Rapley in this very rare methods of development assessments, equipped with for sight using a chronological approach, traces the evolution of development thought and policy making. He achieves this by contextualizing specific impacts across developing countries without sermonizing ideological orthodoxy. We are faced with a cross examination of an intellectual history of development theory with key emphasis on the unfolding scenario within contrary settings. The book is a clear manifestation of an articulacy portraying the strong presence of Keynesian thought with regard to Post Statist phase of development, while out ling the policy charges through structural adjustment and neoclassical revolutions of the 80s.
Writing using much detail coupled with his ability to manifest a continuous consistency, our author was not just able to outline proximate developmental casual factors but he was able to contextualize these factors in their various geographical and demographic settings. In the quest of having a much critical and analytical master piece assessing development, Rapley’s book stands to give us what we actually want to see, use and explore, as we parade the lane of developmental evolution.
In chapter one, the author tries to outline the progress of development. Admitting that development has come a long way in the past six decades, the author emphasizes the significance of development during the World war Two period. A period when in rebuilding and confronting new challenges unleashed a float gate of Institutions, be it the International Bank for Reconstruction and Development (which later became known as the World Bank) trade organizations. This was also a period where in there was the much talked tradition of theorizing special challenges faced by back ward regions upon sustainable paths to industrialization. W e encountered a period where the goal of development was to raise income and give poor nations access to basic necessities. Lampooning colonialism, he stresses that the effects of colonialism earnests for a better life to consolidate state independence. Thus, using a conventional ideological spectrum, the author holds that development thinking would have started among left wing branches of social science, following this trend of thinking. Notwithstanding the above view, the author holds that during early postwar period, conventional economic wisdom was not really left or right. He justifies this by upholding that a broad consensus had come to coalesce around certain core assumptions. According to the author, neoclassical theory during this period claimed that the main problem in the third world was the state itself, thus indicating that rapid development could only come about if the state was rolled back. Introducing a complexity, the author also added that new left-wing schools of thought during this era, as manifested in the dependency theory rather arose to claim that the market itself was the problem and called for a greater state’s role.
The author moves on by expressing a new emergence of critique during the 1990s. He classifies it as the post development theory, attributing influences coming from post modern current thoughts through anti globalization movements. Thus, we were again faced with a period where it seems left wing statism and right wing free marketeering were united by a common goal in the form of attaining development. Despite this view, he holds strongly that post development thought has been more heard than implemented. He justifies this by showing strongly how the continuous East Asia success since 1990s is an indication of the fact that we are returning to state led developmental model in some form. From these variations, the author laments that the evident failings of neoclassical theory in practice have caused its theorists to reconsider some of their assumptions. Thus, during the treaty of Doha, the rich countries came to accept the necessity of putting the concerns of the third world countries on the agenda if there was to be any hope of rescuing the trade talks. At this point, the author brings out his argument on the terms of trade, attributing the current shift against labor intensive manufacturing towards negative impacts for some developing countries, emphasizing forging linkages between service firms in developing countries and contractors in industrial countries as a better future model.
In chapter two, the author focuses on development theories in the postwar period. He talked of the 1944 Allied conference to provide the blue print for the postwar capitalist economy. The absence of the Soviet Union in the conference was according to the author a signaled indicating the imminent spilt of the world economy into two blocs, the western capitalist and the eastern state socialist blocs. He outlines some significant institutions. First, the IMF which was set to provide short term loans to governments facing balance of payments deficits. Second, the World Bank created to invest money in the reconstruction of the war-ravaged Europe and without a universal medium of exchange, the US dollar filled this role by default. In looking at the emergence of the third world, the author tries to draw a correlation between national income and a country’s ability to improve the social indicators of its citizenry. Thus with the exception of the few countries endowed with an abundance natural resources, the author holds strongly that there is a correlation between industrialization and the growing national income. That’s not withstanding, he maintained that other than the economic factors common to third world countries, virtually every third world country began its modern history as a colony of the former imperial powers of Europe or Asia. The made it clear that most third world nationalists argued that by using the colonies as source of raw materials and markets for finished products, imperial countries had actually impoverished the third world in order to enrich first. From this therefore, the author makes an inference indicating that third world leaders saw industry as the key to modernity and wealth by looking to the first world.
In looking at development theory after the Keynes, the author attributed western academics interest in statism towards the apparent successes of Soviet central planning in the 1930s. Introducing economists like P.N Rosenstein Rodan, the author emphasized the degree of believe most western economist attributed to the free markets. Out lining issues like the big push in infrastructure investment and planning needed to stimulate industrialization, to the extent that third world countries were too small to attract private investment. Thus, because these economists spoke of the structural obstacles blocking the third world’s path to development, they became known as the structurialists. The authors hold that structuralism did not only dominate development economics for a couple of decades but judged that the only way third world countries could remove the obstacles from their paths was through concerted state actions through industrialization and reduction of dependence on trade with the first world, increasing trade rather among themselves.
In looking at the modernization theory, he links its sprang from the behavioral revolution and the rise of totalitarianism in Adolf Hitler’s Germany and Stalin’s Soviet Union. Modernization theory according to our author sought to identify the conditions that had given rise to development in the first world, and specify where and why these were lacking in the third world. From all indications therefore, the author holds strongly that modernization theorists looked to westernizing elites, trained in the secular, bureaucratic, and entrepreneurial values of the first world, to lead countries into the modern age. He noted that modernization theory outlines the left-right divide was back.
In looking at the dependency theory, the author makes it clear that although it had its roots in Indian nationalists; it first came to light in ‘The Political Economy of Growth by Paul Baran in the 1950s. In trying to bring out the difference, the author indicates that whereas modernization theorists saw first word as guiding third world development through aid and investment, Baran rather argued that first world actually hindered the emergence from poverty of the third world. In analyzing dependency theory, the lays emphasis on the fact that foreign policies of the first world countries are only concerned primarily with the promotion and protection of capitalist interests. He justifies this by relating striking alliances with the dominant classes of third world, the dependent bourgeoisies with the capitalist states of the first world. This he outlines rather keep third world countries backward while wealth and privileged position of the third world ruling class are preserved. His argument here rests on the fact that as long as third world economies were linked to the first world, they could never break free of their dependence and poverty. Thus, he strongly urges the need for autonomous national development strategies.
Looking at statism in the third world, he made mention of the fact that colonialism left behind immature capitalist classes. He uses a logical frame work argument to out pour a comparative advantage over foreign trade as an essential component in rapid economic growth. Thus, instead of autarky, most third world countries opted for development strategies with blended approaches and exploited comparative advantages. He introduces the import substitution industrialization while acknowledging that it can be achieved by restricting imports of goods in question by tariffs and taxes on imported goods. This he maintained, went on to become one of the twentieth century’s boldest and most wide spread economic experiments.
In chapter three, he focuses on state led development in practice, indentifying the early decades of import substitution industrialization using examples from Latin American countries and Africa, where he uses Ghana before talking about the movement of ISI into some south East Asian countries like Taiwan and South Korea. He identifies state led development achievements during 1930s and also during the course of India’s first five year plan, from 1951 to 1956. He mentions the Marshall plan during the postwar economy, the devoted energies of donor agencies in trying to recover old debts and improve the solvency of their debtors. Thus, revenues from primary products were being used to pay off old debts instead of fueling industrial development. He identifies cases were projects built with borrowed money lay idle without materializing the anticipated economic growth. Unleashing the fruits of postwar development strategies he identifies as short comings the following; poor export performance, inefficiency, underemployment, poor agricultural performance, corruption wherein he cited third world dictators like Mobotu Sese Seko of today Democratic Republic of Congo and Ferdinand Marcos of the Philippines. He tries to look at the theoretical perspectives on statist development theories as a failure and why a failure? In this regard, he argues that statist theory ran into problems in its more radical version with specific, the dependency theory where it manifest insufficient microeconomic theory and fails to deal with issues of incentives. Second, the theory’s conception of the domestic bourgeoisie as parasitic and dependent on foreign capital was simplistic. The author concludes here that time is of great essence in softening the harsh assessment of ISI and that by 1970s, those who favored an interventionist role of the state had become so discredited by the excesses and political weaknesses of the left, that they would be swamped in a tide of the right-wing critics.
In chapter four, the author introduces the neoclassical answer to failure. He identifies the neoclassical tradition with the assumptions that the most productive economy will be one in which individuals are allowed the greatest freedom to engage in activities and reap full benefits of their labor. He holds the view that classical liberalism stressed individualism above all else with the left wing creating maximum freedom where people would not only realize their potentials and pursue those things in life at which they were best, but also become responsible and self reliant He made mention of the fact that a new current in the political theory of development that challenged the statist approach arose and manifest itself as the new political economy. However, this new approach rather took the neoclassical assumption that humans are rational utility maximizes and applied it to politics. This he noted was further elaborated in the works of Robert Bates on Sub Saharan Africa. In his research, he found out that governments in Africa seemed biased against the farm sector, identifying currency over valuation and pricing policies as measure break down for keeping prices on farm products low there by subsidizing the urban population’s food bill.
The author sees the underlying neoclassical theory as some sort of trade optimism, indicating that trade could be relied on for growth. Thus, economic planning was not needed to alter the structure of production; agriculture should rather be left free to flourish. From a theoretical to a practical perspective, Rapley substantiate that in a number of third world countries, governments had already begun experimenting with ingredients of the neoclassical recipe to deal with their own problems. Using examples like Ivory Coast, Chile and Sri Lanka, he tries to access the level of implementation in these countries who adopted the neoclassical reforms by 1980. Thus in the third world, the author holds that neoclassical theory has been embodied in the structural adjustment, placing the market at the center stage, assigning the state a secondary role in development, while putting its faith in the potential of unfettered individual initiative. He talks about fiscal austerity and pressed that the more money the government spends, the more money it takes out of the economy. His argument here rests in the fact that combined effects of excessive government spending are seen in the form of withdrawing money from the economy, through taxes and borrowing and driving up interest rates. Thus, business finds it hard to attract savings restricting investment. He tries to identify the idea behind privatization and submits that, in theory; privatization should raise money for cash starved governments, enhance the normal operations of the market economy, and improve the efficiency and financial performance of the firms privatized. He attributes the argument for privatization more strongly to the political wing of the neoclassical school than by its economists. Trade liberalization according to the author refers to the effort to reduce hindrances to trade, thus maximizing the free flow of goods and services. He argues strongly that one way to liberalize domestic markets is to abolish marketing boards and supports this view taking examples from Africa where marketing boards through poor price designed to extract maximum revenues from producers were so low that they rather drove producers out of the market and dismantling marketing boards altogether made sense.
In chapter five, the author tries to lampoon on neoclassical reform in practice. He lays emphasis to the structural adjustment program, using it as a scale balance to judge neoclassical theory in action. Even though he shares the view that the structural adjustment program done the most good in Latin America, he argues strongly that it did the least good in Africa, before lampooning that neoclassical theorists appear to focus on the virtues of rolling back the state and over looked some of the problems this process would beget. He show cast Mexico as a success story of the structural adjustment program and brings out an intriguing point that even though Chile is considered today as the world’s best advertisement for the structural adjustment program, he noted strongly that Chile structural adjustment program depended less on foreign backing. According to Rapley, Africanists have been among the harshest critics of the structural adjustment and they can draw on a wealth of evidence to argue that it has done more harm than good in Africa. However, he acknowledges the fact that proponents of the structural adjustment contend that things might have become even worse had African governments not imposed structural adjustment. In justifying this they outline countries like Nigeria with an increased primary productivity but without adequate value added to production in the local economy. Thus, the author argues that neoclassical theorists may have placed too much faith in the potential of free market without realizing that inflation and high interest rates are not the conditions that inhibit investment. Lowering them therefore will not still increase economic activities sufficiently. In this vein, he sees privatization as the least effective element of the structural adjustment program.
In looking at the neoclassical reforms therefore, Rapley arrived at a significant number of summations. First, the state must be brought back into development, even if only to make structural adjustment more effective. Second, the less developed a nation is, the greater appears to be its need for state intervention. This indicates that statist policies, properly implemented, can help a country in the early stage of development, after which a gradual opening to the market, enhanced by selective state intervention should follow. Finally, state interventions must enhance rather than repress the market.
In chapter six, the author tries to look at development theory in the wake of the structural adjustment, holds strongly that in the 1990s, the World Bank began to show its concern over the negative effects of the structural adjustment. He identifies a new school of thought-developmental state theory, which has been revived in the old idea of the infant industry model. He links this new school of thought to the twentieth century’s development success stories in the Far East. This model according to the author was trumpeted in 1990s as an alternative to the neoclassical approach to development. What is interesting here is the fact that, even though its origin lay outside the academic left, it became popular among leftists in the 1990s not only for its alternative stance to neoclassical model, but also because it redeemed the much maligned state.
He introduces us to the contribution of the new institutionalism and out lines that the neoinstitutionalists stress the regulatory role the state must play in a capitalist economy, where markets do not exist in a vacuum but require a detailed institutional frame work. They also draw our attention to an economy’s cultural milieu, highlighting the way this affects both the economy and the state’s ability to regulate it. Thus, to the neoinstitutionalists, markets arise from human design and do not emerge spontaneously. The state is therefore seen as the best, if not the only agent for managing the creation of the market order in third world countries.
In drawing lesions from East Asia, the author holds the view that the rise of East Asia ‘tigers’ or ‘dragons’; Hong Kong, Singapore, Taiwan and South Korea, has been a recent breakthrough in the world political economy. These economies he noted have filled the top ranks of the world’s economies in terms of not only their overall growth rates, but also their industrial and export growth rates. This development according to the author provokes two questions; How? and Why? In accounting for this, neoclassical theorists have argued that these governments employed market based development strategies coupled with outward orientation, or essentially a non interventionist trade strategy. However, the author holds that East Asia development recipe has rather been an interventionist state, typically one that plays more roles in the economy than ordinarily advocated by neoclassical theory.
With lessons from East Asia, Rapley shares the view that where the state makes development her top priority, and commits herself to effective redistribution and proper manage of the market, such a state maximizes investment using repression to achieve her goals. He maintains that the infant industry model focuses on building up selected industries for the purpose of export. In raising industries from the ground therefore requires sums of capital beyond the reach of the private financial sector, but the state can gather these through borrowing, taxation and the sale of primary exports. Thus, to build up its engineers, technicians and skilled workers, the state must invest heavily in educating not just the children of the elite who might otherwise are able to afford education, but also the population at large. He therefore calls for an active and effective role of the sates in developing countries, especially those found in Africa, emphasizing strongly that only a greater state role will tackle problems relating to high transportation cost, and poor infrastructure and market structure causing producers to slide backwards.
In chapter seven, the author manifests strongly the end of the developmental state, indicating in a very strong paragraph that not even a handful of the least developed countries especially in Africa, can implement a developmental state approach . He justifies this by notifying the high level bureaucracies and diminishing prospects in third world countries. In looking at Africa, the author indicates the growing need to improve management practices and institutional arrangements but actually identifies the fact that there are deep economic and political causes for the crisis of the African states. He holds the view that in Africa, popular control does not preclude strong leadership and therefore noted that the key to success is for governments to generate a common consensus in favor of reform or growth. Thus, Rapley believes that African states should have rather worked hand in hand with colonialists to build a strong administrative capacity which is very essential for state growth. However, he noted that just because a government has administrative capacity does not mean it will be able to use it for developmental purposes. Thus, to overcome these huddles, states with a high degree of administrative capacity seem to become developmental when they concentrate their power in the executive branch which in return surrounds itself with technocratic elite. What a paradox of possession?
In looking at the balance of power in the global political economy, the author laments that many third world countries are weaker today than they were half a century ago. He rests his justification on the growth of national debt emerging as a key weakness of many third world countries. Attributing this weakness to the strength possessed by World Bank and IMF as creditor agencies, have obtained by the use of a form of cartelization. This therefore means that individual third world countries face united front creditor countries. He uses biblical metaphor indicating that, even though David can beat Goliath, a whole army of Goliaths will take more than a slingshot to fall. Thus, some developing countries like South Korea avoided falling into this trap of vulnerability by exercising restraint and borrowing little during the lending booms of the 1980s. Others such as Brazil remain powerful because their economies and debts are so immense that they cannot be easily isolated for severe punitive action.
Finally, the author introduces us to another school of thought, one with the aim of questioning the very idea of national development altogether. This he refers to as ‘post development thought’ and holds strongly that post development thought challenges us to rethink the entire way we conceive development , and to consider the possibility of a paradigm shift. Thus, some states regardless of the economic potential of their countries simply may not be able to engineer development in their current form, indicating clearly that success stories of East Asia may find very few imitators.
In chapter eight, he introduces a very strong rhetoric; the end of development, or a new beginning? In looking at this therefore, believes that the developmental state may have represented the last avatar of the traditional model of state led capitalist development. Thus, some countries are witnessing the resurgence of populist movements that purport to impose limits on globalization and to restore some of the control over space that they have lost. This to him is the greatly changed context in which development studies finds itself In this vein therefore, those who take an interest in development are being challenged to conceive new strategies of development. Rapley castigates clearly that bodies like the World Bank and International Monetary Fund, which come to the realization that development that does not improve the lives of poor people will only provoke resistance crisis.
In his concluding chapter, the author procrastinates that as we enter the twenty-first century, the world looks very different from what it was like at the dawn of the twentieth. He links this development trend to communication technology which is breaching the great distances separating parts of the world. Thus, in the search for a new paradigm, the author holds that development studies may now have entered a revolutionary phase. He believes that development theorists would probably do best to at least remain sensitive to culture and holding strongly that we need empirical justifications to provide that culture predetermines or precludes development. Thus, Rapley passes a catchy one that if the lessons of the past teach us anything it is that poor nations can only develop when they are being given access to first world markets without any reciprocity, lampooning that globalization is making the world not just smaller but making it possible for developed countries to have a tip of the problems of third world countries and therefore cannot leave the problems of development to the poor nations.
In summation therefore, I find Rapley’s book a master piece for development in theory and practice. It provides consistency, with empirical clarity through the use of many details. We see him on so many occasions bringing out his argument and justifying such argument using practical examples without sermonizing ideological orthodoxy.
Despite the above view point, the book fails to clearly outline a perfect definition of development. He uses the word development on more than 100 instances without given us even in his own view point a perfect meaning of development Also, discussions of education, health care and housing are very rare or totally absent in the book. Down playing such sensitive elements relating to development is in a way trying to limit the scope and ambit of development.
Finally, the author fails to link statistics of economic growth to economic development. This makes it very difficult for use to assess his standard of measurements Vis a Vis development and changes in development level. Admitting that the standard of living continues to decline especially in poor nations within Sub Saharan Africa, Rapley fails to explain how states in these geo political contexts can experience progress if the standard of living continuous to decline as he strong indicated.
Edwin N. Ngome
