BSRS 2022: Capitalism, Inequality, and the Myth of Catch-Up Development (Jason Hickel)

Prevailing narratives in international development hold that poorer countries can and will "catch-up" with richer countries through the process of capitalist growth. But catch-up development is an illusion and is impossible for several reasons having to do with the structure of the capitalist world economy.

Capitalism in the core states relies on patterns of net appropriation from the periphery in order to stabilize growth and accumulation. This dynamic produces global inequality and precludes the possibility of catch-up development.

Furthermore, the levels of resource use and energy use in the core states are not universalizable, and are incompatible with a habitable Earth-system. In reality, achieving convergence in the world economy – and real progress in human development – requires fundamental changes to the balance of power in international trade and finance, with an emphasis on economic sovereignty and socialist policy in the global South. Such transformation will require an anti-colonial movement for the 21st century.

This session is chaired by Professor Haldis Haukanes, University of Bergen.

Jason Hickel is an economic anthropologist, author, and a Fellow of the Royal Society of Arts. He is Professor at the Institute for Environmental Science and Technology at the Autonomous University of Barcelona, and Visiting Senior Fellow at the International Inequalities Institute at the London School of Economics.

He is Associate Editor of the journal World Development, and serves on the Statistical Advisory Panel for the UN Human Development Report, the advisory board of the Green New Deal for Europe, and the Harvard-Lancet Commission on Reparations and Redistributive Justice.

Hickel's research focuses on global inequality, political economy, post-development, and ecological economics, which are the subjects of his two most recent books: The Divide: A Brief Guide to Global Inequality and its Solutions (Penguin, 2017), and Less is More: How Degrowth Will Save the World (Penguin, 2020), listed by the Financial Times and New Scientist as among the best books of the year.

[ThisIsToolman]

This is the best analysis of capitalism that I’ve seen. It affirms my own intuitive understanding.

[jonlaban]

A story well told

We need story tellers like Jason that have the ability to get new ideas and ideologies into the mainstream

[balahort]

Excellent lecture Jason! Thanks for sharing this and this is one reason I treasure the social media, because I could access this powerful knowledge.
To true...
...but then capitalist are everywhere, even in developing countries who have captured the State or run the state by crony capitalism serving themselves and the Global North. Leaders or elites in developing countries are not angels (Public choice theory) and one proof is poor spending in human capital (Sen's capability approach) from their budget, which IMF and World Bank are not stopping, at least now. So, how to deal this? Even for effective social mobilisation or revolution to happen we need basic mass education and health. If these are not provided people will be forced to buy them and supply votes just to live. Why not a new structural adjustment movement in North for development or investment in human capital in south?

[lifetheuniverse]

I have a hunch that inequality in China vs. north has mainly decreased in Hong Kong...

[Achrononmaster]

@23:50 rise of equity in the global south is not necessarily "inherently inflationary" for the global north. It depends on the currency monopoly (government) in the global north. They are price setter, not price taker. The dynamic is that of a relative price adjustment, the extracting industries go down, the domestic producers go up. If the extractors have more political power then the effect would be inflationary, which the exploiters fight to reverse through imperialist tendencies and economic warfare. If domestic producers have more power then the government can choose to support domestic workers wages and the real inflation from the loss of income + goods from the global south, which turns into a mere nominal inflation, a currency regauging, which does not hurt the poorest in the global north (the "consumer basket of goods" their incomes can purchase is unaltered). The relative prices then adjust "correctly" which is to say _morally_ in the proper direction.

[jimr]

One thing for certain, the climate change policies being promoted by wealthy counties will inhibit development in the developing world. The most fundamental resource is access to energy. If the wealthiest countries of the world were to lose their access to reliable energy, their "wealth" would plummet.

[robertdude]

Hi Jason, I was wondering why you have not offered a critique of Jordon Peterson and Bjorg Lomborg's claims about how best to address climate change and the plight of the languishing nations. It sure would be a worthy project--given the amount of air time their ideas are getting.

[Achrononmaster]

@41:00 critical mistake here. Governments do not _need_ foreign currency if they issue their own. They pay the price in the exchange rate, so they _must_ float the exchange rate and allow the pass-through price adjustments. Who then domestically "pays the price" can be fairly distributed so the workers don't get hit hardest. That requires governments being disciplined to force the pass-through inflation hit entirely upon people who already have the most savings. If they are disciplined that's a good thing, since inflation supported by keeping the lowest real wages on parity psychologically encourages savers to spend, which helps drive production.
It's all about handling the inflation from forex pas-though well, you let inflation go through, but control it by boosting the minimum wage and tax off the top end of town, but using automatic taxes, no hikes, just a progressive rate. If you do it well, your country's rise out of import dependence is inevitable, provided no one attacks you in some economic or other warfare (UN Articles aught to prevent that, but ask the people of the Donbas... the UN is not doing that so well).

[vivianoosthuizen]

I am wondering if those that think the climate or weather is possible to be managed by humans consider what caused the ice age and if humans caused it

[Achrononmaster]

@12:00 GDP is not a measure of "economic growth" in any sense I would think of growth (a positive thing). Blowing up bridges, ruining the ecology, and burning houses all _add_ to GDP. GDP is an expenditure measure, not a growth or health measure.

[Eusebeia]

How about the Global South increasing education in the trades such as welding, pipe fitting, electrical, carpentry, roofing, and road building along with engineering and business skills so that a more skilled workforce could build the infrastructure and businesses with skilled jobs? Transporting over paved roads with trucks instead of muddy roads with bicycles would save a lot of labor. Also ignored is the massive build-up of coal-fired electrical plants in China severely polluting even Japanese air at times.