Poverty, Development, and International Aid

Definitions of Development

Defining development is complex as the concept takes on different meanings for various thinkers and theorists. At its core, development refers to positive change or the process of improving people’s lives. However, perspectives differ on how development should be defined, measured, and achieved.

For some, development is primarily about economic growth and increasing GDP per capita. For others, human development factors like health, education, political freedom, and environmental sustainability are central. Development can also be understood as modernization, whereby traditional social structures are reorganized to increase productivity.

Some approaches critique dominant economic models, instead prioritizing redistributive justice and meeting basic human needs. There are also many theories examining the historical, political, and sociological drivers behind underdevelopment, like colonialism. How development is defined has implications for policy, as different definitions point to alternative goals and strategies for promoting societal advancement.

Ultimately, there is no single authoritative meaning of development. It is a complex concept intertwined with evolving philosophical, economic, and political thought. This multifaceted nature of development must be appreciated when analyzing theories and approaches.

Poverty and Underdevelopment

Very often discussions of development begin by focusing on the characteristics and descriptors of underdevelopment. For example, underdevelopment is usually characterized by low per capita incomes, low literacy rates and educational levels, lack of access to basic services like clean water, sanitation, electricity etc.

However, simply describing underdevelopment does not explain its underlying causes. Underdevelopment needs to be understood in terms of the processes and structures that perpetuate it. Merely describing that underdevelopment is characterized by poverty, low human development, lack of infrastructure etc. does not provide an understanding of how underdevelopment comes into existence and persists over time.

To gain meaningful insights into underdevelopment, we need to go beyond descriptions and examine the historical, political, economic and social dynamics that create and sustain it. Some key questions include - what are the national and international power structures that allow underdevelopment to continue? How do colonial and imperialist policies impact countries of the Global South? What are the gender, race and caste dimensions of underdevelopment?

Descriptions of underdevelopment provide a snapshot but do not capture the nuances of how underdevelopment is actively produced through complex global and national systems. Examining underdevelopment through multiple theoretical lenses allows us to gain a more meaningful understanding of the issue in all its complexity. This involves analyzing the economic, political and social spheres not in isolation but in relation to each other. The descriptors of underdevelopment then become symbols of deeper inequalities that need to be unearthed and challenged. Only then can effective policies for promoting sustainable and equitable development be envisioned.

Some Common ‘Theories” on Underdevelopment

Some common explanations given for underdevelopment in poor nations include environmental or cultural determinism, political instability and unrest, and poor physical environments.

Environmental or cultural determinism refers to the view that underdevelopment is caused by certain physical environments or cultural traditions and value systems. For example, some argue that a lack of natural resources or cultural values that do not emphasize profit-seeking or entrepreneurship lead to underdevelopment. However, there are many examples of countries like Japan that have succeeded economically despite a lack of natural resources, demonstrating that underdevelopment is not solely determined by environment or culture.

Political instability and extended periods of internal turbulence are also sometimes cited as barriers to development. When countries are plagued by issues like tribal rivalries, ethnic tensions, authoritarian regimes, and civil unrest, it becomes very difficult to focus resources on development goals. The numerous civil wars and unrest in many central African nations have clearly impeded economic and social progress in those countries.

Lastly, a difficult physical environment like lack of rainfall, poor soil quality, and an absence of easily accessible natural resources can pose challenges for development. However, with appropriate technologies and policy solutions, as well as targeted foreign aid, these issues can potentially be addressed and should not condemn a nation to indefinite poverty.

Overall, while environmental, cultural, political and geographical factors may contribute to underdevelopment in some nations, they do not provide a complete explanation. Underdevelopment arises from a complex interplay of historical, political, economic and social forces both within countries and globally. Blaming any one factor in isolation oversimplifies a complicated issue.

Other Common Explanations of Underdevelopment

Vicious Circles - Gunnar Myrdal

Gunnar Myrdal theorized that underdevelopment is caused by complex webs of interlocking vicious circles, where each circle is a chain of cause and effect relationships leading to a downward spiral. Myrdal argued that high birth rates lead to large families, which in turn leads to low per capita income and widespread poverty. This poverty then leads to low worker productivity and poor health due to inadequate housing, nutrition, and health care.

Myrdal saw these vicious circles as an inescapable trap - the downward spiral is not easily reversed without massive outside aid. Possible vicious circles he outlined include:

• High Birth Rate > Large Families > Low Per Capita Income > Poverty > Low Output Per Worker > Low Productivity
• Low Per Capita Income > Low Savings > Low Investment > Low Productivity
• Low Per Capita Income > Poor Health > Inadequate Housing > High Infant Mortality

The remedy, according to Myrdal, is for advanced industrialized countries to provide sufficient aid to help break the vicious cycle. This aid can provide capital, technology transfers, and expertise to boost productivity and living standards.

Another Common Explanation

The vicious circle theorists fail to explain how the unfavorable circumstances leading to underdevelopment initially came about in the first place. To really understand underdevelopment, we need to examine the historical roots and view development as a dynamic sequence of events over time.

Many point to colonialism as a major cause of the disintegration and decline seen in underdeveloped nations today. Colonial powers disrupted traditional economies and social organization through the imposition of plantation agriculture and mineral extraction that mainly benefited the colonizing country. Infrastructure development during colonialism focused on linking resources and cash crops back to the colonizer’s economy, with little benefit for the colony itself. The introduction of Western legal codes and bureaucracy undermined traditional leadership and authority structures. Divide and rule governance tactics sowed ethnic divisions.

Overall, colonialism oriented economies externally in a way that failed to create internal development or economic diversification. It often left new nations at independence with weak institutions, low human capital, and social fragmentation. The lasting economic, political, and social legacy of colonialism is seen by many as laying the groundwork for continued underdevelopment.

Theories of Development

Meaning of Development – Todaro

Todaro defines development as not purely an economic phenomenon but rather a multi-dimensional process involving reorganization and reorientation of the entire economic and social system. Development is a process of improving the quality of all human lives with three equally important aspects:

• Raising peoples’ living levels, including incomes, consumption, food, medical services, and education through relevant growth processes.
• Creating conditions conducive to growing peoples’ self-esteem by establishing social, political and economic systems and institutions which promote human dignity and respect.
• Increasing peoples’ freedom of choice by enlarging the range of available options, such as varieties of goods and services.

Alternative Interpretations of Development

There are several alternative interpretations of development:

• Development as Economic Growth - This view often emphasizes commodity output rather than people, using measures like GDP growth. A problem is the persistence of a dual economy with a small export sector employing advanced technology, while most people work in a traditional sector with inefficient technology.
• Development as Modernization - Focuses on the social changes needed to spur economic advancement, including developing profit and wealth oriented values rather than subsistence and self-sufficiency. This leads to investing in education and skills training.
• Development as Distributive Justice - Views development as improving basic needs and social justice. It raises issues like public goods provision, access across classes, burden sharing, and targeting disadvantaged groups.
• Marxist View of Development - Focuses on modes of production and resulting class conflicts in capitalist societies, where workers’ surplus labor is exploited by employers.
• Neocolonial Dependence Model - Sees underdevelopment stemming from historical exploitation within the capitalist system’s center-periphery relationship. Attempts at self-reliance are suppressed. Local elites maintain inequality and conformity to benefit.

International Aid

International aid refers to economic assistance in the form of loans and grants provided by a donor country (or agency) to a recipient country. Aid serves a variety of purposes relating to economic development and welfare.

Forms of Aid

There are two main forms of international aid:

• Bilateral aid - Aid given directly from one country to another. This makes up the bulk of aid and allows donors to target specific countries and development projects.
• Multilateral aid - Aid channeled through international organizations like the World Bank, UN agencies, and regional development banks. This type of aid aims to be more neutral and poverty-focused.

Donor Objectives

Some of the main objectives and motivations behind international aid include:

• Security - Using aid to build alliances and prevent conflict
• Poverty reduction - Helping alleviate poverty in developing nations
• Democratization - Encouraging democracy and “good governance”
• Environmental protection - Tackling issues like climate change
• Private sector growth - Promoting trade, investment, and free markets
• Human rights - Supporting basic freedoms and justice
• Women’s empowerment - Improving outcomes for women and girls

Criticisms of Aid

International aid has been subject to various criticisms, including:

• Conditionality - Aid being tied to donor demands
• Neocolonialism - Aid seen as a form of control over developing nations
• Ineffectiveness - Questions over if aid actually helps reduce poverty
• Tied aid - Donors requiring funds be spent on goods and services from the donor nation
• Government corruption - Aid allegedly propping up corrupt regimes
• Lack of coordination - Too many donors and projects leads to inefficiency
• Market distortion - Aid discouraging private investment and entrepreneurship

Despite criticisms, international aid persists as a major tool for developed nations to engage with and support the developing world. But debate continues over if and how aid should be reformed to become more effective and responsive to true development needs.

Neoliberalism and Aid

Neoliberalism has had a significant influence on international aid programs and agendas since the 1970s. The basic tenets of neoliberalism emphasize deregulation, privatization, free markets and trade. When applied to aid and development assistance, neoliberal agendas have several notable characteristics:

Democratization - Aid is often conditional on the recipient country holding regulated elections. However, neoliberal agendas tend to only support a procedural form of democracy with highly-policed elections. They discourage other forms of more substantive political participation and conflict that could disrupt business interests, even if it represents the collective will of marginalized groups.

Poverty alleviation - Aid ostensibly aims to help the poor. But neoliberal approaches often focus only on helping a quantitative number of individuals in poverty, without allowing their collective organization to challenge structural inequality.

Developing the economy - Aid aims to reform economies in line with neoliberal principles - reduced state spending on welfare, deregulation, privatization, and creation of markets. Neoliberal aid often pressures states to suppress workers’ rights and protests that disrupt the free market.

Human rights - Neoliberal aid regimes promote human rights through bureaucratic accountability mechanisms for individuals to file complaints. But they discourage forms of collective dissent and protest that could disturb the status quo.

Peace-building - Neoliberal aid emphasizes continued stability and order for markets to function. Social disruptions from marginalized groups demanding rights are suppressed in the name of peace-building.

In essence, neoliberal aid agendas emphasize individualistic remedies to poverty and inequality rather than empowering collective action. They aim to maintain an orderly free market system rather than addressing deeper structural causes in the global economic system.