In this paradigm, he argues, bureaucracy inevitably piles up, money is squandered, and in the end little progress is made. Despite billions of dollars having been spent over half a century, poverty is far from gone. In his book The White Man’s Burden, Easterly is contemptuous of the historical Western model for foreign aid. On the other side of the debate is William Easterly, an economist from NYU and former economist at the World Bank. In his famous 2005 book, The End of Poverty, Sachs audaciously wrote, “extreme poverty can be ended, not in the time of our grandchildren, but our time.” How does Sachs say we can do that? By pumping billions of dollars from the developed world into the underdeveloped world, washing away malaria, diarrhea deaths, and famine through a torrent of American greenbacks.

In the first camp are the so-called “Utopian” planners, led by economist Jeffrey Sachs of Columbia. More recently, several schools of thought on development economics have emerged at opposing extremes. Since the Second World War, economists have feverishly studied the underdeveloped world, mapping out causes and potential solutions. Why? This enormous gap in economic performance between the West (Europe, the U.S.) and the rest (Africa, most of Asia and Latin America) is one of the most troubling and perplexing questions of the modern world. California has soared economically, while Liberia remains in squalor. California and the United States rank 15th. Moreover, the United Nations Human Development Index, a conglomeration of development statistics such as literacy and infant mortality, ranks Liberia 176th out of 179 nations. Meanwhile, the 2007 PPP GDP of California alone is $1.7 trillion - an order of magnitude larger than the Liberian figure.

Economists peg Liberia’s 2006 purchasing-power parity (PPP) gross domestic product (GDP), for instance, to be about $1.525 billion. Despite these proximate founding years, these territories’ trajectories could not be more different. Just three years later, back in the United States, the territory of California joined the Union. Re-thinking Foreign Aid: Paul Collier’s The Bottom Billion and Dambisa Moyo’s Dead Aidįormer American slaves founded the African nation of Liberia in 1847.

The bottom billion review