December 14, 2015

Foreign aid and development efforts often focus only on technical solutions to the problems of third-world poverty, but these tend to be implemented by technocratic regimes that don’t take into account the wishes of the poor they aim to help. In his 2015 Hayek Lecture at the Institute of Economic Affairs in London, development economist William Easterly explained that the most important factor in lifting people out of poverty is allowing free markets and entrepreneurship to flourish.

“I want to convince you that this is a cause that, indeed, economists should take seriously — and, indeed, everyone in the aid and development world should take seriously,” Easterly said in his address. “As development workers, we actually cannot do our work in some kind of value-free, politics-free environment. ... We cannot ignore such a simple principle as the rights of the poor to choose — to choose their own destiny; to possess their own property; to be able to protest if you violate that choice, that right to consent. And that’s why we cannot ignore politics in development work.”

Easterly explained that concern for the rights of the poor should be universal, a nonpartisan effort that treats people in poverty-stricken areas with the same dignity and respect that we would hope for ourselves. This is a particular problem in the development industry because the institutions that grant international aid often end up bolstering the regimes of oppressive dictatorships in places like Uganda because money is funneled directly through corrupt political systems.

“The problem of poverty is not a shortage of experts,” Easterly explained. “It’s a shortage of rights. And the reason for that is the other part of a very long literature in economics, in which rights are themselves a problem-solving mechanism that makes the technical solutions happen. It’s the ability of us as free citizens in our own societies, it's the ability of poor people in their societies, to hold the suppliers of their needs — both private and public — accountable that makes technical solutions happen. ... There's never any utopia on the horizon, but when there's an environment of universal rights for poor people, for citizens of a society, then that does indeed make technical solutions happen.”

Easterly, who is a professor of economics at New York University and co-director of the NYU Development Research Institute, published a widely praised book in 2014 titled The Tyranny of Experts: Economists, Dictators, and the Forgotten Rights of the Poor. The book, which explains why the fatal flaws underlying the technocratic illusion that poverty can be solved by development experts working in tandem with powerful governments.