02 February 2012

The highly structured thinking of Michael Lipton

Last night Michael Lipton gave a talk entitled "The State and the big push towards modern industry: 'new' economics, defunct economists, and farmers".

Michael is one of the world's leading thinkers on development.

The array of issues that he has contributed to in profound ways is staggering:

  • on the pro-urban bias in development
  • on decision making by smallholder farmers and its importance in development
  • on poverty measurement and policies and on holes in the poverty consensus (such as social exclusion)
  • on the emergence of institutions such as land reform
  • on the disconnects between poverty and nutrition
  • on mechanisms for governing competition for water amongst its multiple uses
  • on population dividends

And the list goes on. These are all topics of much discussion today. But this is not surprising as Michael is one of those rare academics who is widely respected in the academic world, but also in the policy world.

It is for this cumulative body of work at the intersection of policy, practice and academia that he was recently awarded the Leontif Prize by Tufts University.

His Sussex Development Lecture built on and critiqued the interesting work of Justin Lin, Chief Economist at the World Bank. In a couple of papers from 2010 Lin argues that we need a New Structuralism to understand growth. Old Structuralism emphasised state activity to move economies from agriculture to industry and services, essentially ignoring comparative advantage (how one evolves and uses natural endowments of a country) while the New Structuralism sees the state more as a facilitator than an orchestrator when it comes to moving from agriculture to other types of production, but always guided by comparative advantage.

In the Lecture (and in a related paper) Michael concluded that Lin's work is a good start, but it is only a start. For example he notes that Lin's paper is very much couched around growth, not poverty reduction. Michael argues that the New Structuralist approaches make it imperative that the State is more active in guiding this comparative advantage-led growth towards poverty and inequality reduction. Michael also makes the argument that the New Structuralist perspective supports (and can be driven by) science-led smallholder-agriculture led growth.

As usual, Michael made me think hard about something that it would be much easier not to have to think about at all. He has been doing that for most of us for a long time and I am very thankful to him for that.

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