Sunday, June 25, 2006

State intervention is for Muggles!

Foreign Affairs has an excellent review of William Easterly's new book on international aid and its inadequacies written by Amartya Sen. Amongst much well reasoned argument, Sen makes the following point (which is expressed, not untypically, obtusely, but which also turns Easterly’s ill thought-out wizard-wand straight back at him).

Perhaps the weakest link in Easterly's reasoning is his almost complete neglect of the distinctions between different types of economic problems. Easterly is well aware of the efficiency of market delivery when commodities are bought in a market and backed by suitable purchasing power, and he contrasts that with the usual infelicities and inefficiencies in getting aid to those who need it most. But the distinction between the two scenarios lies not only in the different ways of meeting the respective problems, but also in the nature of the problems themselves. There is something deeply misleading in the contrast he draws between them, which seems to have motivated his entire project: "There was no Marshall Plan for Harry Potter, no International Financing Facility for books about underage wizards. It is heartbreaking that global society has evolved a highly efficient way to get entertainment to rich adults and children, while it can't get twelve-cent medicine to dying poor children." The disparity in the results is indeed heartbreaking. But jumping from there to arguing that the solution to the latter problem is along the same lines as the solution to the former reflects a misunderstanding of what makes the latter so much more difficult. (That major issue is clearly more important than the minor point that J. K. Rowling was on welfare support and received a grant from the Scottish Arts Council when writing the first Harry Potter novel.) [My emphasis]

Easterly’s argument turned into a toad…

Easterly responds here but, wisely this time, keeps Harry Potter out of it.

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