Ideas, institutions key to curbing poverty: Andreas
How a society can escape poverty begins with having more, or better versions, of four things, a Bluffton University economist says.
Leading the list are more, and better, ideas, Dr. Jonathan Andreas, an assistant professor of economics at Bluffton, told a campus audience April 5. Outlining global poverty history at the university's annual Civic Engagement Forum, Andreas credited improved technology, "more than anything else," with helping alleviate poverty in the last 200 years.
"For all of human history, from 50,000 years ago until 200 years ago, everybody was about equally poor," but the last two centuries have been "an incredible story of economic change," he said.
Among the countries perpetuating that story is China, whose ongoing development is a "miracle," he said. Copying ideas from the West, he continued, has been making the Chinese more productive.
Better social institutions also aid the effort against poverty, noted Andreas, whose presentation was part of Bluffton's 2010-11 focus on the civic engagement theme of "Living with Enough: Responding to Global Poverty."
He cited education as one such institution. Most countries didn't try to educate their people 100 years ago, he pointed out, but the United States' pioneering adoption of mandatory public education is one reason why the U.S. became a wealthier nation. More education leads to more technology and ideas that make an economy grow, he added.
More capital investment-in tools and equipment-will generally make an economy more productive as well, Andreas maintained.
Finally, "enslaving hydrocarbons''-as in increased energy extraction-has also been important for reducing poverty, he asserted. Economists don't like to talk about the important role of faster resource depletion in determining economic growth, because it is unsustainable, he said. Fortunately, he continued, the American economy is becoming more fuel-efficient all the time, because sooner or later, economic growth must separate from fossil-fuel extraction if growth is to continue.
Which of the four factors take precedence will determine future prosperity, according to Andreas, who earned his Ph.D. in economics from the University of Illinois-Chicago. If ideas improve productivity more rapidly than energy extraction, for instance, wealth can increase for the entire world because those ideas can be shared and bolster productivity elsewhere, he explained. But the whole world can't burn oil at the same rate as Americans
China and other, poorer countries such as India and Brazil are growing economically, and "that's a very good thing," he said. And the "poorer world" in general is catching up with more developed nations, which have also continued to grow, he added, saying "this trend is why I'm optimistic." While the question of paying for the retirement of American senior citizens is a problem, it, too, is a sign of progress and prosperity the U.S. didn't have before, the economist noted.
Worldwide, the number of nations whose people have smaller families and longer life expectancies has risen in the last 60 years, while the number of poor nations has fallen, Andreas said. Even the poorest societies in sub-Saharan Africa are "rapidly changing," with much longer life expectancy over the last 50 years and fast growth during the past decade, he said.
A Bluffton faculty member since 2007, Andreas encouraged his student listeners to travel abroad and experience poverty, as he did after earning his bachelor's degree in American studies from Grinnell College in Iowa. He worked, volunteered and bicycled for three years in Asia and Latin America, where he first became interested in economics.
Spending time in poorer parts of the world will help travelers understand both history and the modern world better, he said, and the money they spend will help people who live in those places.
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