World Group Bank President Jim Yong Kim and Minister of Finance of Colombia, Mauricio Cardenas, visit a farm of cacao trees, in township of La Paz, Colombia on January 14, 2016 Photo © Dominic Chavez/World Bank

The Many Lives of Economic Development Expertise

Economic Development Expertise in Colombia — Continually under Development?

In 2011, two employees of the Bogotá office of the consultancy McKinsey published the article “Growth, Colombian style”. They had been part of an initiative founded by the government in 2007 to help to “create and implement an economic-development program based on a public-private alliance focusing on improvements in specific industries.” In March 2017, the World Bank approved a new loan totalling US$ 600 million to maintain fiscal sustainability and accelerate productivity growth.

It was not the first development plan and not the first time the World Bank, through the International Bank for Reconstruction and Development (IBRD), approved a loan for Colombia, and — almost certainly — nor will it be the last. In 1950, the IBRD published the report “The Basis of a Development Program for Colombia,” which was preceded by a year-long stay of an “independent experts’” mission sent by the IBRD upon invitation of the Colombian government. It was the IBRD’s first project in this vein.[1] The task of these experts was the formulation of a “development” programme. Its purpose was to raise the living standard of the Colombian people and, to that end, most importantly “the productivity per capita.”[2] Thus, Colombia — like many other so-called less developed and developing nations — has a long history with foreign experts and aid.

The content and form of the knowledge transferred in the context of foreign aid and expertise have certainly changed over time. The provision of development economic knowledge has been partly taken over by consultancies such as McKinsey, and the perspective of the private sector on economic development is included. But overall, the tasks and goals of economic experts in countries such as Colombia are very similar today to those formulated in 1950, namely to spur productivity and growth. As such, an end to the practice of transferring and applying economic expertise in less developed countries is not in sight. Of course, this doesn’t mean that nothing has changed in Colombia in the last sixty years, but the persistence of the provision of economic expertise in these contexts makes clear that its institutionalization might have been more successful than its performance. Development economic expertise has many lives, it seems.

Why is this? As I argue, based on the example of the IBRD’s first development programme, the persistence of this practice can be explained, firstly, by the constitution of economic knowledge as universally applicable and as the most relevant for “development”; secondly, by the construction of the notion that certain countries are “underdeveloped,” and, thirdly, by the state-led, top-down approach to “development”.

To be sure, the rise of experts as intermediaries between science and politics had begun long before the 1950s, namely with the increasing “scientification of the social” in the 19th century.[3] Economists as experts gained importance with the economic crisis of the 1930s, through a boost in demand from state leaders.[4] Economics increasingly became modelled on the natural sciences, with its abstract theories and seemingly unambiguous mathematical results, and thus came to be perceived as objective and universally applicable.[5] The use of macroeconomic abstractions such as national income accounting led to the notion that economically successful countries were the norm for productivity and growth rates. Comparisons, and thus the ranking of states, became apparently easy. Economics seemed thereby to offer the appropriate instruments to overcome global differences in income levels.[6] Poor — and thus by definition underdeveloped countries — should and could become like North American and Western European societies — with the help of foreign expertise.[7]

This was the idea in Colombia, too: the IBRD mission proposed setting up a “Resources Planning Office.” Since the authors of the mission’s report identified a lack of Colombian economists and statisticians, they argued that assistance from foreign economic experts was essential.[8] In other words: the experts recommended themselves for “developing” the country, the inhabitants of which were perceived as not yet able to do so alone. Similarly, the country’s workforce had to be re-educated and “modernized,” according to the authors. The report stated that Colombian workers were of “quick and ready intelligence” but that they lacked “strength, capacity and desire to work”; Bad health, unbalanced diet, illiteracy and insufficient training kept productivity low, the authors argued.[9] The experts therefore counted on the country’s small but highly educated and well-trained professional and business class to lead the “development” and realization of Colombia’s potential.[10]

Furthermore, the report called for a “generalized attack throughout the whole economy on education, health, housing, food and productivity”.[11] Since the experts wanted to be pragmatic and make immediate recommendations, they decided — and explicitly stated — that they wouldn’t take into account the role of “race, culture and history”, even though they acknowledged its importance.[12] The underlying notion was, that once economic “development” was achieved, social, political and cultural “development” would follow suit. For the experts, the categories of the economic, the political and the cultural could supposedly be separated, although — of course — they were inseparable in practice, as quickly became apparent in setting up housing programmes and even the construction of an iron and steel mill.

The authors of the report promised that — if Colombia were to follow the recommendations of the development programme — it faced a unique opportunity: Its natural resources could be made productive through the application “of modern techniques and efficient practices”, and technical and financial aid could be obtained from newly established international and foreign national organizations. All that was needed to usher in a period of rapid and widespread development was “the determination of the Colombian people themselves”.[13] Thus, if the recommendations made by the experts weren’t successfully implemented, it most probably would be the fault of the Colombians themselves and the experts couldn’t be held accountable.

The mission recommended an all-encompassing development plan and the simultaneous “development” of the whole economy, arguing that the improvement of one sector alone was not possible because each sector relied on others, which, in turn, depended on improvements in government administration. It became the objective of the state to plan and coordinate development — with the help of experts. Once the economy and the administration were “developed”, the experts claimed, the process of economic development could become self-sustaining and the Colombians would be able to help themselves.[14]

The mission’s approach to “development” was criticized by contemporaries at an early stage. In 1961, the Colombian economist Hernán Echavarría Ológaza proposed one reason for the disappointing outcome of the “development” initiative in his country: “In the Latin American countries there exists an important school which maintains that economic progress must necessarily be directed by the State.”[15] In his eyes, there was no foundation for the claim that “development” should be implemented in a top-down approach, ignoring practical or local knowledge.

Moreover, as soon became clear, the process of comprehensive development planning was depicted as being a lot less complex than it turned out to be. The constitution of economic knowledge as most relevant to “development”, and the desire for a speedy and effective application, masked the complexities and challenges created by the wider context. Simplified conclusions drawn from the experiences of Northern countries, impatience, and the limited focus on what was considered economic knowledge in development planning also meant that they failed to meet expectations.

Of course, since 1950, there have been failures in development, but also success stories, and much has been learnt. The collaboration of the private and public sectors in setting up a new development programme for Colombia in 2007 is just one example that economic development expertise has many lives. We can hope that there will be one life that can live up to the expectations it raises.[16]

Notes

1. The mission consisted of sixteen advisers from different institutions, including the International Monetary Fund, the IBRD and US universities. The head of the mission was an economist, Lauchlin Currie. The other members were specialists in the fields of industry, agriculture, health and infrastructure. Sixteen Colombian advisers from ministries such as the Ministry of Hygiene, the Ministry of Commerce and Industry as well as the Banco de la República assisted the IBRD delegation.
2. It was also dependent from “the distribution of the output of goods and services as between consumers’ and producers’ goods” and “the distribution of income and consumption among the people”. International Bank of Reconstruction and Development (ed.), The Basis of a Development Program for Colombia. Report of a Mission. The Comprehensive Report, Washington, DC 1950, p. ix and p. 20 f. (http://documents.worldbank.org/curated/en/130721468770421467/pdf/multi0page.pdf)
3. Lutz Raphael, (1996): Die Verwissenschaftlichung des Sozialen als methodische und konzeptionelle Herausforderung für eine Sozialgeschichte des 20. Jahrhunderts, in: Geschichte und Gesellschaft 22, pp. 165–193.
4. Mary O. Furner and Barry Supple (1990): Ideas, Institutions, and State in the United States and Britain. An Introduction, in: idem. (eds.), The State and Economic Knowledge: The American and British Experiences, Cambridge, 3–39.
5. Mary S. Morgan and Judy Klein (ed.), The Age of Economic Measurement History of Political Economy, Annual Supplement to Vol. 33, Durham, NC 2001.
6. Daniel Speich, (2011): The Use of Global Abstractions: National Income Accounting in the Period of Imperial Decline, in: The Journal of Global History 6/1, pp. 7–28.
7. See for example Timothy Mitchell, Rule of Experts. Egypt, Techno-Politics, Modernity, Berkeley, 2002 and Joseph Morgan Hodge, Triumph of the Expert. Agrarian Doctrines of Development and the Legacies of British Colonialism, Athens, OH 2007.
8. IBRD, Development Program, p. 586.
9. Ibid., p. 16.
10. Ibid., p. 92.
11. Ibid., p. 355 f.
12. Ibid., p. 11.
13. Ibid., p. 615.
14. Ibid., p. 356.
15. Quoted in Albert O. Hirschman, Ideologies of Economic Development in Latin America [1961], in: idem, A Bias for Hope, New Haven 1971, pp. 270–311, here p. 294.
16. Referring to Frederick Cooper, Writing the History of Development, in: Journal for Modern European History, p. 5–23.

Anna Barbara Sum is a PhD student at Freie Universität Berlin and is currently writing her PhD thesis on Economic Expertise after the Second World War.