This article also appeared in the Autumn 2009 edition of Stanford Business magazine
Economics
Research by
Michael Spence
Dean Emeritus
Stanford Graduate School of Business
Chairman,
Independent Commission on Growth in Developing Countries
FOR FURTHER INFORMATION: Helen K. Chang, 650-723-3358, Fax: 650-725-6750
Spence Describes Developing World Growth
January 2009
STANFORD GRADUATE SCHOOL OF BUSINESS—Many countries in the developing world are growing at the amazing rate of 7 percent annually. Yet it will still take on average 50 years for these nations to move from poor into the economic mainstream.
Business School Dean Emeritus Michael Spence, who serves as chairman of the Independent Commission on Growth in Developing Countries, discussed findings of the commission in a January 6 speech to the Stanford Institute on Economic Policy Research.
According to the Commission's report, fast sustained growth is not a miracle; it is attainable for developing countries with the "right mix of ingredients." Countries need leaders who are committed to achieving growth and who can take advantage of opportunities from the global economy. They also need to know about the levels of incentives and public investments that are necessary for private investment to take off and ensure the long-term diversification of the economy and its integration in the global economy.
"We chose to focus on growth because we think that it is a necessary condition for the achievement of a wide range of objectives that people and societies care about," said Spence. "One of them is obviously poverty reduction, but there are even deeper ones. Health, productive employment, the opportunity to be creative, all kinds of things that really matter to people seem to depend heavily on the availability of resources and income, so that they don’t spend most of their time desperately trying to keep their families alive."