of finance and development is limited and he is closely associated with the push for regime change in Iraq. His views will have an impact at the Bank as it becomes more deeply involved in promoting good governance, increasing capacity building, and other political issues.

18. 37881 Without Consent: Global Capital Mobility and Democracy, Jeff Faux, Dissent, Winter 2004

Writing the rules to govern the global trading system pits the interests of the world’s elite against those of the poor. Neoliberalism, advocated by the wealthy...