One of the hardest questions to ask and answer in development is the extent to which cultural structures and norms impact upon the pace of economic development and the probability of a transition to a more dynamic kind of socio-economic structure.
It’s a difficult question to answer for a number of reasons. Firstly, it’s extremely sensitive. While it’s relatively easy to argue that a cultural norm is good for development, it’s more problematic to regard one as retardant to positive change. It opens one up to charges of insensitivity. Beyond this, it is difficult to quantify, and as such is regarded as somewhat nebulous by economists. Culture is intangible and this makes it difficult to assess its impact on the material wellbeing of people. It also has a tendency to be used as an imprecise shorthand for a whole set of values, which may have different effects on development. Finally, even if we come up with a concrete relationship between aspects of a culture and development (for arguments’ sake), there is no clear remedial action or policy. One can’t simply change the culture of a country, group or region. Historically, the norms and behaviours prevalent in different societies have evolved over long time frames, partly in response to the environment or patterns of migration, and in other cases due to chance and historical accident.
I was discussing this with a colleague of mine earlier this week. He’s a sociologist from Cote d’Ivoire, who has worked in more countries than I can find in an atlas. I must confess that as far as the cultural history of Africa and its social forms goes, I’m still in the early stages of my learning. As such I don’t want to go into too much detail about this, or speculate too much on a field I’m not brilliantly acquainted with. That said, some of his ideas were interesting, though, and worth thinking more deeply about.
Social status and power in different societies is achieved and displayed in different ways. In some societies, it is inherited, for example, through caste. In others, status can be attained. What we discussed in particular was the mode of attainment and display of status in much of sub-Saharan Africa. His argument was that unlike in many other parts of the developing world, social status is not codified, but captured and retained through luxury possessions. Since the path to improved status is so open these days, it must be retained by the continued procurement and display of such possessions. This is a deeper argument than simple ‘conspicuous consumption’, which is a phenomenon visible in most parts of the world. It rather speaks to the desire of people to obtain power (from a position in the social order) through the visibility of their wealth. Conspicuous consumption is aimed at generating a lower form of power, something akin to envy, rather than more significant power that accrues a higher social standing.
Regardless of the motivations associated with the drive to such consumption in Africa, it has a significant effect on economic incentives and possibilities. A major and direct impact here is on savings. Since status is achieved through possessions, it follows that those with seeking improved status or aiming to sustain status tend to consume at a rapid rate. It’s not remotely uncommon to come across colleagues who spend a year abroad, saving money assiduously, only to use it to buy big ticket consumer items, such as a brand new and high-performance car, or expensively tailored suits. The issue is not the objects being consumed, but the effect this has on savings: when so much of the income earned is consumed, savings are reduced, thereby increasing the cost of credit for investment. Exacerbating this, since status appears to be linked to consumption goods, it is not enhanced by the accumulation of land. Thus, the accumulation of new goods does not have an impact on a land distribution pattern that makes mechanisation and private irrigation of land difficult.
Essentially, the argument suggests that in a society where owning and displaying items of luxury is the source of status, the consumption and savings behaviour of the rich, driven by concerns outside of the economic, restricts the capacity of the economy to expand through investment and accumulation. As such, the cultural norms governing the achievement and display of social status may be said to hamper economic development.
I’m not sure where I stand on this argument. It sounds convincing and I definitely do believe that cultural considerations have a concrete effect on the development process. I think this particular theory needs a lot more evidence before it can really be assessed. This evidence may already be out there. If it is, I’m not aware of it, and would be really grateful for any suggestions by readers on where I might begin to find some analysis of how different cultures in different places have impacted upon the process and speed of economic development. In particular, I’d really like to read something which makes a real attempt to tie this in with analysis of the economy, using economics and not just generalisations about consumption behaviour, as the theory above does.
One of my main aims in writing this blog is to propagate the message that to understand how countries have, haven’t and can develop, we need to be far more multidisciplinary. Most people recognise this, but then react to other disciplines by shoehorning findings into their pre-existing methodological framework. We need more people thinking like anthropologists to understand how cultural norms of exchange work, and then like an economist to understand how an economy will function under such cultural norms. Usually we keep our underlying ideas about the economy and then try and incorporate culture into our analysis of how it works. We need to be more able to question our basic beliefs based on what each discipline is unearthing.
In this spirit, I’ve posted on a topic I’m no expert on by a long sight. I hope anyone who knows more about this than me can offer counter-points.