Saturday, January 02, 2010

Booze and Immoral Women: Development and Control of Culture

It has become increasingly evident to global taste makers that culture rather than economics drives economic decisions individually, and in the aggregate affects the character of development (as that term is understood by those who finance, regulate and oversee the phenomenon).  Economics, like a good load bearing donkey appears to take its bundle only where directed by the tastes of those who drive the beast.  The modern foundation for view can be traced back in part to Max Weber's famous conflation of religious, ethics, and cultural behavior norms as an explanation for wealth formation and prosperity--key indicia of conventionally understood "development."
A glance at the occupational statistics of any country of mixed religious composition brings to light with remarkable frequency a situation which has several times provoked discussion in the Catholic press and literature, and in Catholic congresses in Germany, namely, the fact that business leaders and owners of capital, as well as the higher grades of skilled labor, and even more the higher technically and commercially trained personnel of modern enterprises, are overwhelmingly Protestant. Max Weber, The Protestant Ethic  and the Spirit of Capitalism (Peter Baehr, trans., New York: Penguin Books, 2001) (1904/05).
This has been understood as foundational cultural in the sense of creating attitudes toward work, family, education, and the nature of obligation that is legitimated as producing the greatest individual and communal satisfaction (on earth and after death).  On the popularity of the core assumptions and arguments of The Protestant Ethic, see Shane P. Gannon, The Popularity of Max Weber’s The Protestant Ethic and the Spirit of Capitalism: An Analysis of Historical Trends of Scholarship, Gateway | An Academic Journal on the Web: Winter 2002-2003.  Fascinating recent studies of the link between  religious ethics and values producing culture, education and prosperity include  Maristella Botticini  and Zvi Eckstein, Jewish Occupational Selection: Education, Restrictions, or Minorities?, The Journal of Economic History, Cambridge University Press, vol. 65(04), pages 922-948 (December, 2005);  and Sascha O. Becker and Woessmann, Ludger, Was Weber Wrong? A Human Capital Theory of Protestant Economic History (May 2007). CESifo Working Paper Series No. 1987; IZA Discussion Paper No. 2886 (linking the religious command to literacy to education and thus to cultures of conventionally measured prosperity). Becker and Woessman suggest that "But we also show that there is a strong association between Protestantism and literacy, confirming the basic tenet of our suggestion that Luther’s preaching advanced education. When Protestantism and literacy are entered jointly in a “horse race” to explain economic prosperity, the association between Protestantism and economic outcomes vanishes, and the whole effect is absorbed by a significant association between literacy and economic outcomes."  Id., at 3.

Yet, the connection between development, wealth and behavior, as strong as it is, might not be so simply confined to the benefits of literacy.   Two recent contributions to global conversations in development suggest the continuing strength of the moral and cultural aspects of behavior in global efforts in aid of development.  In effect these suggest that the way to prosperity lies not in institutional ideology so much as in the management of culture and behavior norms.  And the "protestant" model remains the ideal against which such behaviors among poor populations remains measured.  

The first appeared as an opinion piece in influential media outlets in the United States.  Nicholas D. Kristof, Sparking a Savings Revolution, New York Times, Jan. 2, 2010.  Mr. Kristof  extols the virtues of rudimentary banking and savings systems at the poorest levels of society as a means of generating wealth more powerful than microlending.  "I don’t agree with the criticisms of microloans, for I’ve seen how tiny loans can truly transform people’s lives by giving them the means to start small businesses. Even so, there’s evidence that the most powerful element of microfinance is microsavings, not microloans."  Id.  Quite rightly, Mr. Kristof points ot the useful involvement of influential civil society actors in the development of financial services for the neediest sectors of the populaiton of developing countries.  "Many aid groups including CARE and Oxfam now offer savings programs in some form, and the Bill and Melinda Gates Foundation is studying how best to promote financial services for the poor. A Web site,, lets donors match a poor person’s savings to increase the incentive to build a savings habit."  Id.

So far so good.  But then we get to the heart of the matter and the analytical tone changes--and in the process becomes somewhat more revealing.  The heart of the analysis goes to the essence of an important facet of development--winning the "hearts and minds" of the objects of development:
One of the ugly secrets of global poverty is that a good deal of suffering is caused not only by low incomes but also by bad spending decisions. Research suggests that the world’s poorest families (typically the men in those families) spend about 20 percent of their incomes on a combination of alcohol, cigarettes, prostitution, soft drinks and extravagant festivals.In one village here in Nicaragua where children were having to drop out of elementary school because they couldn’t afford notebooks, a midwife, Andrea Machado Garcia, estimated to me that if a man earned $150 working in the mountains as a day laborer during the coffee harvest, he might spend $50 on alcohol and women and bring back $100 to support his family. Id.

The foundation of development, in effect, is a "lifestyle" issue.  In order to accelerate development, the object of these efforts must learn to avoid "bad choices" and dissipation.  Booze and broads appear to be the death of the poor in developing states.  And decent women seem to be able to little to "fix" this bad behavior, which produces not only weaker marriages (judged from the salons of New York, itself an irony of sorts) but also produces, in the aggregate national dissipation.  The solution is to separate these men from their money (and make it more readily available to their spouses and children).  The provision of financial services, then, is not merely a wealth producing device, but an instrument of moral and cultural change. 

Development is thus, to some extent, both gendered and moralistic.  Economic rewards follows from making the "right" choices--each of which is assigned a value that produces measurable economic gain in ways that fit into the model suggested as best for the culture into which it is introduced. Not that this is wrong or wrongheaded.  But it's roots in 19th century assimilation--once turned inward to help the unwashed and uneducated masses from Eastern and Southern Europe  to embrace the social and economic norms of "Americanism" are unmistakable--as are the religious  connections.  And, indeed, those connections are readily apparent in the strong efforts of Evangelical Christians to convert the Catholic masses of Central America to Protestant Christianity--and with it to assimilate these masses into a distinct framework of values.

The second presents the results of an excellent study by Alberto Alesina, Guido Cozzi, and Noemi Mantovan on the relationship to social toleration of inequality and the values systems used to make those evaluations.  Alberto F. Alesina, Guido Cozzi, and Noemi Mantovan, The Evolution of Ideology, Fairness and Redistribution, NBER Working Paper No. 15587 (December 2009).
 The same level of inequality may be more or less acceptable by different individuals in different countries depending upon their beliefs that wealth has been accumulated with effort and ability rather than by luck, connections or even corruption. In one word whether different levels of income and wealth are "deserved" or not. These views about inequality and justice (which we may label "ideology") determine tax rates and the evolution of the distribution of income and wealth.  Id., at 1.
The authors "provide a politico economic model that can trace over time the evolution of polices (tax and transfer schemes), the evolution of inequality, and of the preferences for redistribution, as a function of changes in what individuals perceive as fair and unfair wealth differences." Id., at 2.  Poverty, as an exogenous concept (exogenous because in effect the baseline for valuation is ta in fact a benchmark and generated from outside the societies that are the object of measurement), can be measured as a function of beliefs about wealth. 
According to our simple framework, ideology does not entail cognitive distortions of reality, but it shapes the moral judgement on what wealth distribution would be fair, as well as it internalizes into people's preferences how strongly the distance between the current wealth distribution and the fair one makes people unhappy. Our model is consistent with a variety of observations about the relationship between inequality, redistribution, and persistence of poverty which could not be explained with more standard models of redistributive policies.  Id., at 26.
And thus a "fearful symmetrie" (William Blake, The Tiger, No. 489, in Arthur Quiller-Couch, ed. 1919. The Oxford Book of English Verse: 1250-1900) between the implications of this study and the presumptions grounding Mr. Kristof's analysis about inverse relationship between money and immorality (conventionally understood in the West) and the salutary effects of financial services in the service of bourgeois values (and consequently, of wealth accumulation). 

The missionary aspect of development, therefore, ought not to be underestimated.  Nor, conversely, should the resistance likely to the that missionary aspect.  A careful balance between respect, management and change implicates not merely economics and culture, but the politics of subordination, cultural chauvinism and the temptations of exploitation by all participants.  These recent writing suggest that the cultivation of culture--especially as ethics and morals, will play a large role in the legitimation of what will ultimately emerge as successful models of development.   See, Larry Catá Backer, Values Economics and Theology: The Contribution of Catholic Social Thought and its Implications for Legal Regulatory Systems (December 4, 2008). Coalition for Peace & Ethics Working Paper No. 2008-1/1.  This is, ironically, missionary work indeed.

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