By John Weeks
A research of the heritage of Sierra Leone focusing on financial facets. Conclusions and attainable choices are recommend by means of the author.
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Extra info for Development Strategy and the Economy of Sierra Leone
Part B: UNCTAD: Performance of selected LDCs having implemented adjustment programmes over consecutive periods since mid-1981 Growth rate 1970-80 1980-86 12 LDCs with IMF programmes: Growth> LDC average (1980--86) 1. Bangladesh 2. Malawi 3. 9 'LDCs' here refers to least developed countries. *Inflation average does not include Uganda. SOURCE UNCTAD, 1989, p. 12. 1* na na 24 Development Strategy and Sierra Leone developed countries (Bangladesh, Malawi and Somalia, listed at top of table 20). Perhaps most indicative of the arbitrariness of the World Bank calculations (and perhaps of UNCTAD also) is that the two sources do not agree on the basic question of which countries should be considered as 'adjusting'.
It ignores distribution within the two sectors; for example, between farm and non-farm households in the countryside. The political bias enters by considering the demographic character of a household's status to be more important than what that household does for its livelihood and where it is placed within the class relations of production. The arbitrariness arises from the implicit assumption that the income variance between groups exceeds that within groups. These obvious points have not deterred the World Bank from repeatedly using the rural-urban dichotomy when considering distributional issues.
The argument that increased agricultural prices also aid non-farm rural families through increased farm wages or other spread effects represents an empirical argument that cannot be established with any degree of theoretical generality. If rural labour is in surplus, higher prices may increase employment, but not wages, in which case those previously employed would be worse off. Further, if supply responds inelastically, producer incomes might rise, but employment increase very little. By comparing farm income to urban wage income, the distributional effect of increased agricultural prices is clear: they improve the lot of farmers (in so far as farm families produce a surplus for market and th~ higher price reaches the producer), and diminishes the welfare of the latter (for food prices) or leaves it unchanged (for export crop prices).