Opinion – Issues and concerns in development economics

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Opinion –  Issues and concerns in development economics

Today, development economics occupies a central place in the teaching of economics in many universities, and indeed, as Thirlwall (1994) rather succinctly puts it, no self-respecting economics faculty is without a development economics programme. 

Development economics has become an independent and influential profession in academia and policy making. 

It has developed its own body of theory, methodologies and instruments of analysis. 

It is not an exaggeration to posit that very few professions had within such a short frame of time attained the theoretical rigour, methodological identity and maturity as did development economics. 

Despite the rapid rate of development as an independent profession, development economics is a very recent phenomenon, especially when compared to such traditional professions like political science (including political economy), philosophy, law, sociology or even mainstream economics. 

Less than three decades ago, development economics was a little-known field struggling to break away from the stronghold of traditional economics. 

Consequently, very few professional economists were willing to venture into this unknown territory and challenge the theories they had held faithful throughout their professional lives. 

The discontent was, therefore, left to the young economists – mostly from developing countries who felt the traditional economic theory was less relevant to the conditions and problems of their countries. 

They are advocating for a fundamental rethinking of the consumption and methodologies of economics as applied to the problems facing developing countries.

 

The rise of development economics

It is important to note that new professions are not born in a vacuum or a result of a far-sighted genius concerned with problems of society at some future period. 

New professions are products of particular social formations and do emerge in response to the challenges improved by these social arrangements in various aspects of society. 

The new problems that face society in a given era become increasingly difficult to comprehend – let alone resolved using old forms of knowledge. 

 These problems call for new approaches and instruments of analysis; they call for new methodologies and a completely new way of looking at social phenomena – a way that is fundamentally different from the old and in harmony with the new problems. 

Some examples of factors that necessitated the emergence of some professions in the social sciences may help to elucidate this point. 

In the emergence of classical economics in the 17th century, Europe was not a historical chance brought about by “great men of wisdom”. 

It was a direct response to understanding the new problems imposed on society by the industrial revolution, especially the relations of sharing goods and services. 

Production moved from the family backyard to the factory, and management responsibility shifted from family members to a class of professional managers – unrelated to the owner. 

Classical economics then emerged in response to these problems and challenges of the industrial revolution. 

From the classical economists of the industrial revolution, era emerged theories of the market as the theory of the firm, the theory of the consumer and the famous law of demand and supply to which modern economics is so indebted. 

So, modern economics developed as a result of a new social organisation that presented problems dissimilar to the past and called for a complete transformation of inherited knowledge. 

The emergence of development economics should, therefore, be placed within the context of a new social phenomenon, which presented problems and challenges – unlike in the past. 

The independence of the former colonies brought along with it a new multitude of new problems and challenges. 

The major problems and challenges in the new states were how to eradicate poverty, and economic backwardness and accelerate the process of development. 

The resolution of these challenges was sought in the sphere of economics.

  However, despite the consistent application of traditional economic theory, the progress in developing countries was minimal at best. 

The gap between the growth of industrial countries and developing countries was never questioned. 

Dudley Steers early in the 1960s observed that economics seems very slow in adapting itself to the requirements of the main task of the day – the elimination of acute poverty in Africa, Asia and Latin America. 

The fundamental questions were why these economies were not growing, and what governments in developing countries needed to do to enhance the pace of development. 

The resolution of these issues required a fundamental change that struck at the very essence of the traditional economic theory. 

The whole of the traditional economic theory had to be revisited, and economists had to change their attitudes and approaches to the issue of economic problems in developing countries. 

Dudley Steers (1967) correctly observed that “the challenge (of development in developing countries) demanded not only a change in the attitude of economists but a fundamental change in the theory”. 

The field of development economics emerged to the challenge of the development process in developing countries. 

It provided alternative answers and methodologies to traditional economics, which were contextualised within the socio-economic conditions of developing countries.