Nobel laureate economist Angus Deaton concepts for poverty reduction

Income and health care are the parameters that make inequality measurable for the Nobel laureate Angus Deaton. This applies to the international as well as the domestic comparison, he writes in his book “The Great Outbreak”. In order to reduce the gap between the rich and the poor, typical poverty diseases should be combated.

Nobel laureate economist Angus Deaton concepts for poverty reduction
Deaton assumes that the key reason for the rising well-being is not more income but more knowledge. (Imago / SKATA)

The second half of the 18th century was a time of many innovations: resourceful heads developed not only loom and steam engine, but also the first vaccination procedures. At that time, what Angus Deaton called the “big outburst” began: industrialization led to higher incomes, the increasing middle class demanded better living conditions. And these rose to a historically unrivaled level – at least for a part of the world’s population. At the same time, however, this enormous progress has brought with it a new phenomenon, writes Deaton. The global inequality:

“Inequality is often a result of progress, not everyone gets rich at the same time, and not everyone gets immediate access to the latest life – saving measures … […] inequalities have their effect on progress either in the good sense when Indian children see what One can achieve through education […] or in the bad sense if the winners try to prevent others from following them […]. ”

Medical care is part of prosperity

Deaton, who received the Nobel Prize in 2015 for his research on poverty and prosperity, wants to highlight this interaction between progress and inequality in his book. Why are some countries catching up, others not? Is the inequality in the course of time increasing, or is the development reversed? In his analysis the author not only considers the development of income. It also involves medical care as a further measure of prosperity. Because:

“If one takes health and income together, it is clear that the gap is even greater and the well-being is even wider than it seems to you when you look only at health or income.”

Deaton’s book is subject to a clear threefold: In the first part, he devotes himself to health care, in the second part of the development of income. In the third part of the book he asks the question, how already developed countries can also help the poorer states to the “big outbreak”. Its central knowledge about prosperity in the world:

“This is perhaps the most important finding about the well-being in the world since the Second World War: It is increasing, both the health and income aspects of well-being have improved over time Diseases and material deprivation. ”

Child mortality is a question of progress

This is especially true of the fact that particularly populous countries like China and India have developed positively. In addition, fewer children worldwide die.

Deaton assumes that the key reason for the rising well-being is not more income, but more knowledge. He points out that the decisive progress in the fight against global child mortality was not achieved primarily through better food. Relevant was the realization that poor sanitary conditions spread germs, which in turn trigger diseases:

“Scientific progress – and germination is a remarkable example of this – is one of the key forces that have led to the improvement of human well – being, but as the reluctance of germination theory shows, new discoveries and new technologies are not accepted without widespread acceptance Social change. ”

This means that countries can remain behind without governments providing the necessary infrastructure and a well-educated population demanding their rights. For this reason, the global differences in medical care are still huge in many respects.

The state plays a central role in inequality

In the distribution of income it is also not possible to establish that the inequality decreases. As Deaton points out, this is true within industrialized countries, because technological progress benefits mainly well-educated workers. There are also many countries where, unlike China or India, there are no signs of catching up:

“The reason why this has not happened is one of the most important questions of the economy. Perhaps the most conclusive answer is that poor countries lack the institutions that are the precondition for growth: state administration, functioning legal and tax systems, protection of property and trust. ”

Once again, the author emphasizes the central role of the state. He also criticizes the fact that global aid has only aggravated the situation in poor countries and has not improved. The idea that poverty in the world can be combated by transferring money to poorer countries is described as an aid illusion:

“If poverty and underdevelopment are primarily the consequences of non-functioning institutions, large financial contributions from outside will exactly the opposite of what is intended by further weakening the institutions or hindering their development Positive direct effect of development aid as a whole. ”

Typical poverty diseases must be researched and combated

A much more effective response to global poverty would be for Deaton less trade barriers to products from developing countries, more consistent sanctions against oppressive regimes, and greater research on “poverty”, such as tuberculosis or malaria.

In his book, Angus Deaton shows how difficult it is to capture global inequality at all. Data on poverty and wealth, if at all available in sufficient form, are often ambiguous and politically charged. Nevertheless, with a mixture of many statistics and illustrative examples, the author succeeds in establishing a well-founded inventory of the world’s states. His analysis shows clearly that even if many people have made the “big outbreak” – until this step succeeds all humans, it is still a very long way. Deaton himself is cautiously optimistic:

“The longing for an outbreak from the prison of poverty can hardly be suppressed: the escapees are cumulative: the future outbreaks can climb on the shoulders of giants, the previous outbreaks can pour the escape tunnels, but the knowledge about how the Have been dug, they can not withhold them from them. ”

Above all, he makes it clear that if we – the Western states – really want to fight poverty in the world, we should be more honest with ourselves. Whether development aid is the right path, can be arguably disputed. However, the measures that Deaton proposes instead would be a great relief for poorer states. The question remains: Why are they not implemented?

 

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