Do the statistics tell the whole story?

Well, after making the last post about the correlation between the Human Development Index (HDI) and GDP a good friend who works at the UN pointed out that while the statistical relationship may be there, measuring GDP can distort the whole picture when much of the growth is concentrated with the elite. It would be interesting to see if there are instances where GDP is growing dramatically but HDI is not keeping pace. That said, I still think more money, time and energy should be spent working to solve the problems of poverty rather than on determining the best way to measure its alleviation.

Is measuring "human development" redundant?

An interesting perspective from FLOW hit my in-box today that talked about the correlation between GDP and the Human Development Index (HDI), a measure of child mortality, literacy, education, and standard of living. As FLOW pointed out, "economist Miles Cahill shows that progress on human development, as measured by the HDI, is statistically indistinguishable from growth of Gross Domestic Product per capita. "

Since populations in developing countries are growing rather than declining the only way to increase per capita GDP is expanded economic growth. In other words, more growth will mean less poverty. When you factor in the fact that more women in the workforce leads to lower birth rates you have an additional positive contributing factor. I don't want to put any HDI researchers out of business, but maybe more money and effort should be put into building businesses than into measuring poverty statistics?

Powerful Peace Weapon: Free-Market Prosperity

This headline is the title of a new article by Steve Forbes that is available in his online newsletter. He uses the example of Northern Ireland and how three centuries of violence have given way to peace and prosperity after about three decades of economic reform. As Mr. Forbes points out: "Things started to change dramatically in the 1970s. Dublin aggressively courted foreign investment, using tax cuts and tax holidays as bait. Other tax and regulatory changes were made. Result: Ireland today is the most vigorous economy in western Europe. Its per capita income is now larger than that of Britain, France or Germany. The great boom in Ireland did not go unnoticed in the North, and in fact that region has benefited greatly from the Republic's prosperity. A vigorous, new middle class is rising in all of Ireland. As people become more prosperous they tend to focus on bettering their lives more than on blowing up their neighbors." (Emphasis added.)

At Economic Development Imports and at our partner company One World Projects, we've made a point of sourcing products from conflict and post conflict countries as a way of building peace. Our baskets from Rwanda, made by genocide survivors, and Phil's current trip to Afghanistan where he is sourcing jewelry and textiles are two examples of our peace through business approach.

The dominant architecture in Kabul is Early 21st Century War

This headline is pulled from the blog of my partner, Phil Smith, at One World Projects. He's in Kabul looking for new groups from whom he can purchase fair trade goods. While the buildings are uniformly bombed out and the security situation is "tense" to put it mildly, he has only positive things to report about the people and products he's finding. One such item I am looking forward to learning more about is this necklace from Medina Handicrafts, made from lapis and carnelian.

Medina’s mission is to empower vulnerable and disabled women through building their professional skills, providing literacy, health training and capacity building to help themselves and their families to reach self sustainability. To see other products and learn more about Phil's trip check back on his blog throughout the week.