For a new macroeconomic policy in Colombia

In April 2021, Ivan Duque’s administration presented a tax reform bill labeled “Law of Sustainable Solidarity” to Congress. The bill contemplated an increment of the VAT on basic goods in conjunction with an increase in the marginal tax rates on the income of the so-called Colombian middle class. The vast majority of whom earns monthly less than 4,000,000 Colombian pesos (around 1,065 U.S. dollars). Although the bill put on the table contained some crucial elements for discussion, such as implementing a “basic monthly income” of 21 U.S. dollars (by far less than the current minimum wage). It contained little or nothing to effectively tackle Colombia’s high social and income inequality (with an official GINI of 0.526 for 2019).

The tax reform bill was presented in the mid of a severe economic and social crisis that had worsened due to the pandemic and against which the Colombian government has done hitherto little beyond the orthodox recipes. This triggered a general strike and nationwide social mobilizations that have already lasted over more than two weeks without any clarity as to their resolution as yet. The current social protest can be considered a continuation of a general strike that erupted at the end of 2019 and got into a rest due to the pandemic.

Yet, many elements behind the social movement go beyond dissatisfaction with the tax reform bill. Since 2016 after the peace deal between the Colombian government and the FARC, which used to be the oldest and biggest guerrilla in Colombia, the government hasn’t implemented most of the elements contemplated in the peace agreement. Also, although Colombia has had macroeconomic stability for more than 20 years, an indicator such as the official unemployment rate has consistently been above 10%. The level of poverty before the COVID-19 shock was near 32%.

Thus, the following question arises, what does it mean to have macroeconomic stability to the population? A call to think outside the box on what the government can or can’t do must be considered under other lenses. In view of the worsening of the social, political, and economic crisis in Colombia and the need to develop economic policy alternatives to the government’s orthodox position, a group of citizens and academicians wrote the open letter below to respond to those who argue the TINA mantra and believe that there’s a consensus in economics to support tax reforms amidst the COVID-19 epidemic.

Read More »

Top posts of 2020

We know, we know, most people would rather forget everything about 2020. However, before you go into 2021, we want to remind you of some of the important analyses that emerged this year, including insights that had not been adequately appreciated before. These include insights about the links between ecology and capitalism, the fragility of economies that rely heavily on precarious labor, the role of the state in shaping health systems, and how structural racism is embedded in the economy. We were honoured to be able to host important contributions to these debates on the blog this year, along with other posts on economics, politics and development.

Here are the top 10 most read posts of 2020:

  1. A crisis like no other: social reproduction and the regeneration of capitalist life during the COVID-19 pandemic (by Alessandra Mezzadri)
  2. The currency hierarchy and the role of the dollar as world money (by Giovanni Villavicencio)
  3. Is Degrowth an Alternative to Capitalism? (by Güney Işıkara)
  4. Abolition Will Not Be Randomized (by Anastasia Wilson and Casey Buchholz)
  5. The return of State planning (by André Roncaglia and João Romero)
  6. Privatization and the Pandemic (by Jacob Assa)
  7. Haemorrhaging Zambia: Prequel to the Current Debt Crisis (by Andrew M. Fischer)
  8. Pandemics and the State of Welfare (by Rahul Menon)
  9. The Economics of being ‘Interesting’: Many kinds of exclusions (by Farwa Sial)
  10. Time for a Rethink on the Worth of Work (by Paulo dos Santos)

This is just a tiny, tiny sample of the eighty posts on the blog this year. You can also follow our active blog series on State Capitalism(s) and Pressure in the City, and delve into all COVID-19 related analysis here, and book reviews here. In 2021, Developing Economics will continue to provide much-needed critical perspectives on development and economics. Want to join the conversation? Become a contributor!

Blog Series: Pressure in the City

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The Covid-19 pandemic and the restructuring of the global economy it has triggered have exacerbated the need to study a topic that has flown under the radar of social scientists for too long: individuals and social groups experiencing economic pressure which manifests in myriad of somatic and psychological ways. The fallout from pressure — sleeplessness, ulcers, an atmosphere of hopelessness and social mistrust, gambling, suicides, as well as a growing concern about a lack of mental health facilities in cities of the Global South — now pervades urban as well as rural environments around the world. This blog series aims at taking a fresh look at the phenomenon of economic pressure through a decisively comparative and interdisciplinary approach. We will critically interrogate the role of economic pressure in the lives of both the rich and the poor, the unemployed and the workforce, across class and continents in order to answer, among others, the following questions:

  • What meanings does economic pressure take on as it travels between different contexts?
  • How do city dwellers of diverse class, religious and gender backgrounds experience pressure in their professional and private lives? How do they accommodate, negotiate and deflect pressure?
  • Does economic pressure offer new analytical possibilities vis-à-vis other concepts used to describe similar phenomena (e.g. poverty, uncertainty, precarity etc.)?
  • What is the relation between individually perceived economic pressure and structural changes of the economy or polity?
  • What moral valuations do urban residents assign to economic pressure? What logics underpin ‘good’ and ‘bad’ forms of pressure?
  • How can inter-disciplinary methodological and/or theoretical approaches deepen our understanding of economic pressure —the forms it assumes, the actions it motivates and the effects it generates?

We welcome contributions from a wide range of scientific disciplines (political economy, anthropology, economics, sociology, development studies, gender studies, international relations, geography, etc.) as well as other professions (such as practicing psychologists, counselors, activists, bankers, sports professionals etc.). As the blog’s organizers are all Africanists, the blog will, however, have an initial focus on sub-Saharan and, especially, Eastern Africa. We are confident that this will be balanced over time.

  • Pressure in the City: Stress, Worry and Anxiety in Times of Economic Crisis. The first contribution to the series, written by Jörg Wiegratz, Catherine Dolan, Wangui Kimari and Mario Schmidt will detail the rationale of the series and provide necessary background information and context.
  • Urban Africa under Stress: Rethinking Economic Pressure in Cities. Written by the same four scholars, this post explains in more detail the objectives of our blog series intervention, and our observations regarding pressure as a social phenomenon in a capitalist city in the Global South. It introduces Nairobi as a city of pressure and critically discusses the scholarship on economic pressure. As such, it acts as an introduction to subsequent blogs on Nairobi as a city of pressure.
  • ‘There is a Lot of Pressure on Me. It’s Like the Distance Between Heaven and Earth’ – Landscapes of Debt, Poverty-in-People and Social Atomization in Covid-19 Nairobi. Written by Mario Schmidt, Eric Kioko, Evelyn Atieno Owino, and Christiane Stephan. This post sheds light on the multidimensional ways in which Kenya’s political elite’s response to the Covid-19 pandemic has increased economic pressure on actors living in informal and low-income settlements of Nairobi (Kibera and Pipeline). It will be followed by a second post exploring the effects of the pandemic on inhabitants of Kileleshwa, a wealthier suburb of Nairobi.
  • ‘Life On These Stones Is Very Hard’ – House Helps in Covid-19 Nairobi. Written by Eric M. Kioko, Judith K. Musa, Mario Schmidt and Christiane Stephan, this blog focuses on the economic pressure experienced by women who lost jobs as house helps following the Covid-19 pandemic and how they manoeuvre their new economic situation within Nairobi’s richer suburbs.
  • “Under pressure”: negotiating competing demands and desires in a time of precarious earnings. Written by Hannah Dawson, this post examines the social and economic pressures faced by un(der)employed young men in an informal settlement on the outskirts of Johannesburg. It highlights the multiplicity of demands on young men’s precarious incomes and the tension they experience from the simultaneous pressure to consume and improve their own lives while at the same time providing for their families and children.
  • (De)pressurizing in urban centers beyond the megacity: notes on pressure from Nakuru, Kenya. Written by Nick Rahier, this post sheds light on life ‘under pressure’ from the perspective of Nakuru, a vibrant secondary Kenyan city situated 160 km Northwest of Nairobi. It presents Nakuru as a place where pressure manifests itself as a highly volatile and affective state of being that is rich in meaning about what it means to (de)pressurize beyond the megacities.
  • Less flow, more pressure: accessing water in N’Djamena in times of Covid-19. Written by Ismaël Maazaz, this blog post looks at state policies designed to mitigate the economic pressure weighting on water end-users of N’Djamena, the capital of Chad in the midst of the pandemics in 2020. Such policies adversely affected the actual pipe water pressure, generating additional challenges.
  • Inner-city pressure and living somewhere in-between. Written by Aidan Mosselson, this blog post traces the (pre-covid-19) experiences of people living in social and affordable housing in inner-city Johannesburg. Inner-city residents contend with economic pressure, as they work hard to pay their rent and often forgo other forms of social interaction whilst they strive to get by. But pressures are also more-than-economic, and emanate from difficult and unpleasant environments and concerns about safety. Combined, these pressures create a state of resignation and being in-between, of living in an undesirable area, aspiring to be elsewhere, but unable to find somewhere better and still affordable.
  • Living in the shadows of Dubai. Written by Jonathan Ngeh, this blog post draws on the lived experiences of African migrants in Dubai to shed light on how economic inequality increases pressure on low-income migrants. Furthermore, it reveals how the existence of poverty alongside wealth puts pressure on not only the poor but also on the wealthy city residents.
  • Pressure to Succeed: From Prosperity, Stress (A reflection on aspiration in the new Kenya). Written by Peter Lockwood, the blog post draws attention towards the subjective experience of pressure to succeed, to ‘make it’, and live a good life, by Kenyan youth living on the northern outskirts of Nairobi. Departing from a purely economic understanding of pressure in the city, the blog highlights the feelings of shame and failure harboured by Kenyan youth unable to accumulate the wealth that would allow them to live good lives according to mainstream understandings of economic success’.
  • The pressure to provide and perform: Anti-feminism, masculinity consultants, and the threat of male expendability in contemporary Nairobi. Written by Mario Schmidt, tries to open a space for critical debates about how capitalism affects gender relations by exploring the relations between the sorrows of heterosexual migrant Kenyan men who increasingly feel under pressure and Nairobi’s blossoming sphere of toxic masculinity consultancy.
  • Layers of compounding pressure: the gendered experiences of rural migrant youth in Addis Ababa, EthiopiaWritten by Elizabeth Dessie, this blogpost explores the gendered ways in which rural-urban migrant youth experience pressure in a post-pandemic Addis Ababa, highlighting how strategies devised to counteract pressure are central to migrants’ everyday lives, despite synchronously creating new layers of social and economic strain.   
  • The Salaried Man and His Others: Rethinking Pressure in the Longue Durée. Written by Jordanna Matlon, this blog post situates the social and economic pressures that underemployed men experience in African urban informal economies within the longue durée of racial colonial capitalism and its accordant breadwinning ideology. To do so, it introduces the colon (colonist) statue, a fixture of West African popular art and figurative embodiment of colonial-era social and economic transformations in which masculinity became inextricably linked to the salary.    
  • Working Overtime or Being Laid Off: The Pressure under Hopelessness among Workers in Chinese Internet Companies. Written by Yun Xiong, this blog aims to investigate the relation between the immense working overtime pressure of workers in Internet companies in China’s big cities and the feelings of hopelessness regarding career and life prospects amid the country’s economic downturn. This, in turn, drives the phenomenon of excessive workloads as workers strive to avoid the risk of being laid off.
  • What Pressure Produces: The Generative Aspects of Pressure amidst Urban Displacement in Dakar. This blog post by Gunvor Jónsson explores what is produced by pressure, examining how traders evicted from a market in Dakar (Senegal) responded to persistent uncertainty and economic pressure following the demolition of their market. It argues that the economic uncertainty and sense of disorientation and uprootedness associated with the eviction had led to a kind of urban diasporic formation among the displaced traders. The analysis thus contributes a temporal perspective on pressure, showing what urban dwellers’ responses to pressure may generate in the longer term.
  • The city of the evicted: lives under pressure in the margins of an urban fantasy in Benin. Written by Joël Noret and Narcisse Yedji, the blog post explores the multi-layered consequences of the eviction campaigns that have taken place in Cotonou, the economic capital of Benin, since current president Patrice Talon came to power. Generating multiple and intertwined forms of pressures, such destructions have turned thousands of lives upside down, causing considerable psychic distress while durably affecting the life chances and economic prospects of already vulnerable city dwellers.
  • Absorbing pressure: Bodily ‘tension’ in a changing Himalayan world. Written by Nikita Simpson, this piece examines how such pressures are not evenly distributed across the community but are absorbed by particular people through the experience of bodily and mental tension. Tension, Simpson argues, both registers these pressures in the body, and allows people to push back against them, issuing a particular and paradoxical account of power and the body.

Blog series editors:

Jörg Wiegratz is a Lecturer in Political Economy of Global Development at the School of Politics and International Studies, University of Leeds, and Senior Research Associate, Department of Sociology, University of Johannesburg. j.wiegratz@leeds.ac.uk.

Elizabeth Dessie is a postdoctoral fellow at the African Cities Research Consortium at the University of Manchester. elizabeth.dessie@manchester.ac.uk.

Catherine Dolan is Professor in Anthropology at SOAS, University of London. cd17@soas.ac.uk

Wangui Kimari is a Postdoctoral researcher at the African Centre for Cities, University of Cape Town. kuikimari@gmail.com

Mario Schmidt is postdoctoral Fellow at the Max Planck Institute for Social Anthropology (Halle/Saale, Germany). marioatschmidt@gmail.com

Photo by cheng feng on Unsplash

Top posts of 2019

Keep Calm and Blog on

As the year comes to a close, we look back on our most read posts of the year. It’s been a busy year, with over 40 blog posts and two blog series (on financial inclusion and state capitalism) published. The readership of the blog has grown rapidly, the editorial board has expanded, and this year the blog was included in the Top 100 Economics Blogs of 2019 by Intelligent Economist for the first time.

Most read posts of 2019:

  1. Why so Hostile? Busting Myths about Heterodox Economics (by Ingrid H. Kvangraven and Carolina Alves)
  2. The Curious Case of M-Pesa’s Miraculous Poverty Reduction Powers (by Milford Bateman, Maren Duvendack and Nicholas Loubere)
  3. Using Marx as a Pejorative to Defend the Ease of Doing Business: Analysing The World Bank’s attack on CGD (by Dissenting Voices)
  4. The Green New Deal: Whither Capitalism? (by Güney Işıkara and Ying Chen)
  5. Neoliberalism or Neocolonialism? Evaluating Neoliberalism as a Policy Prescription for Convergence (by Rahul Menon)
  6. Rethinking the Failures of Mining Industrialisation in the African Periphery (by Ben Radley)
  7. An Alternative Economics Summer Reading List, 2019 (by members of Decolonising and Diversifying Economics)
  8. Philanthrocapitalism: How to Legitimize the Hegemony of the Rich with a “Good Vibes” Discourse (by Jorge Garcia-Arias)
  9. Mind the Gap: Addressing the Class Dimension in Higher Education (by Lorena Lombardozzi)
  10. Advocates of the SDGs have a monetarism problem (by Rick Rowden)
In 2020, Developing Economics will continue to provide much-needed critical perspectives on development and economics. Want to join the conversation? Become a contributor!

BLOG SERIES: State capitalism(s) – Interrogating the ‘return’ of the state in development

6a00d83452719d69e2014e86055c29970d-800wi.jpgFrom Quantitative Easing to neo-mercantilist policies, the renewal of industrial policy, the multiplication of sovereign wealth funds and marketized state-owned enterprises, increased state participation in global value chains and global networks of corporate ownership, the state seems to be ‘back in business’ everywhere. This raises a series of questions:

  • Are we witnessing a shift to state-led development? A return of ‘state capitalism’ under a globalised and financialized form? Are these processes challenging market ascendance and/or neoliberalism as a global development regime?
  • Has there been a transformation of the developmental state and of the logics and instruments of ‘catch-up’ development? New tools of state intervention for industrial and innovation policy?
  • What are the implications of the resurgence of ‘state-capital hybrids’ (state-sponsored investment funds, state-owned enterprises, development banks, etc.) as key actors in development? Are these transforming the global development finance architecture? What is the relationship between, on the one hand, state-owned, state-controlled, and state-directed capital, and on the other hand, private capital?
  • What are the wider geopolitical and geo-economic shifts in which the rise of the new state capitalism is embedded? What is new about the recent ‘wave’ of state capitalism across the global economy? What are the strategic, structural/epochal, and contingent drivers of its emergence?
  • What is the progressive potential of these developments, both in the global South and in the global North? What are the limits to the new state capitalism, and the various forms of resistance to it?

Read More »

Islamic Finance and Financial Inclusion: Who Includes Whom, in What, and on Whose Terms?

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By Lena Rethel, University of Warwick.

With the rise of financial inclusion as the new buzzword in global development circles, it has replaced earlier items on the reform agenda such as financial modernisation or financial deepening. By their very nature financial inclusion projects are inherently political – their underlying rationale is to change who has access to what forms of credit and at what conditions. Financial inclusion is both a multi-scalar and multi-faceted phenomenon. Needless to say that its dynamics play out differently in different countries and regions. However, before uncritically embracing the financial inclusion agenda as a means to achieving a more equitable economic order, more attention should be paid to what constitutes a fundamental set of questions: who includes whom, in what and on whose terms? In this blog entry, I want to highlight some of the key issues that have emerged in relation to Islamic finance. Read More »

Top posts of 2018

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While many of you may want to forget about 2018, we promise there are some good things that happened that you might want to remember. Here are the top 10 most read posts of the year. Happy new year and enjoy!

  1. An Alternative Economics Summer Reading List (by Carolina AlvesBesiana BallaDevika Dutt and Ingrid H. Kvangraven)
  2. Not just r > g but r + q >> g: Piketty meets Ricardo in the long run of Indian history (by Rishabh Kumar, California State University, San Bernardino)
  3. Historicising the Aid Debate: South Korea as a Successful Aid Recipient (by Farwa Sial, School of Oriental and African Studies)
  4. Consuming development: Capitalism, economic growth and everyday life (by Arve Hansen, University of Oslo)
  5. The World Bank Pushes Shadow Banking in the Name of Development (Daniela Gabor, University of the West of England, Bristol, and others).
  6. Keynes or New-Keynesian: Why Not Teach Both? (by Rohit Azad, Jawaharlal Nehru University)
  7. Think Positive, Climb out of Poverty? It’s Just Not So Easy! (by Svenja Flechtner, University of Siegen)
  8. Revisiting Hirschman’s Tunnel Effect and Its Relevance for China (by Wannaphong DurongkaverojAustralian National University)
  9. Why I refuse to rethink development – again (and again, and again…) (by Julia Schöneberg, University of Kassel)
  10. Marx’s Birthday and the Dismal Science (by Carolina Alves, University of Cambridge, and Ingrid Harvold Kvangraven, University of York)

Want to be a contributor to this blog too next year? Shoot an e-mail to Ingrid Harvold Kvangraven and she’ll guide you through the submission process.

 

Top posts of 2017

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2017 was a dramatic year in many ways. But before it completely flies by, let’s not forget the important contributions made to the development debate on this blog this year! Here are the top 10 most read posts of 2017:

  1. Kicking Away the (Statistical) Ladder (Jacob Assa, UN)
  2. An Economic Strategy for The Gambia? (Sanjay Reddy, The New School)
  3. Is ‘Imperialism’ a Relevant Concept Today? A Debate Among Marxists (Ingrid Harvold Kvangraven, The New School)
  4. 80 Economic Bestsellers before 1850: A Fresh Look at the History of Economic Thought (Erik Reinert, Tallinn University of Technology)
  5. Re-centering Inequality in African Economic History (Alden Young, Drexel University)
  6. e-Book Launch: Can Dependency Theory Explain Our World Today? (editorial)
  7. The Financialization of Africa’s Development (Richard Itaman, SOAS)
  8. Towards a Critical Pluralist Research Agenda in Development Economics: Some Bricks from Berlin to Build Upon (Svenja Flechtner, Freie Universität Berlin, Jakob Hafele, Vienna University, and Theresa Neef, Freie Universität Berlin)
  9. 200 Years of Ricardian Trade Theory: How Is This Still A Thing? (Ingrid Harvold Kvangraven, The New School)
  10. Advancing a Research Agenda of Scarcity, Abundance, and Sufficiency (Adel Daoud, University of Cambridge)

Read More »