Macabre Explanation of Opportunity Costs

[tcpip]

For those who haven't seen it...

I think dead children should be used as a unit of currency. I know this sounds controversial, but hear me out.

Comments

[goumindong]

The two sentences were separate. There is a technical argument, which is simply wrong (that aid is killing people) and an emotional argument (that we should not try because it also enriches bad people)

In short, the data and counterfactuals simply do not support the claim that aid has negative consequences.

Take the argument as presented in the link above. He claims that in the absence of aid, Kenyans would trade for food... with nations who also don't have food.

He then claims that this would make Kenya better off, but why? If Kenya is truly receiving aid and this is causing people to not be able to farm and sell crops(as he claims) then why are these people not restructuring into valuable economic activities?

Certainly that would be the more rational long term outcome if it were also true that Kenya would be able to trade with other nations. Its a broken window fallacy, a failure to understand opportunity costs coupled with this weird idea that over the long term, a poorer society has an easier time of escaping from despotism (in its many forms)

Sorry, i don't buy it. Its not internally consistent and it doesn't fit the data (for instance many nations in Africa have done well with receiving aid, why where they not crippled by this terrible burden of free stuff?)

For a better examination of the situation, Jeffry Sachs wrote a great book called "The End of Poverty" and while it certainly looks like its some idealistic utopia book, it really is a down to earth rational assessment of the situation and how, with careful examinations we can bring these places out of poverty(and why aid campaigns in the past have not been as effective as they could be).