Post pandemic, which issues need to be added and reincorporated into the development economics curriculum? Kevin Deane asks.
There is a strong argument that Covid is not an external shock but an inevitable and predicted outcome of expanded and increasingly intensive economic activity. The current pandemic and the public-health related responses implemented across the globe are intimately intertwined with economic considerations, especially with respect to the impact of lockdown and other control measures that hinder economic activity. The economics of the response to this health crisis in the Global South enables some critical reflections on mainstream development economics teaching.
Indeed, crises often open up a space for a critical reflection on mainstream economic theory and the discussion of alternative schools of thought and ways of thinking. The financial crisis of 2008, for example led to open questioning of the economics, discipline, with student and academic movements calling for more pluralistic economics teaching in higher education in the UK and beyond.
As with other sub-disciplines, mainstream economic theory has colonised the development economics curriculum. Many (but not all) UK economics departments teach development economics in a primarily mainstream way by applying core neoclassical theory and data techniques to the subject of development.
“Mainstream economic theory has colonised the development economics curriculum.”
More recently, top-ranked universities in the US have embraced the behavioural and experimental economics of Duflo and Banerjee, representing a significant but limited shift in the discipline. In a recent World Bank report which presented findings from a survey conducted with a range of economics departments in the US and across the globe on their development economics curricula and teaching, the top-20 US economics departments reported using Duflo and Banerjee’s Poor Economics as the preferred textbook. This is in contrast to resources that are traditionally used that present a more holistic overview of the field and which also engage with historical processes. This change in emphasis is also increasingly reflected in development economics courses and modules in the UK. Development economics programmes (and sometimes entire modules) have seamlessly incorporated randomised control trials with econometric and quantitative methods.
The World Bank report goes as far as concluding that development economics curricula in developing countries however have “not kept pace with this change, and are not meeting key student learning goals of teaching students to be critical users and analyzers of data to answer economic questions”. This implies that the topics taught in developing countries are no longer at the cutting edge of the discipline and that this needs to change.
This behavioural turn in what the World Bank considers to be the world’s leading economics departments, as with neoclassical economics in the 2008 financial crisis, seems particularly poorly placed to address some of the core economic challenges posed by the Covid control measures, such as how African states should respond to minimise economic impacts and protect livelihoods.
Covid and the various control measures that have been implemented across sub-Saharan Africa and in the global north, such as lockdowns, curfews and the closing of borders to international travellers, have posed some significant economic challenges for sub-Saharan countries. These include concerns related to:
- The ability of the poorest households and those reliant on income from the informal sector to be able to abide by, and survive the demands of, lockdowns;
- Underfunded and weak health systems that are ill-prepared to cope with a surge in Covid cases; and
- Projected recessions due to the effect of slowing global demand, disruption to global supply chains, reductions in tourism and decreasing prices in key commodities.
The crisis has highlighted a renewed focus and interest in three key areas.
Firstly, the state is once again a key actor in relation to both the public health response and the economic response. Despite decades of structural adjustment and related programmes that have focused on scaling-back the role of the state, aid programmes and third-sector activities that sidestep the state apparatus, and widespread suspicion of the state linked to corruption, the state has a key role to play in the Covid response.
For example, the state is required to make complex public health decisions that involve the consideration of inevitable, predictable and unintended economic consequences of lockdown as well as the transmission dynamics in their context. States are also relied upon to implement economic support programmes for those impacted, and these have included targeted relief programmes for poor households, food distribution, provision of free electricity and water, increases in social protection programmes, as well as central bank interventions to support local commercial banks.
The crisis, then, has brought into focus the key role of the state, as it has in the global north, with the order of the day being enhanced state borrowing to fund state spending on impact mitigation (in the hope this will also mitigate the longer term effects).
“The state is once again a key actor in relation to both the public health response and the economic response.”
However, the state is almost entirely absent from mainstream development economics curricula, with the market, alongside behavioral nudging, preferred. The World Bank reports highlights that this is one theme that they consider superfluous to development economics and generally not taught in what they consider to be the top US academic institutions.
Secondly (and related) is the ongoing dependency of sub-Saharan African economies on the fortunes of the economies of the Global North. As with the financial crisis in 2008, where gross domestic production (GDP) per capita growth in sub-Saharan Africa fell from 3.6% in 2007 to 0.299% in 2009, the International Monetary Fund predicts that sub-Saharan African economies will contract by 3% in 2020. There are concerns that this will reverse recent gains and take GDP per capita back to its 2013 level. The effects will be worse for economies that are highly dependent on international tourism and commodity exports.
The fragility of sub-Saharan African economies to external shocks and changes in the economic circumstances of the Global North illustrates the increasing degree of integration and a dependent relationship that only holds in one direction. A second global economic crisis in little more than a decade has stimulated discussion about alternative models of development, as well as the extent to which sub-Saharan economies are able to re-frame their economic relationships with the global north.
Specific (and often necessary) local responses to Covid, such as the call to scale-up local food production, have put notions like self-sufficiency, long-viewed as blasphemy in the world of free trade and economic efficiency, back on the agenda. These discussions also inevitably involve a different role for the state.
“The fragility of sub-Saharan African economies to external shocks and changes in the economic circumstances of the Global North illustrates the increasing degree of integration and a dependent relationship that only holds in one direction.”
The topic of dependency is also not covered in most mainstream development economics curricula. As with the role of the state, this has been purged from the curriculum in US economics departments. The Black Lives Matter movement has highlighted the need to engage with structures of power – local and global – and histories of oppression. It is therefore unfortunate that the most powerful academic institutions in the world, with the implicit support of the World Bank, have removed any discussion of global power relations and colonialism (which dependency theory explicitly engages with) from their curricula. Contrary to this purge, it is essential that all students can locate the experiences of African economies and the continuing external dependence on, and patterns of trading relationships with, the global north in historical context.
Thirdly, is the role of the informal sector which is highlighted by Covid control measures. While the self-employed entrepreneur is frequently reified in the behavioural literature, the reality is that for most, engaging in informal sector activities is not a choice. It usually reflects the general lack of availability of, and access to, formal waged employment. For many households, restrictions on informal activities present significant challenges, with livelihoods fragile and insecure.
However, recent debates about the informal sector primarily relate to whether the informal sector should be formalised or not, and how economic opportunities in this sector can be expanded. The World Development Report of 2013 titled Jobs, drew on a very broad definition of a job as a vague and patronising notion of having things to do. It failed to focus on expanding the provision of, and access to, waged employment that could provide stable and secure incomes that can more easily be supported in times of crisis – as formal employees have been supported in the Global North. Furthermore, households are more likely and able to save if incomes are steady and certain, increasing resilience to crises.
“If fragile and uncertain livelihoods are to be improved, discussions about formal employment cannot be ignored.”
The focus on promoting entrepreneurialism above the expansion of waged employment is intimately linked with other economic topics, for example industrialisation, that are also no longer in vogue in the new behavioural world. If fragile and uncertain livelihoods are to be improved, discussions about formal employment cannot be ignored, and this needs to be reflected in the curriculum.
These are not the only economic issues highlighted by Covid; concerns around debt and health systems financing are also brought to the fore. However, they represent some of the key economic themes that have been purged from mainstream economics courses. These need reincorporating if students are to understand better, and engage with, economic and health crises in the sub-Saharan context, given that scientists predict that these kinds of health crises will become more frequent.
As mainstream economics teaching coalesces around a narrow set of tools, techniques and assumptions, more pluralism in development economics is urgently needed. This does not necessarily require a reinvention of the wheel. As with the financial crisis when many turned to the work of Keynes and Marx, development economics has a rich body of existing literature to revisit. That includes the work of economists from the Global South who are under-represented. This literature may provide alternative perspectives that can provide important insights for coping with the current crisis and building resilience to future ones. The development economics curriculum does need addressing, but not in the way the World Bank suggests – this would represent the ultimate colonisation of a curriculum that requires precisely the opposite.