Book Review: The Bottom Billion by Paul Collier

That this was also the decade in which globalization came into full swing is more than a minor inconvenience for its advocates” (Rodrick). If globalization is supposed to present an advantage to developing countries, why have there been so many setbacks? Indeed, both sides will have its winners and losers regardless of which side of the development coin they live on, but for the most part globalization has lifted millions out of poverty, improved the standard of living, and increased life expectancy rates all while keeping developed nations relatively competitive to their developing counterparts. Globalization’s value is that it seeks to create an economic equilibrium in the world, where parties are free from barriers and can benefit from one another through a more efficient allocation of resources. This allows all participating nations to contribute to an integrated economy and where all nations willing to embrace globalization have the potential to benefit. Regardless, the path to successful integration to the global economy has not always been easy. There is contention towards globalization as some argue that it is detrimental to developed nations, while many developing countries that were forced to hastily open up their markets and integrate failed. However, if implemented properly, globalization has proven that it can benefit all parties involved and that the potential gains outweigh the losses.

Development and underdevelopment are linked and “condition each other mutually” resulting in a divided world that consists of industrial “central” countries and underdeveloped “peripheral” countries (Valenzuela and Valenzuela, 1978, p.544), with the periphery often being constrained by its role in the global capitalist system (Valenzuela and Valenzuela, 1978, p.544).

The film turns the spotlight towards the new rulers of the world, the great multinational and governments. Looking into the functionality of international institutions such as the IMF, World Bank, and more recent WTO the successor to GATT (general agreement on Tariffs and Trade). Under whose rules millions of people worldwide have suffered loosing their jobs and livelihood. The film demarcates the West having increased its stranglehold on poor countries misusing the power within these institutions. Pilger mentions, "just 200 giant corporations dominate a quarter of the world’s economic activity. General Motors is now bigger than Denmark. Ford is bigger than South Africa”. Showcasing how the extent to which these corporations exploit the developing nations. International institutions such as the IMF, World Banks were established post world war to help rebuild the economic infrastructure of European countries. However the principle policies these institutions are established upon are eroded and their new policies reflect the interests of the West especially

International development and underdevelopment are major issues in global society today. John Perkins’ book The New Confessions of an Economic Hit Man is a very critical account on the activities of private corporations such as MAIN and international financial institutions such as the World Bank and the International Monetary Fund and how many actions are based on self-interest, corruption and greed. The book does an exceptional job at giving us an insider’s perspective on why debt induced developing nations are in a constant state of underdevelopment from the corrupt actions of Economic Hit Men and their colleagues Jackals who deal with the dirty side of the business and political economics. Global economics and debt have

This week we discussed the novel The Bottom Billion by Paul Collier. This week however we talked about the four traps. From here I wanted to go more into depth about each of the traps and how to spring them to better understand what they mean and how they work.

Leaders and governments around the world have been trying to eliminate the issues regarding immigration/refugee, exploitation, distribution of wealth, global inequality and trade. Trade, especially, brings up the fact that inequality exists around the world. By using visual art, quotes from Thomas More “Utopia” and Fred Engel “The Condition Of The Working Class in England” as source document, this paper analysis summarizes some of the movements, changes, issues, and challenges that the world is grappling with as it continues to contribute to the globalizing world. It looks into the options, issues and paths the governments of the first and other neighbouring countries can take to improve the socio economy and also to avoid conflicts with those

The global wealth distribution continues to be defined by a massive inequality of wealth between advanced capitalist countries and the least developed countries. The gap between the thirty richest and the thirty poorest countries, in per capital income has grown from 17:1 in 1980 to 27:1 in 2002 . Despite massive aid and trade liberalisation programmes, development strategies in poor countries have not resulted in sustainable economic development but have instead resulted in ‘massive underdevelopment and impoverishment, untold exploitation and oppressions’ . Despite the success of some newly industrialising countries, most notably China, many of the world’s poorest countries continue to be reliant on the export of raw materials and agricultural

Today’s Global economy is governed by a delicate balance of variables. The addition of a new economy to the global market affects all of the pre-existing variables, bringing with it a host challenges and opportunities. Much like an initial public offering, countries may “buy -in” or develop economic agreements with the emerging market economy (EME). This often results in the country “buying-in” to the emerging economy, getting services or products at a discounted rate, while the emerging economy gets business like China and the United States. These types of agreement may result in the poorer country sacrificing its citizens’ well being, to ramp up for economic growth, like China. In the end most countries economies are interconnected for example with the United States-Canada relationship. If one country’s economy were to collapse there would be strongly adverse effects on the

“Two centuries ago the world’s economy stood at the present level of Bangladesh. Furthermore, the average … human consumed … a mere $3 a day, give or take a dollar or two.”1 This is how Dierdre McCloskey opens the second volume of her Bourgeois Trilogy. In it, she examines how we got from $3 a day to our current position, where “the world supports more than six-and-half times more souls. Yet … the average person nowadays earns and consumes almost ten times more goods and services than in 1800.”2 She calls this rapid acceleration of growth the Great Enrichment. A metaphor often used by McCloskey is that of a hockey stick. For the vast majority of history, humanity was moving along the handle of the stick. Then, suddenly, countries reached the blade and began experiencing hitherto incomprehensible growth. McCloskey spends three thick books trying to explain the causes of the Great Enrichment. However, the Great Enrichment itself can be studied in a more concise manner.

In an excerpt, Entering a new world, describes an outrageous number of people who makeup the entire population on Earth. In Entering a New World it states “Our global economy is outgrowing the capacity of the earth to support it, moving our early twenty-first century civilization ever closer to decline and possible collapse” demonstrating how

In today’s society the amount of technological and all around global advancements that have been made within a mere decade are astonishing, let alone what has yet to be constituted. Although not only the United States, but the entire world has globalized, it’s been proven that first world countries have an advantage in being able to heighten themselves quickly, opposed to third world countries that trail behind. Former U.S. Secretary of State, Henry Kissinger, stated, “What is called globalization is really just another name for the dominant role of the United States” (Prompt), proving that globalization sets a fine line between the perks of those fortunate enough in a capitalistic nation and those who are not.

Many historians and sociologists have identified a transformation in the economic processes of the world and society in recent times. There has been an extensive increase in developments in technology and the economy as a whole in the twentieth century. Globalization has been recognized as a new age in which the world has developed into what Giddens identifies to be a “single social system” (Anthony Giddens: 1993 ‘Sociology’ pg 528), due to the rise of interdependence of various countries on one another, therefore affecting practically everyone within society.

The Bottom Billion by Paul Collier discusses why the poorest countries are failing and then offers some insights and solutions to the problem. He says the four major problems in developing nations are: conflict, natural resources, bad neighbors, and bad governments. The conflicts are usually civil wars which have huge costs and the situation just becomes worse the longer the conflicts drag on. Collier states that countries rich in natural resources are often worse off than countries that are not, he attributes this problem to several different factors. One of the factors is that the resources open the possibility for conflict over the resources. Another factor is that if a country strictly focuses it’s on a specific natural resource then the other resources and industries might get forgotten and lose value. Being landlocked with bad neighbors can also be a large problem because it makes it almost impossible to be a part of world trade, so these landlocked countries have to depend on their neighbors for most of the trade and materials. A bad government can also be very destructive to a country’s economy, if they create unreasonable and restrictive policies. The smaller countries are also at a disadvantage because it is hard for them to get any investors, because the investors would much rather invest in well-known countries like India or China. After Collier stated all the problems he also offered up some possible solutions. He believed that aid agencies should concentrate

Harvard Business School’s Case Study “Aid, Debt Relief, and Trade: An agenda for fighting World Poverty” outlines the steps, and missteps, that the world community has taken since World War II to address the efficacy of international assistance. The study focuses on international financial institutions (IFIs) and their ability to help poor nations break out of poverty and the possible obligations of rich, developed countries to assist the heavily indebted poor countries (HIPCs). Additionally, the study seeks to see if this assistance has been and can be parlayed into growth and investment for the HIPCs.

Why Nations Fail takes an in depth look into why some countries flourish and become rich powerful nations while other countries are left in or reduced to poverty. Throughout this book review I will discuss major arguments and theories used by the authors and how they directly impact international development, keeping in mind that nations are only as strong as their political and economical systems.