INTRODUCTION: DEVELOPMENT AND THE ANTHROPOLOGY OF MODERNITY

There is a sense in which rapid economic progress is impossible without painful adjustments. Ancient
philosophies have to be scrapped; old social institutions have to disintegrate; bonds of caste, creed and
race have to burst; and large numbers of persons who cannot keep up with progress have to have their
expectations of a comfortable life frustrated. Very few communities are willing to pay the full price of
economic progress. — United Nations, Department of Social and Econom ic Affairs, Measures fo r the
Economic Development o f Underdeveloped Countries, 1951

Truman's speech in 1949 was all about fairness for everyone in the world. He talked about how lots of
people were living in really tough conditions, with not enough food, sickness, and not enough money.
Truman thought that people already knew enough to help these problems, so he wanted to share that
knowledge to help other countries have better lives.

He thought it was time for a big change in how the world worked. He wanted all countries to be more like
the advanced ones, with big cities, lots of factories, and fancy technology. Truman believed that money,
science, and technology could make this happen, so everyone could have peace and plenty.

But it wasn't easy. Truman knew there were big challenges ahead. He talked about how some old ways of
thinking and doing things would have to change for progress to happen. Even though this idea might seem
a bit selfish or narrow-minded, a lot of powerful people liked it and wanted to make it happen. So they
started trying to completely change the way underdeveloped countries worked.

For a long time, from the 1950s to the late 1970s, everyone talked about how to help countries get better.
Even if they disagreed on how to do it, they all agreed that development was the key. It was the big topic
in global conversations, and it shaped a lot of the decisions made by governments and organizations.

But by the 1980s, people started looking at development differently. They started asking questions about
who had power and who didn't in these conversations. Influenced by smart thinkers like Foucault, they
saw how certain ideas became more important than others and how that affected what people did.
Anthropologists also started thinking about how culture played a big role in development and how it
affected people's lives.

This book wants to dig into development as a big idea. It wants to show how it changed the world and
what problems it brought with it. It looks at how the idea of the "Third World" was made and how power
worked in shaping it. And it asks important questions about whether there are better ways to help people
and what those might be.

D e c o n s t r u c t in g D e v e l o p m e n t

In the late 1980s, people started to really think hard about how we talk about development - you know,
making places better and helping folks out. This thinking continued into the 1990s, with folks trying to
come up with different ways to talk about it and do it. Not many folks were taking apart this way of talking
about development until James Ferguson wrote a book about what was happening in Lesotho, a country
in Africa. He looked at how the World Bank tried to help there but ended up making things worse in some
ways, like making the government stronger and changing how people related to each other.

Another person, Sachs, looked at all the big words we use when we talk about development - like market,
planning, and poverty - and how they've changed over time. He wanted to show that these words aren't
always helpful and can even cause problems, especially in places like the Third World. Some folks got
together to say, "Hey, maybe there are other ways of thinking about development that aren't just from
the West." They wanted to give non-Western ideas a chance to shine.

Then there's the topic of women and development. In the late 1970s and 1980s, people started realizing
that development programs were leaving women out. Feminist researchers looked into this and found
that big development groups were treating women like they didn't matter much. They also studied how
this affected other areas, like economics and the environment.

Swedish researchers looked at how different places around the world understand and do development
stuff. They found that local customs, histories, and the global economy all play a role in how development
happens. This helps us see that development isn't the same everywhere.

Some folks also looked at how subjects like political science and sociology have shaped how we think
about development. They found that sometimes these subjects have made things worse by ignoring local
cultures and just focusing on big ideas.

Overall, all these studies help us see that there are lots of ways to think about development. They
challenge the old ideas and help us imagine new ways of helping people and making the world better. It's
like they're saying, "Let's try something different and see if it works better."

Anthropology and theDevelopmentEncounter

In his book "Anthropology and the Colonial Encounter" back in 1973, Talal Asad asked why many
anthropologists didn't really think about the power balance of colonialism, which heavily influenced their
field. He wondered if today's development projects create a similar situation where one side has more
say, even though people might seem to have more voice. Is development still keeping unequal
relationships, just like during colonial times? Can we even put "anthropology and the development
encounter" in the same discussion?

It's true that anthropology hasn't fully figured out how it fits into the post-World War II development
world, even though some anthropologists have disagreed with development efforts. Many have worked
for groups like the World Bank and USAID. Some have been right in the middle of development work,
while others have stood outside, supporting indigenous peoples. But they've missed how development
shapes cultures and identities.

Anthropologists should talk more about development as a way we see and understand things, just like
they've done with colonialism. Development still hugely affects how we view the Third World, maybe even
more than colonialism did. But many Western scholars overlook how American power influences
development in many ways. Third World thinkers are increasingly saying we need to get rid of the whole
idea of development.

Overviewof theBook

Chapter 3 talks about how development became a big deal after World War II. It explains how people
started seeing poverty as a major problem and how development became the solution. The chapter looks
at how development was set up, with experts and organizations getting involved. It tries to understand
how development works, what its basic ideas are, and how it affects places like Third World countries.

Chapter 4 looks at development from a different angle. It's like taking a closer look at how money and
economics play into development. It explains how economists came up with ideas about the
"underdeveloped economy" and how they planned to fix it. Even though some people think there could
be better ways to think about economics, most economists haven't changed their minds much. The
chapter also talks about a new idea called "communities of modellers" that could help us understand
economics better.

Chapters 4 and 5 give us more details about how development actually happens. They show us how
experts use their knowledge and power to deal with big problems like hunger. It looks at how these plans
were carried out in countries like Colombia. Chapter 5 goes deeper into how groups like the World Bank
think about peasants, women, and the environment. It shows us how their ideas affect things like rural
development and gender equality.
The last chapter is about what we can do instead of just sticking with the same old development ideas. It
talks about how some people are saying we need to rethink development altogether. It looks at research
about "hybrid cultures" in Latin America and suggests that we focus on finding new ways of doing things
instead of just copying old models. The chapter talks about the struggles over things like nature and
culture, especially in places with diverse ecosystems. It says we need new stories and ideas to imagine
different futures.

Chapter 2

THE PROBLEMATIZATION OF POVERTY: THE TALE OF THREE WORLDS AND DEVELOPMENT

The word "poverty” is, no doubt, a key word of our times, extensively used and abused by everyone.
Huge amounts of money are spent in the name of the poor. Thousands of books and expert advice
continue to offer solutions to their problems. Strangely enough, however, nobody, including the
proposed "beneficiaries” of these activities, seems to have a clear, and commonly shared, view of
poverty. For one reason, almost all the definitions given to the word are woven around the concept of
“lack” or “deficiency.” This notion reflects only the basic relativity of the concept. W hat is necessary and
to whom? And who is qualified to define all that?” — Majid Rahnema, Global Poverty: A Pauperizing
Myth, 1991

One big change after World War II was the focus on poverty in Asia, Africa, and Latin America. People
suddenly realized that millions were living in terrible conditions. This discovery led to a global effort to
fight poverty, with the United States leading the charge. The idea was that if one part of the world
suffered, it affected everyone. Poverty wasn't just seen as a local problem anymore; it became an
international concern.

Before World War II, poverty was viewed differently. In colonial times, people thought there wasn't much
they could do to help the poor. But things changed as capitalism spread. Poverty became a big issue, and
governments started trying to fix it. They created new ways to help the poor and control their lives. This
marked the beginning of what we now call "social" problems like poverty, health, and education.

Development, which became a big deal after the war, continued this trend. Poor countries were now seen
as lacking what richer countries had. The World Bank even set a standard for poverty based on income.
The solution to poverty? Economic growth and development. This idea became widely accepted, shaping
how we think about poverty and how we try to solve it.

This chapter looks at how poverty became such a big deal and how it shaped the world. It's not just about
helping the poor; it's also about power and control. The narrative of "three worlds" — the First World,
Second World, and Third World — became a way to order the world and justify certain actions. But now,
people in the Third World are challenging this narrative and demanding change.

T h e I n v e n t io n o f D e v e l o p m e n t

The Emergence o f the New Strategy

From July 11 to November 5, 1949, Colombia got a visit from a special group - an economic team sent by
the International Bank for Reconstruction and Development. It was a big deal because it was the first time
such a team was sent to a country still developing. Their job? To figure out how to make Colombia grow
and improve.
The mission had a big goal: to make a detailed plan to solve Colombia's economic and social problems.
They thought the key was to work on every part of the economy together, like education, health, housing,
and productivity.

The report they made showed they were eager and hopeful. They believed Colombia could change for the
better with good planning and hard work. They thought Colombia's natural resources were a big
advantage and, with modern techniques and help from other countries, Colombia could become a model
for other developing nations.

But, there was a bit of a bossy tone in the mission's approach. They thought only their way of developing
could save Colombia. Even though they talked about helping, their plan was really about taking control
and making Colombia fit Western ideas of progress.

So, the visit in 1949 marked the start of a new way of thinking about development in Colombia, where
Western ideas became the standard.

Precursors and Antecedents o f the Development Discourse

In the next part, we'll talk about how the idea of development, like what the World Bank did in Colombia
in 1949, came at a time when big changes were happening in history. These changes shifted how Europe,
the United States, and most countries in Asia, Africa, and Latin America related to each other. It also
changed how Western culture saw these regions. But before this idea of development became
widespread, there were early signs that it was coming.

For example, in Africa, when colonialism declined, the idea of development started to rise, especially in
the period between the two world wars. The British Development Act of the 1940s was one of the first
big steps toward development. It was a way for the British Empire to stay strong in the face of challenges
in the 1930s. In places like southern Africa, efforts to make the population more modern often meant
giving up local traditions, like traditional ways of growing food and community life.

Latin America had a different experience because it became politically independent earlier. But signs that
development was on the way were still there. By the early 1900s, the United States was becoming
influential in the region. Sometimes it acted as a helpful neighbor, but other times it used its power to get
what it wanted. This caused tensions between the United States and Latin American countries, which
wanted to develop their economies and societies in their own way.

Meetings between North and South American countries in the middle of the 20th century showed these
tensions. The looming Cold War made things even more complicated. While the United States focused on
military stuff, Latin American countries wanted to focus on growing their economies and making life better
for their people. This difference in goals ended the idea of being good neighbors. Even though the United
States wanted everyone to follow free-market ideas, Latin American countries fought for their industries
and social programs.

After World War II, the world changed a lot, especially for countries that weren't as rich. The idea of
development became really important. It changed how people thought about culture, society, money,
and politics all over the world. In the next part, we'll dig into the reasons why development became such
a big deal and look at how people talked about it, to understand better who had power and who didn't in
this new world.

H is t o r ic a l C o n d it io n s , 1945-1955

After World War II, the world went through some big changes, especially in how different parts of the
globe were seen and treated. Before the war, countries that weren't as developed were mostly valued for
their strategic importance and the resources they had. But after the war, things got more complicated.
Talks at the United Nations and other meetings focused a lot on what should happen to these non-
industrialized parts of the world. Terms like "underdevelopment" and "Third World" came into use during
this time, shaping how people thought about the world.

By the early 1950s, the idea of three worlds had taken hold: the rich industrialized nations, the Communist
ones, and the poor, non-industrialized ones. Even though the Cold War changed some things, the idea of
First, Second, and Third worlds continued to shape how we see the world today.

For the United States, the main goal was rebuilding Europe after the war. This meant supporting European
countries' control over their colonies because their resources were crucial for recovery. The US also
wanted to have more influence over these resources, especially oil in the Middle East. In Latin America,
the US faced growing nationalism. Many countries there started to build their own economies, often with
government support. Democracy was also becoming more important, with more people, especially the
working class, wanting to have a say in how their countries were run. However, the US didn't fully
understand this changing situation.

Aside from these struggles for independence and nationalism, other things influenced the idea of
development. The Cold War was a big factor, as was the need to find new markets for goods. People were
also worried about communism and too many people in the world. But there was also a strong belief in
the power of science and technology to solve these problems.

Finding New Markets and Safe Battlefields

In 1939, there was a big meeting called the Inter-American Conference where countries in the Americas
agreed to stay neutral in wars. The United States realized that to keep this unity, they needed to help out
Latin American countries financially. So, they set up something called the Inter-American Development
Commission in 1940. During the war, they gave some money to Latin America to help with making
important stuff like materials needed for the war.

Then, in 1945, things changed a lot. The United States became the strongest country both economically
and militarily. From 1945 to 1955, the U.S. got even more powerful because they wanted to expand their
markets and invest in Europe, especially after the war. They did this through a big plan called the Marshall
Plan, where they gave a lot of money to Western Europe to help them recover. This was different from
usual because they cared more about helping everyone than just making money.

But the help given to poorer countries, known as the Third World, was much less. Latin America got only
a small amount of help compared to Europe. The plans for development in these countries were often
about serving the interests of rich capitalists, trying to stop people from wanting independence and
controlling left-wing movements. Then, the Cold War started, and this made the development plans even
more important as both the U.S. and the Soviet Union wanted to show off their power.

There were also military alliances made at big meetings like the Rio conference in 1947, and these were
closely connected to plans for development. The Third World became a place where big countries
competed for power, which led to a lot of conflicts and problems.

People were also scared of communism spreading to poor countries, so they thought it was really
important to help these countries develop. This fear of communism influenced how governments,
schools, and everyone else talked about development.

So, after World War II, a lot of things changed. The powerful countries were trying to be even more
powerful, and they used development as a way to do that.
 T H E PR O BL EM A TIZ A T IO N O F PO V ERTY 35 Poor and Ignorant Masses

The push to combat poverty gained momentum with a heightened concern over population growth. This
concern led to a surge in discussions and positions on population issues, often influenced by Malthusian
views. Economists and demographers worked to understand how demographic factors impacted
development, forming models and theories to guide policies.

Population had been a topic of interest for some time, especially in relation to Asia and discussions on
race. However, the scale and depth of these discussions expanded significantly. Academic and
international forums delved into topics like the relationship between population growth and economic
development, the impact of culture on birth control, and trends in fertility and mortality.

These discussions, while still grappling with racist views, increasingly took on a scientific tone, integrating
insights from demography, public health, and population biology. This shift toward a more scientific
understanding of population dynamics laid the groundwork for new approaches to managing population
growth.

The Promise o f Science and Technology

After World War II, many people were really excited about how science and technology could make the
world a better place. They saw how things like nuclear physics and operations research had advanced
during the war, and they believed these could be used for good. In 1948, a famous person from the United
Nations said that human progress depended on using science and natural resources wisely.

This trust in science and tech changed the way people talked about making countries better. By 1949,
after seeing the success of programs like the Marshall Plan in Europe, attention turned to helping places
that were still struggling, like Latin America. They came up with programs like the Point Four Program,
which aimed to bring modern technology and money to these places to help them improve.

People thought technology wasn't just helpful but also really important for making progress. They thought
it could bring new ideas and results. But they didn't realize that technology could also change how
societies and cultures worked.

As the Third World became more important in the world economy, people wanted to understand it better,
especially Latin America. Scholars realized they needed to learn more about these places, so they started
studying them more closely using things like sociology and economics.

This change in how people studied the world also changed how they thought about helping it develop.
They realized they needed to focus on the specific problems of each place to really help them get better.
They thought that making the economy grow was the key to helping people out of poverty.

And they also saw that sometimes, the government needed to step in to help development. They learned
this from things like the New Deal in the United States and regional development corporations.

So, all these things together shaped a new way of thinking about development. It was based on believing
in the power of science and technology, understanding each place's problems, and knowing that
sometimes, the government needed to help. But behind all this hope, there were also new ways that
powerful people controlled what happened, which affected the lives of people in poorer countries a lot.
 T h e D is c o u r s e o f D e v e l o p m e n t

The Space o f Development

Understanding development as a discourse means realizing it's like a conversation that shapes how we
think about making societies better. Back in the 1940s and 1950s, the big idea was modernization, which
meant making countries more like modern cities. People believed that to do this, you needed to build
factories and cities, and that needed a lot of money. But many countries didn't have enough money, so
they thought they needed help from other countries and big organizations like the World Bank.

So, what were the main things people talked about when it came to development back then? They talked
about saving money, using new technology, having enough people, and using resources wisely. They also
talked about teaching people new things and making sure everyone had the same modern values.
Organizations like the World Bank and governments had a big say in how things were done.

But it wasn't just about these ideas on their own. It was also about how they fit together and who got to
talk about them. Some people, like experts and powerful countries, had more say than others.

The ideas of development focused on solving specific problems, like poverty and how to grow food better.
But not everyone got to say what the problems were or how to fix them. Big organizations and experts
often had the final say.

As time went on, the ideas about development changed, but the way people talked about it stayed the
same. Even if ideas seemed different, they still fit into the same conversation about making things better.
Other things, like communism and ideas about men being more important than women, also played a big
role in how development happened.

Development is still happening today, but it often forgets about the people it's supposed to help. It's
criticized for not listening to local cultures and for thinking that one solution fits everyone, even when it
doesn't.

The Professionalization and Institutionalization of Development

Understanding development as a historical construct means seeing it as a response to the problem of

poverty after World War II, rather than a natural process of problem-solving. Development, therefore, is
a product of history, shaped by mechanisms of knowledge and power. Professionalization played a key
role in this process, bringing Third World countries into the realm of Western expertise through the
creation of development sciences and disciplines.

This professionalization shifted the focus of development issues from political and cultural realms to
scientific ones. It led to the establishment of development studies programs and the reorganization of
knowledge institutions, both in the developed and developing world. The influx of experts into Third
World countries led to a massive gathering of data and the formulation of policies based on this
knowledge, often with significant normalization effects.

Moreover, the professionalization of development resulted in the translation of Third World people and
their interests into data framed within Western capitalist paradigms. This process often led to the
reinterpretation and recontextualization of local history, culture, and practices through Western lenses,
reinforcing ideological biases.

The institutionalization of development created a network of power that binds people and communities
to specific cycles of cultural and economic production. This network operates through various levels of
institutions, from international organizations to local development agencies, disseminating knowledge
and promoting certain behaviors and rationalities.
The knowledge produced about the Third World is utilized and circulated by these institutions through
various means, including applied programs, conferences, and consultant services. This has led to the
establishment of a thriving development industry, with poverty alleviation becoming a lucrative business
for planners, experts, and civil servants.

However, the success of development in managing and controlling countries and populations contrasts
sharply with its failure to solve the basic problems of underdevelopment. The gap between
institutionalized development and the realities faced by popular groups in the Third World continues to
widen, highlighting the discord between development discourse and grassroots experiences.

T h e I n v e n t io n o f “T h e V il l a g e ”

DevelopmentattheLocalLevel

James Ferguson (1990) talks about how development books make Third World countries seem "less
developed," just like how Colombia was seen as underdeveloped by the World Bank in 1949. This idea
makes places like Lesotho look cut off from the world, with most people as farmers doing things the old
way. These ideas, like "less developed country," keep popping up and affect how we see and help these
places.

Mitchell (1991) adds that these ideas make us think about development as limited by nature and space.
The talk about development sounds smart and reasonable, blaming the problems in non-Western
countries on not having Western knowledge and tech, but it ignores power and fairness.

At the local level, ideas about development spread in tricky ways, changing how communities see
themselves and act. Pigg's (1992) study in Nepal shows how talking about development changes local
culture, making it kind of Nepalese, but with new development ideas mixed in. In Papua New Guinea,
people talk about "kamap" (coming up), mixing old beliefs with new ideas about getting ahead.

In Lamu, Kenya, women are figuring out what development and being modern mean, mixing Western
ideas with Islamic and other influences from richer countries. In rural Colombia, Afro-Colombian farmers
learn new farming ways alongside their old beliefs.

These stories show how development ideas affect local life, mixing with old traditions. To really
understand this mix, we need to study it closely without just accepting what development experts say.

C o n c l u s io n

The pivotal shift in the post-World War II era wasn't some big breakthrough in thinking or politics but
rather a reorganization of factors that brought the Third World into a new spotlight. Underdevelopment
became a target for political actions meant to erase it, but instead, it seemed to multiply endlessly.

Development started seeing social issues as technical problems, to be solved by a group of experts called
development professionals. Instead of understanding each society's history and culture, they tried to fit
them into a model of modernity, like a sorcerer's apprentice creating unintended consequences.

For many Third World countries, development became so important that their leaders allowed all sorts of
interventions and controls, even if it meant impoverishing their people, selling off resources, or harming
the environment. People began to doubt their own cultures and believe in progress, even if the promises
of development seemed impossible to fulfill.

Even after decades, the way we understand and represent the Third World is still shaped by the same
ideas. Development's power doesn't come from repression but from making its ideas seem normal,
controlling what we know, and bureaucratizing social action. It's a real historical force built around the
idea of underdevelopment, and challenging it means thinking about Third World conditions in new ways.
Sure, there's real economic exploitation to deal with, and living conditions are a big concern. But focusing
on development has made us forget the real material conditions people face. Understanding how Western
knowledge and power have shaped the Third World can help us see things differently.

The success of development lies in how it constructs the poor and underdeveloped as universal subjects,
erasing their diversity and complexity. It relies on the idea that the Third World is different and inferior,
perpetuating discrimination. Terms like "poverty" and "underdevelopment" are fixed in our minds, thanks
in part to economists. They'll be the focus of the next chapter.

ECONOMICS AND THE SPACE OF DEVELOPMENT: TALES OF GROWTH AND CAPITAL

All types of societies are limited by economic factors. Nineteenth century civilization alone was
economic in a different and distinctive sense, for it chose to base itself in a motive rarely acknowledged
as valid in the history of human societies, and certainly never before raised to the level of a justification
of action and behavior in everyday life, namely, gain. The self-regulating market system was uniquely
derived from this principle. The mechanism which the motive of gain set in motion was comparable in
effectiveness only to the most violent outburst of religious fervor in history. Within a generation the
whole human world was subjected to its undiluted influence. — Karl Polanyi, The Great Transformation,
1944

T h e A r r iv a l o f D e v e l o p m e n t E c o n o m ic s

L a u c h l in C u r r i e , a former Harvard economist and official in the Roosevelt administration, evoked

in the following way, at a testimonial dinner party in Bogota in 1979, the first World Bank mission, which
thirty years earlier had taken him to that same country: I don’t know where in my conservative Canadian
background I acquired a reformer’s zeal, but I must admit that I had it. I just happen to be one of those
tiresome people who can’t encounter a problem without wanting to do something about it. So you can
imagine how Colombia affected me. Such a marvelous number of practically insoluble problems! Truly
an economic missionary s paradise. I had no idea before I came what the problems were but that did not
dull for a moment my enthusiasm nor shake my conviction that if only the Bank ano the country would
listen to me I could come up with a solution of sorts to most. I had my baptism of fire in the Great
Depression. I had played some role in working out the economic recovery program in the New Deal for
the worst depression the United States had ever experienced. I had been very active in government
during the Second World War. (Quoted in M eier 1984, 130)

This reflection tells us about some important traits in how North Americans approached projects in
colonies and after they gained independence. They had a strong desire to make things better and educate
people, and they believed they could solve any problem, no matter how big. People like Currie, an
economist, shared these traits. They were inspired by the recovery after the Great Depression and the
ideas of John Maynard Keynes, an economist who believed in government intervention in the economy.

When Currie went to Colombia in 1949, there wasn't a specific branch of economics focused on
development. He tried to use different parts of economics to understand Colombia's problems and
gathered experts to help. But this way of looking at Colombia, through economic theories, made it seem
simpler than it really was.

Since there weren't specific theories about how poor countries could develop in Currie's time, many new
ideas emerged in the 1950s. People became very interested in poverty and development, and big
organizations like the Ford and Rockefeller foundations gave a lot of money to study these issues. But by
the 1980s, some of the people who started this field said it wasn't working anymore. This happened
because the world was changing, with more focus on free-market ideas and big changes in how poor
countries were managed.
Development economics promised different ways to make poor countries richer, from directly helping
their economies to more market-friendly approaches. This chapter looks at how these ideas fit into the
bigger picture of how people think about economics. It suggests we need to understand not just the
numbers, but also the culture and history behind economic ideas. And maybe we need to change how we
talk about economics to find better solutions for everyone.

E c o n o m ic s a s C u l t u r e

Economists usually see their work as showing the world how it really is, not as part of a cultural
conversation. They think their knowledge is just the truth, without any cultural influence. But actually,
economics is deeply connected to culture.

The way we understand economics has been shaped by our history over many years. This understanding
is key to how we see modern economics. It's all about separating different parts of life into categories,
like economy, politics, and society. This separation led to the rise of political economy, a way of thinking
that explained how capitalism works. This way of thinking about the economy has become a big part of
our everyday lives.

Power also had a big impact on how the economy developed. When markets became more important in
the 18th and 19th centuries, people had to change how they lived and worked. They had to become
disciplined workers, and rules were made to control them and make sure they fit into the new economic
system. This made people act in a certain way, like working hard to make money.

Another big change was how people saw the economy. It became its own separate thing, not just part of
society. This shift made production and labor the most important things in society. Even Karl Marx, who
criticized the way we think about the economy, still used the same ideas, making them even more
common.

But there's more to the story than just economics. There's a whole cultural side to it too. Economics
shapes our view of the economy, but it also pushes aside other ways of thinking about it. This means that
some voices and ideas get left out, creating a kind of cultural bias within economics.

Looking at economics as part of culture means asking where these ideas came from and how they affect
our culture. It's not just about analyzing the words economists use; it's about understanding the bigger
cultural forces behind them. By doing this, we can get a better, more complete picture of how economics
really works in our world.

T h e W o r l d o f E c o n o m ic s a n d t h e E c o n o m ic s o f t h e W o r l d .

T h e o r e t ic a l a n d P r a c t ic a l A n t e c e d e n t s o f D e v e l o p m e n t E c o n o m ic s.

"The Static Interlude" and the World o f Economics

In 1954, W. Arthur Lewis penned a notable article titled "Economic Development with Unlimited Supplies
of Labour." He embraced the classical tradition, which viewed labor as abundant and production as driven
by capital accumulation. This tradition, spanning from Adam Smith to Karl Marx, focused on the
distribution of income and capital growth, considering natural resources and institutions as constant.

Classical economists believed in the limited nature of natural resources, leading to concerns about
progressive impoverishment and a stationary economy. They thought technical progress was necessary
to offset these limitations. For Ricardo, profit levels determined capital accumulation and economic
growth, and his theory of value centered on labor.

However, the "marginal revolution" of the 1870s introduced a new theory of value based on utility rather
than labor. This shift laid the foundation for neoclassical economics, which emphasized perfect
competition and rationality. Neoclassical theory envisioned a harmonious, self-regulating economic
system driven by individual optimization and market equilibrium.

Neoclassical economics relegated questions of distribution, class, and historical context to the sidelines,
focusing instead on optimizing resource allocation within static equilibriums. Despite its rejection of the
labor theory of value, neoclassical economics retained many elements of the classical tradition,
maintaining a focus on market conditions and individual satisfaction.

The neoclassical worldview, characterized by perfect competition and rationality, reflected a belief in an
orderly, self-optimizing economic system. However, the upheavals of the 20th century, including World
War I and the Great Depression, challenged this optimism and spurred renewed interest in economic
growth.

These historical events set the stage for the emergence of development economics as scholars grappled
with the complexities of achieving growth and prosperity in a rapidly changing world.

“The Years o f High Theory” and the Economics o f the World

The way people thought about economics changed a lot starting with the marginalist revolution. At the
same time, the world was going through some big economic problems. Between the two World Wars,
things were shifting. The line between the government and the economy wasn't as clear anymore, and
new rules were being made. Keynesianism and growth economics helped people understand and explain
these changes. They also laid the groundwork for a new way of thinking about how economies develop.

Karl Polanyi talked about how the idea of a self-regulating market wasn't working anymore. The First
World War brought new ways of running things, blurring the line between what the government did and
what businesses did. There were also new ideas about how to make businesses more efficient, like
Taylorism and Fordism, even though some workers didn't like them.

The Great Depression showed that the old way of thinking about the economy wasn't right. Keynesian
economics said that the government needed to spend money to get people back to work. This was
different from what neoclassical economics said. Growth economics looked at how investing in things
could make the economy grow.

The United States became more important in the world economy, and this changed things for other
countries, like in Latin America. They started trading more with the U.S. and started making more of their
own stuff instead of buying it from other countries. Governments had to step in to help their economies
grow.

After World War II, the U.S. became even more powerful. They set up organizations like the International
Monetary Fund and the World Bank to help countries work together. People started to think more about
how to help poor countries develop.

Early development economists wanted to make things better for everyone. They were influenced by what
happened during the Great Depression and when countries became independent from their colonial
rulers. They believed in using government policies to help people. Their ideas are still important today.

T h e D e v e l o p m e n t o f D e v e l o p m e n t E c o n o m ic s

The Early Theories: Structuring the Discourse

Between 1948 and 1958, a new field called development economics started to take shape. It focused on
figuring out how to help countries that were struggling economically. This was a time when people began
to talk specifically about "underdeveloped economies" and how to improve them.
Before this, when people talked about "development," they usually meant things naturally getting better
over time. But after World War II, especially during the Great Depression, folks started seeing growth as
a way to fight poverty and unemployment.

Development economics at that time had some key ideas: saving up money, building up industries on
purpose, making plans for development, and getting help from outside. They thought building up
industries was super important because it made countries more modern and better at making stuff, plus
it helped them compete in trade.

They used ideas from older theories about how economies grow, like saving money and investing it wisely.
But they ran into problems trying to apply these theories to countries that were still developing. These
countries faced challenges like bad trade deals, not enough technology, and not enough money saved up.

Some smart people came up with different models to tackle these challenges. For example, Rosenstein-
Rodan thought that countries needed big investments in industries all at once to get them going. Others,
like Rostow and Nurkse, had their own ideas about how countries could grow and escape poverty.

Nurkse's idea was especially interesting because it showed how poverty and underdevelopment were
connected. He thought that if you boosted different parts of the economy at the same time, you could
create a cycle of growth and help everyone get better off.

So, those years between 1948 and 1958 were a big deal for development economics. They set the stage
for more ideas and strategies to help struggling countries grow and prosper.

Nurkse had a different view on how struggling economies could gather money. He didn't just blame low
savings; he also said there wasn't enough encouragement for people to invest their money. He liked
Schumpeter's ideas but didn't focus much on private entrepreneurs like Schumpeter did. Western
economists didn't pay attention to Schumpeter's theories because they thought they were mostly about
business cycles, not about developing countries. Plus, they didn't think poor countries had many
entrepreneurs.

Nurkse's ideas could have helped early development economists because he was interested in big
changes, just like them. But if they used Schumpeter's theories, they would have had to deal with some
tough questions that most economists of that time didn't want to tackle, like the idea that just growing
wasn't enough for development.

Another important idea came from W. Arthur Lewis in 1954. He said a country's economy could be split
into two parts: one modern and one traditional. Lewis thought development meant making the modern
part bigger and the traditional part smaller. This idea became really popular among economists and
organizations for a long time. But it had some problems. It made traditional parts seem old-fashioned and
not worth investing in. It also made a big gap between the modern and traditional parts, making the
traditional side seem like it was from a different time.

This way of thinking ignored the real lives of people in traditional areas. Lewis talked about moving rural
workers to modern industries without thinking much about how they felt about it. He only focused on the
rich people and didn't think about the majority who couldn't save much money. He thought if the rich got
richer, they would save more money, and somehow that would lead to development.

In short, Nurkse and Lewis had some important ideas about developing economies, but their theories
didn't think about all the complex problems in those countries or the views of the people who lived there.

In the mid-1900s, economists started thinking more about how to help poorer countries grow. But by the
early 1970s, they realized that some of their ideas weren't working as well as they'd hoped. Albert
Fishlow's research showed that even though countries like Brazil were growing fast, the gap between rich
and poor was getting wider. Instead of creating more jobs and making life better for everyone, these
growth models actually left a lot of people poorer and without work.

In Latin America, a group of economists at the Economic Commission for Latin America (CEPAL) had a
different approach. They noticed that poorer countries were losing out in trade deals with richer
countries. They thought this was because the poorer countries weren't as productive, so they couldn't
save enough money to grow. They suggested a plan called "import substitution industrialization" to help
poorer countries make more of their own stuff and rely less on imports. But this plan didn't always work
well and sometimes made things worse by causing more problems like inflation.

In the 1960s, Marxist and neo-Marxist theories became popular. These ideas criticized the way rich
countries were helping poor ones develop. They said that Western capitalism wasn't doing enough to help
poorer countries grow. They called for big changes to the system and for poorer countries to work
together to improve their situations. But these ideas were also hard to put into practice and didn't always
fit in with what most economists thought.

Cheryl Payer looked at these early development models from a modern perspective and saw how they
laid the groundwork for a big problem: the debt crisis. These models assumed that poor countries could
easily borrow money to help them grow. But they didn't think about how these countries would pay back
the loans, especially considering their different situations compared to richer countries in the past. This
led to a lot of poor countries getting into debt they couldn't handle, causing even more problems down
the line.

In short, early development economics aimed at increasing savings, investment, and productivity to spur
growth. However, it overlooked the broader social, cultural, and political aspects of development. Instead,
it saw underdevelopment as a simple problem to fix with technology and economic tools, ignoring other
perspectives and broader social changes.

The rise of development economics wasn't just about new theories. It was also a response to the needs
of the post-World War II era, which demanded fresh economic ideas and methods to manage societies.
This led to the growth of Keynesian and growth economics and the introduction of planning.

Development economics helped interpret historical events through an economic lens, shaping policies
and global negotiations. Economists gained influence in guiding development efforts, deciding how
resources were used and policies were made. Meanwhile, institutions supporting this economic approach,
like planning bodies and economic faculties, became more established.

Looking ahead, studying planning in more detail will reveal how development economics influenced global
development strategies.

Managing Social Change: The Constitution of Development Planning

In the 1960s, people really liked economic growth theories. They thought that making economies bigger
was the same as making them better. This idea was so popular that countries like England and France
started making plans to grow their economies. Planning wasn't just about talking; it became a way to
connect economic ideas with government policies. The people who studied economics told everyone
what to do, and the planners made it happen in real life.

The first time the World Bank lent money to a poor country, Chile, things didn't go as planned. The project
looked good on paper, but in reality, it was a mess. This showed that Latin American experts and officials
needed help learning how to turn ideas into action. It taught us that having skilled people who can manage
big changes is super important.
Colombia also started planning big changes, setting up lots of planning groups. But in the 1950s, they
faced problems because of social and political issues. They had to bring in experts from other countries to
help them make good plans. This showed that Colombia needed to train its own people to lead the way.

Countries often got help from outside to design and plan their projects. For example, the World Bank
helped create the Autonomous Regional Development Corporation of the Cauca Valley in Colombia. This
showed how international groups influenced local development plans.

During this time, development economics and planning became really important. They replaced the old
ways of thinking about economics with new ideas and research. People started seeing poverty and
underdevelopment as problems to solve with better jobs and more production. They set up lots of
planning groups at different levels to tackle these issues. They tried to include everyone in the
development process, but it wasn't always successful.

S h if t i n g E c o n o m ic D i s c o u r s e : L o c a l M o d e l s a n d t h e G l o b a l E c o n o m y.

The 1980s: The Lost Decade and the Return to Realism.

In the 1960s and beyond, development economics changed a lot. At first, people mainly cared about
making economies grow, without thinking too much about whether it was really helping people. But as
time went on, new ideas came up, like ways to grow and share the wealth, boosting exports, and
controlling money internationally. These ideas brought changes, but the basic ideas about how economies
work stayed the same.

The 1980s were tough for many parts of the world, especially Asia, Africa, and Latin America. This time is
often called the "lost decade." Latin America had a hard time with debt, and people's lives got harder
because of cuts to government spending and protests. This made economists look hard at what they had
been doing.

During the 1980s, top economists looked back at what they had been doing and saw both good and bad.
Some progress was made in understanding how economies work, but they realized they hadn't thought
enough about the real lives of people. Critics like Raul Prebisch and P. T. Bauer said that big economic
ideas didn't always help poor countries because they didn't think about the social and historical stuff that
mattered.

Neoliberal economics, which is all about letting the market decide, got really popular in the 1980s.
Governments started selling off public things and making big changes, following what groups like the IMF
and the World Bank said. This changed how many countries ran their economies, moving away from
helping everyone and more towards letting businesses do what they want.

Even though some people tried to come up with new ideas, like neo-structuralism, neoliberalism became
the norm in places like Latin America. By the 1990s, most countries were following market-focused
policies and joining in with globalization.

But even with all this talk, development economics didn't really change much. People were still saying it
needed to look at things like society and culture more. Some new ideas from fields like anthropology and
political economy might help with that, though.

The Cultural Politics of Economic Discourse: Local Models in Global Contexts.

Development economics isn't just about one-size-fits-all ideas; it's shaped by the culture and power
dynamics of different places. Experts in history and anthropology have looked at various economic
models, but they often get stuck seeing things only through the lens of big economic theories. These
theories usually ignore how regular folks push back against capitalist ways of doing things and instead
focus on fitting those ways into their models.
One way to understand how people see their own economies is to look at how they resist capitalism. For
example, in Colombia, some farmers fought hard against capitalist farming methods because they thought
they were bad for the land. Similar fights have happened in other places too, showing how power
influences how people do economics.

Anthropologists like Gudeman and Rivera came up with the idea of "local models." These are ways of
thinking about money and stuff that come from talking with each other in communities and comparing
ideas with the big economic theories. For instance, in the Colombian mountains, farmers think about
money and stuff based on sharing with the land and making the family home the center of everything.
This way of thinking keeps changing as people try out new ideas and mix them with the old ones.

In Latin America, there's a new way of doing business that mixes different economic ideas together.
Gudeman and Rivera call it the "house business." It's all about blending different ways of making money
in a way that's always changing and bringing in different cultures. This shows that there's no one right way
to do economics and that we need to pay attention to how people see things where they live.

To really change how we think about development economics, we have to listen to these local ways of
thinking and include them in our big conversations. This means we have to deal with the unfairness of
who has power and rethink how we share power around the world when we talk about money. It's a tricky
thing to do, but it's super important if we want to make development better for everyone.

When we talk about development and economics, there are two important things we need to think about.
First, we have to understand that different communities have their own ways of thinking about and doing
economics. This means that how people use money and resources can vary a lot depending on where they
live and what their culture is like. But it's not just about knowing these local ideas – we also need to
understand the big forces that shape and control them.

One way to understand these forces is through something called political economy. This looks at how
power and money work together on a large scale. Traditional ideas about political economy have focused
on things like unfair trade and imperialism, but they often don't pay enough attention to how local
cultures affect the global economy. We need a new kind of political economy that looks at how global
economic forces are influenced by local cultures and practices.

For example, when global capitalism tries to spread into new areas, local communities often resist by
sticking to their own economic ways. This resistance creates something called "cultural difference," which
is shaped by both local and global influences. Understanding how these influences interact can help us
see how capitalism relies on diversity to keep growing and changing.

But it's not just about understanding how things are – it's also about imagining how they could be
different. Some economists, like Samir Amin, have come up with alternative ideas for development that
focus more on local control over resources and markets. While these ideas have some limits, they can still
help us think about how to make economics more fair and sustainable.

In the end, what we really need is a new way of doing economics that takes both local knowledge and
global influences into account. This means challenging the old ideas that dominate economics and making
sure everyone's voice is heard. It's not just about understanding the world as it is – it's about dreaming of
and working towards a world where everyone gets a say in how we use and share resources.