Tomorrow in Islamabad, Nadeem Ul-Haq is giving back-to-back lectures on his recently-published book called: "Looking Back: How Pakistan Became an Asian Tiger by 2050". In this book, the former Planning Commission boss creates a fictitious narrative of how world's leading economists would study Pakistan's hopeful economic turnaround by the year 2050.
The book is a non-academic, airport-read to present to a wider audience how Pakistan can achieve a miracle and transform itself from a poverty-ridden, malnourished, corrupt and aid-dependent country in 2015 to qualify as a high-income country and rank among the top-decile nations in competitiveness and social progress indices by 2050. This may sound like building castles in the air. But throughout this book, Nadeem is essentially trying to say that another future is possible. How exactly is it possible? Well, that is what fictions are made of.
BR Research has already commented on the earlier unpublished draft of this book in its column (titled: Pakistan's donor driven economy, Jun 27, 2016), where we had shed light on Nadeem's critique against the donor-driven economy. That column concluded with a hope that "Nadeem and his peers would soon start looking at the cultural, religious, historical, and other normative or qualitative factors that have played a role in Pakistan's perverse state-society relationship."
In that vein, the published version of the book has a refreshing emphasis on- complexity- in economics, a notion that draws heavily from alternative economic discourse- the likes of behavioral economics, evolutionary economics and even Marxism. (Read also: Homo economicus is dead; long live Homo sapiens, Dec 3, 2014)
For instance, Nadeem argues that- institutions can emerge as social organizations evolve out of agent interaction without the need of any state intervention. Or that- the dominant narrative of how Europe came to rule the world seems to argue for the spontaneous emergence of institutions such as democracy, market competition, and the scientific method. While the causal factors of this emergence continue to be discussed, models of complexity perhaps would offer an approach to understanding and analyzing it. Meaning: Anglo-Saxon institutions shouldn't be construed as Pakistan's forgone destiny.
The implication of these and other aspects of complexity is the realization that- the government and the private sector co-evolve according to the needs of the time. He maintains that agents vary in skills, education, race, and are connected in societal, political and organizational relationships, and the implication of this realization will have to first result in better understanding of local economy, culture, notions of normativity leading up to the formation of local thought.
This column agrees with the need for local thought, and often reflects on it in this space. For instance, in "Finding the right corporate framework" (published June 9, 2016) this column argued that instead of simply following or copy-pasting international best practice of corporate governance at the behest of donors, the regulators need to address the needs of the local economy.
One of the key ingredients in Nadeem's recipe for success is the bottom-up approach. He asserts that bottom-up approach is critical for local flair and innovation, and also to allow markets, institutional, and capital arrangements to emerge. But does he also think that the impetus of reforms in Pakistan's economy must also be bottom-up - the kind of argument made in BR Research column "No representation without taxation" (published Nov 8, 2016)? Nadeem had criticised that thought. Hopefully, his lectures would shed some light on this.
Another area where Nadeem's lectures will hopefully touch upon is the 'how-to' part. The crux of Nadeem's argument is this: there will be a spontaneous rise of thinkers and public intellectuals who will present home-grown, original ideas with evidence. The Pakistani intellectuals began to wake up. Thinkers and motivators began to debate and discuss ideas for change, and this 'intellectual ferment' will "challenge and expose the current system, allowing change to happen", writes Nadeem.
He wrote that Pakistani society and economy would change as a consequence of the rise of the intellectual ala the cultural roots of French revolution and the- intellectual movements of the Renaissance whose origins are difficult to reduce to the influence of any one event or person or cause.
This view raises two questions that Nadeem would hopefully answer tomorrow. First, who would give these Pakistani intellectuals the space to challenge the status quo which is (to some degree) also powered by the powers that be? Or does Nadeem think that Pakistan's intellectual elite will create their own space and are willing to sacrifice as did the likes of Voltaire and Marquis de Condorcet in their rise against the status quo. (Read also BR Research column "Status quo of the masses", Sep 21, 2016).
Second, what is Nadeem's assessment of Pakistan's thinkers and public intellectuals? Does he think that these folks are original thinkers who are not apologetic to draw from the pool of cultural and religious wisdom of this region? The visible lot of Pakistan's thinkers and public intellectuals are those who reproduce their preferred wisdom from the likes of Smith, Marx, Hobbes, Locke, Friedman, and their western contemporaries. If Pakistani thinkers are selling imported thought, then can they really be the driving force behind home-grown economic and social policies?
Lastly, Nadeem's turnaround story barely mentions the role of education, save for the demand for education. "For decades, donor consultants bemoaned the poor enrollments and high dropout rates, without understanding the demand for education. During the period of low social mobility and high rent seeking, where the rich could rely on their rents and the poor were shut out of good jobs, the low returns to education did not inspire strong demand."
Looking back from 2050 he writes, "now that the market is booming and entrepreneurship is exploding, fresh thinking and new skills are constantly in demand" returns to a good education are now high and clearly visible. As a result, demand at all levels of education is strong and drop-out rates continue to fall."
As Amartya Sen notes in his book, "The Uncertain Glory", the spread of literacy across the world has been achieved overwhelmingly through state education. State action in education was the basis of transformation in Europe and America in 19th century, followed by Japan (in late 19th and early 20th century), Soviet Union, China, Vietnam and even East Asia, which otherwise stood as a regional champion of private market economy in general.
Evidence also abounds that a country need not be rich for the provision of universal education. Within India, the states of Kerala, Himachal Pradesh and Tamil Nadu are some of the successful examples of how emphasis on universal education significantly improved their respective economies.
Even Adam Smith, who provided the classic analyses of how market mechanism can work successfully, wanted a much greater use of state resources for public education. "For a very small expense the public can facilitate, can encourage, and can even impose upon almost the whole body of people, the necessity of acquiring those most essential parts of education," wrote Smith.
What exactly are Nadeem's thoughts on the role of education in Pakistan's turnaround, and his view on who can provide it? Hopefully, his lectures tomorrow will help start a debate on such issues.
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