Book on poverty is worth a look

Authors Daron Acemoglu and James Robinson in their book, Why Nations Fail: The Origins of Power, Prosperity and Poverty, offer an interesting take on the patterns of poverty in Africa. In their book, which is just beginning to catch world attention, they offer the premise that countries perform differently in the temperate regions of the world, as opposed to the tropical regions. Temperate regions are characterized by moderate temperatures, weather and climate. Tropical regions exhibit warm to hot, moist climates, such as may be found in much of sub-Saharan Africa. On the continent, temperate regions are in Northern Africa and Southern Africa.The two authors suggest that geographical factors can have direct economic consequences. The map of Africa seems to bear this out. The temperate mainland African countries have average annual incomes above $2,400, ranging up to over $12,000. These countries include Morocco, Tunisia, Algeria, Libya and Egypt in the north, and South Africa, Namibia and Botswana in the south.Tropical mainland African countries, except Equatorial Guinea, Gabon, and Angola, have average incomes below $2,200.Why Nations Fail makes what may seem an obvious assertion that diseases and agricultural productivity are the two major factors contributing to the poverty of tropical countries. For instance, they assert that there are far more parasitic diseases in tropical areas, while disease vectors, such as mosquitoes and ticks, are far more diverse in tropical than in temperate areas. This imposes a huge burden on economies of tropical countries.Some of the reasons tropical areas average lower in agricultural productivity include pests which reduce crop yields, and higher average tropical rainfall resulting in more nutrients being leached out of the soil by rain, among other factors.The above assertions have been faulted on two counts as to why Africa is poor. Though diseases cause much suffering and deaths, they are largely a consequence of poverty and of governments being unable or unwilling to undertake the public health measures necessary to eradicate them. Likewise, one of the key reasons agricultural productivity is low in sub-Saharan Africa is mainly a consequence of the ownership structure of the land and the incentives that are created for farmers by the governments and socio-cultural institutions.The book, however, notes other factors underlying wealth and poverty. In demonstrating one of the major factors, it offers dramatic examples of the poverty differences between countries. The examples include North and South Korea, the former East and West Germany and the twin cities sharing the name Nogales straddling the border between the Unites State and Mexico, and divided only by a fence. Though the geographic environment and ethic make up are similar on both sides of the dividing fence, life expectancy and average income are higher, health and roads better, and crime and corruption lower on the American side.The difference between the two sides of the border come about because the political and economic institutions which create very different incentives for the inhabitants. Rwanda does not fail mention. Acemoglu and Robinson describe the stark differences between Goma and Gisenyi in a recent blog post. They observe that “The Rwandan side is very orderly… But Goma is like a different planet. [S]een from Google Earth the chaos on the DRC side of the border is readily evident.”They place the stark difference to the two countries different socio-political histories and yet another factor, “the curse of natural resources”, that has been one of the main drivers of the conflict in eastern DRC.