Tuesday, November 20, 2007

All kinds of growth

On the question how to approach a land-locked African country's development challenge, one needs to distinguish between decent growth and pro-poor growth. The former is best on the long term, the latter is not really growth but rather a form of social policy. This according to Prof Rodrik, Harvard-based economist in a recent blog post.

In South Africa we are hearing a lot of noises on this type of trickle-down growth versus a more populist pro-poor growth. The former camp highlights the fact that we may have started to turn the corner thanks to sustained economic growth, the latter camp highlights the high levels of poverty, the persistent high levels of unemployment and the sharp drop in HDI rankings.

We better have to get our numbers right. Or decide not to fiddle with and fight about the numbers but focus on (i) letting the growth-engine run as smoothly as possible and (ii) with a hawish flexibility to counter on any (unintended) side-effects on excluded third parties.

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