Human Development: Means and Ends

Sometimes the change in the fashions of thinking about development appears like a comedy of errors, a lurching from one fad to another. Economic growth, employment creation, jobs and justice, redistribution with growth, basic needs, bottom-up development, participatory development, sustainable development, market-friendly development, liberation, liberalisation, human development; thus goes the carousel of the slogans. But this would not be a correct record. There has been an evolution in our thinking about development. Both internal logic and new evidence have led to the revision of our views. Previous and partly discarded approaches have taught us much that is still valuable, and our current approach will surely be subject to criticisms. A brief survey of the evolution of our thinking may be helpful. The discussion started in the 1950s, influenced by Arthur Lewis (1955) and others, who emphasised economic growth as the key to poverty eradication. Even at this early stage, sensible economists and development planners were quite clear (in spite of what is now often said in caricature of past thought) that economic growth is not an end in itself, but a performance test of development. Arthur Lewis defined the purpose of development as widening our range of choice, exactly as the Human Development Reports of the United Nations Development Programme do today. Three justifications were given for the emphasis on growth as the principal performance test. One justification assumed that through market forces–such as the rising demand for labour, rising productivity, rising wages, lower prices of the goods bought by the people–economic growth would spread its benefits widely and speedily, and that these benefits are best achieved through growth. Even in the early days some sceptics said that growth is not necessarily so benign. They maintained that in certain conditions (such as increasing returns, restrictions to entry, monopoly power, unequal distribution of income and assets), growth gives to those who already have; it tends to concentrate income and wealth in the hands of the few.