1. 1 Theory of Development Garry Jacobs & Robert Macfarlane Seminar on Development Theory Chennai 1997

2. 2 u “Thinking on development is the greatest intellectual challenge of the coming years.” Boutros Boutros-Ghali Intellectual Challenge

3. 3 Observations u Pace of development is accelerating u Malthusian projections have not materialized

4. 4 Development Explosion u 12 fold population growth in 200 years u Urban pop. grew from 3% to 40%

5. 5 “500 yrs Progress in 50 yrs” UNDP u Poverty eradication -- famine, life expectancy, infant mortality, literacy, disease u Since 1950, average global pci has tripled u From 1965-85, real per capita consumption rose 70% in developing countries

6. 6 National Per Capita Output is Doubling Faster than Ever u UK 58 yrs from 1780 u US 47 yrs from 1839 u Japan 24 yrs from 1880s u After WWII u Indonesia -- 17 yrs u S. Korea -- 11 years u China -- 10 years

7. 7 Real PCI (ppp) Growth 1960-90 u 12 times in Korea u 7 times in Japan u 6 in Egypt & Portugal u 5 in Indonesia and Thailand.

8. 8 Regional Differences in PCI Growth (1965-90) u East Asia 5.5% u South Asia <2% u Subsahara <.25%

9. 9 Transition Economics Disastrous Results (1990-93) u GDP declined 10% in Poland u GDP declined 45% in Russia u GDP declined 75% in Armenia

10. 10 Capital alone does not generate development u Since 1990, Germany invested $1.1 trillion in East, u Unemployment in East Germany has risen above 25%

11. 11 Uneven Employment Growth u US employment rate at historic peak u European unemployment still rising

12. 12 New Economics u Best gets cheaper and cheaper u Function per $ continuously increasing u New goods & services being created more rapidly than ever u Value related to plentitude, not scarcity u Law of increasing returns u Networks grow in value exponentially u Getting more out of less material

13. 13 Status of Development Theory u Variety of factors identified u Primary focus is economics u Specific events & periods explained u No theory universally applicable

14. 14 Some Conclusions u Past achievements have been unconscious u We have experience of development, not knowledge effective everywhere. u The greatest achievements have not produced a generally applicable formula. u Conscious knowledge is a great power for accomplishment u Need for comprehensive theory

15. 15 Theory Reveals Potentials u Social theory can accelerate growth as medicinal theory improves health. u Fundamental laws are known u Role of organs understood u Interaction & integration of systems u Stages of development u Preventative and curative treatments u Precise statistical measures for diagnosis

16. 16 Purpose u To develop a comprehensive theory of social development that can be applied to increase the speed and efficacy of development efforts.

17. 17 Scope of Project u Phase 1: Theoretical foundations & principles u Phase 2: Historical applications u Phase 3: Current & future applications

18. 18 Purpose of this meeting u Phase 1 -- BIG PICTURE u Test rationality and consistency u Clarify our thinking u Challenge the ideas u Direct us to relevant ideas & resources

19. 19 Agenda u Introduction u Opportunities & Barriers u Central Thesis u Emergence of New Activities u Powers of Organization u Infrastructure & Resources u Three Stages of Development u Internet u Conclusions & Next Steps

20. 20 Issues u What questions should the theory answer?

21. 21 Theory Must Help Us Understand u What powers have made the already great advances possible? u What more can be accomplished through the use of these powers?

22. 22 Current Situation u There is potential to increase the speed of the social process. u Theory must be able to confirm or deny possibility of acceleration. u Theory should reveal the precise relationship between the factors required to achieve greater results.

23. 23 Peace u Theory must evaluate impact of internal and external social stability on progress. u War is a destroyer of development. u Drains talents and resources. u End of Cold War. u Greater International Stability u Great reduction in expenses-$400 billion u Increase of pace of world development u Rapid re-allocation of resources u Rapid re-alignment of economies

24. 24 Democracy u Provides stable & conducive basis for more rapid social progress. u Raises human aspiration u Encourages individual initiative for advancement u Release greater energy u Theory must explain the dynamics of the process by which the political and social factors impact on economic performance.

25. 25 Social Velocity u Development is a function of the velocity of social transaction. u Theory must account for speed in the past and how it has shaped history and how the increasing speed will shape the future.

26. 26 Technological Applications u Gap between innovation, diffusion and application. u Wide variation within and between countries. u Significant determinant of social policy. u Theory needs to explain variations and shows how they act as determinants of developments.

27. 27 Global Growth Engines u Shift from single or a few local centers to multiple centers. u Increase overall momentum of world energy. u Theory can not be limited to national policies. u Must look at development of global society.

28. 28 Essential factors are available for faster growth u Education u Technology u Information u Investment u Management know-how

29. 29 Theory must explain u The process by which new potentials are created & their role in development. u How potentials combine and intersect to determine its speed and direction? u Why achievements fall significantly below the maximum potential? u What are the unseen barriers to the process?

30. 30 Barriers to Development u Limited Perception u Outdated Attitudes u Anachronistic Behaviors

31. 31 Perceptual Walls Limit Further Development u Most common problem is that society is unable to envision its own future. u Tendency to see potentials as unattainable obstacles. u We still have a significant number of perceptual barriers today.

32. 32 Outdated attitudes not physical barriers are the most persistent obstacles to human development. u Distrust of new inventions u Distrust of new ideas u Today we insist on our privilege to maintain outdated attitudes

33. 33 Anachronistic behaviors also retard development u High birth rates u Indian Gold u UNDP $40 Billion

34. 34 The theory must reflect the role of man in both determining and overcoming self-imposed limits on social progress.

35. 35 Development is u a process, not a program or result u the upward directional movement of society from lesser to greater levels of energy, efficiency, quality, productivity, complexity, comprehension, enjoyment and accomplishment.

36. 36 Central Thesis u Development occurs by the creation of higher levels of organization in the society capable of accomplishing greater acts with more efficient use of social energies. u People’s energy, knowledge, aspiration, skill & attitudes drive development. u Society develops by organizing knowledge, human energies & material resources.

37. 37 Universal Principles u Principles of development are applicable to all fields of social life. u Principles of development are the same for individuals, organizations, nations and global community.

38. 38 Three Social Processes u Survival u Growth u Development

39. 39 Types of Development u Subconscious learning through trial and error experience. u Conscious initiative from knowledge to action. u Natural vs. Planned development

40. 40 Green Revolution -- Context u Subsistence agriculture u Dependence on imports u Threat of severe famine u Commitment to self-sufficiency

41. 41 Green Revolution -- Strategy 1 u Induction of advanced production technology u Seed import and replication u National demonstration plots u Attractive price & assured market for farmers u FCI to distribute surplus production to food deficit areas

42. 42 Green Revolution -- Strategy 2 u Increased import and domestic production of fertilizers u Expanded warehousing facilities u Reorganization of agricultural research & education under ICAR u Higher pay and status for scientists

43. 43 Green Revolution -- Results u FAO projection foodgrain 10% growth by 1970 u Actual growth 50% by 1970 u Self-sufficiency in five years u 100% in 10 years

44. 44 Green Revolution – Conclusions u Rare instance of conscious development. u People’s accomplishment, not just gov’t u Technology--valuable input, but not the key u Tapped farmers’ preparedness & aspiration u Created new organizations to supply missing links in society u Elevated entire social organization of agriculture in the country

45. 45 Some Questions u Why have so many other planned development initiatives failed? u Under what circumstances can the role of government be taken over by society?

46. 46 Emergence of New Activities in Society u What is the process that stimulates the emergence of new organizations? u What are the stages through which its proceeds? u What are the agents that determine its direction?

47. 47 Steps in the Process u Social Preparedness u Initiative of the Pioneers u Social Imitation u Multiplier Effect u Social Organization u Institutionalization u Cultural assimilation through family

48. 48 Three Conditions Determine Level of Social Preparedness u Energy u Awareness u Aspiration

49. 49 Energy u Existence of surplus energy to support movement from one level to another. u Available when society not fully absorbed in meeting the challenges at current level. u Surplus is a measure of mastery and accomplishment at the previous level. u The generation of new ideas, scientific experimentation and technical innovation are signs of surplus energy. u Energy is the fuel for growth of individual, organization and societies.

50. 50 Awareness u Energy creates the circumstance but requires awareness of potentials to produce results. u Awareness can grow naturally or be thrust on a community. u Speed of development increases as awareness spreads.

51. 51 Aspiration u Society must have felt need to achieve at a higher level. u Aspiration grows as awareness of external opportunities & internal capabilities increases. u Common problem is lack of aspiration.

52. 52 Theory must explain u When motivation for development is released or curtailed? u How different classes and communities respond differently? u How perception about the type and character of goal affects motivation? u Rapid spread of aspiration for development. u Alternations between rising urge and rising satisfaction.

53. 53 Initiative of the Pioneers u Individual pioneer is the instrument of accumulated social energy. u Pioneer sees & acts on opportunities that others do not see. u Pioneer exhibits new understanding, attitudes, skills & behavior. u Pioneer initiates the collective process. u Society expresses its intention and aspiration through the pioneer.

54. 54 Initiatives of the Pioneer - 2 u Without the pioneer, society lacks the vision to see the next stage of social progress. u The pioneer is not a rare exception. u Pioneer shares aspiration, knowledge and values of society with one new attribute. u Pioneer reveals a new opportunity based on society’s previous accomplishments.

55. 55 Social Imitation u Responses to the pioneer. u Premature development of the pioneer often leads to revolution. u Timely development built on social preparedness leads to smooth evolution. u Successful action of pioneer in tune with social aspiration encourages other dynamic individuals to imitate.

56. 56 Multiplier Effect u Widespread adoption of the idea unleashes a development movement.

57. 57 Social Organization u Each significant developmental advance leads to the emergence of a host of new organizations designed to support it u Puts pressure on existing organizations to elevate their functioning to meet higher demands of the new phase. u Each new organization increases range, scope, quality, convenience, productivity and efficiency of the social energies.

58. 58 Institutionalization u An organization matures into an institution when the social acceptance becomes total. u Institutions are supported by customs, beliefs and social tradition.

59. 59 Cultural Assimilation Through the Family u When an activity has matured to the point that the family plays a very active role in its transmission, the activity becomes a part of the culture of the society.

60. 60 Types of Organization u Physical u Social u Mental

61. 61 Physical Organizations u Roads u Railways u Town u Telecom links

62. 62 Social Organizations u Family u Military u Agrarian community u Market u Money u Industy

63. 63 Mental Organizations u Newspapers & books u Technology u Education u Science u Encyclopaedia

64. 64 Power of Organization u Roman army u East India Company u Henry’s Crystal Palace

65. 65 Characteristics of Organization u Utilizes human energy & capacities more efficiently. u Make every resource more productive. u Abridges space. u Abridges time. u Make possible what is otherwise impossible. u Admit infinite development.

66. 66 Organizations are skills of society u Skills of pioneer are institutionalized as organization.

67. 67 What gives organizations power? u Authority u Complexity u Systems u Integration with the society u Values

68. 68 Power of Authority u Personal and impersonal u Leadership u Laws u Policies and rules u Systems u Standards u Centralized and decentralized

69. 69 Complexity u Division of labor u Specialization of function u Coordination of multiple fields of activities u Integration of multiple levels of activity

70. 70 Systems u Create predictable responses u Increase efficiency u Increase speed u Improve quality u Limit the need for expertise

71. 71 Integration with society u Organizations acquire life from social integration. u Natural outgrowth of society’s energy, awareness, aspiration, skills & values. u External models often fail. u Can be adapted to cultural variations.

72. 72 Values u Internalized social aspirations u Focused authority u Powerful organizing principle u Psychological skills of society u Ultimate determinants of development u Evolve with society

73. 73 Infrastructures are the foundations of the society’s previous achievements on which new organizations are built.

74. 74 Types of Infrastructure u Physical--roads, ports, rivers,railways, electric power. u Social-- laws, systems, administrative, commercial, productive and financial organizations. u Mental--level of education, awareness in society, availability of information. u Psychological--collective social energy, aspirations, attitudes and values.

75. 75 Nature of Infrastructure u Each successive level of development requires the establishment of an essential infrastructure to support it. u Each activity requires multiple types of infrastructure to be successful. u The result of a new activity depends on the strength and quality of the underlying infrastructures.

76. 76 Implications u Before undertaking any development initiative, essential infrastructures need to be identified and put in place. u Supplying missing links can energize development.

77. 77 Resources are u Inputs for carrying out any activity.

78. 78 What makes a resource? u Mind discovering a use for anything.

79. 79 Characteristics of Resources u Actual vs. potential u Essential and non-essential u Four types

80. 80 Physical Resources u Land u Water u Fuels

81. 81 Social Resources u Organizations u Systems u Money

82. 82 Mental Resources u Information u Technology u Knowledge u Creativity

83. 83 Psychological Resources u Energy u Skills & capacities u Attitudes

84. 84 Nature of Resources u There is no such thing as a natural resource. u The mind is the creator of all resources. u As society develops, the application of mind increases the productivity of materials and processes. u The more open and flexible mind is in its outlook, the greater its power.

85. 85 Limitless Potential of Resources u Vast potential to increase the productivity of physical resources. u Vast potential to decrease consumption by improved efficiency. u Application of non-physical resources enhances value of physical ones. u Higher resources are not limited. u As society develops non material resources play increasingly important role.

86. 86 The Human Resource u All development reduces itself to the development of human beings.

87. 87 Restatement of Theory u Development is the process of increasing the scope and complexity of the fabric of social organization and its intricate interrelationships by u quantitative expansion u qualitative enhancement u spatial extension of organized fabric u integration of existing and new elements

88. 88 Stages of Development u Three overlapping stages on a continuum u Progress is non-linear. u Progression from each stage to the next stimulates exponential increase in productivity.

89. 89 Three Stages of Development u Physical u Vital u Mental

90. 90 Characteristics of Physical Stage u Focus on survival, protection & preservation u Feudal agrarian society u Land is wealth u Physical strength is power u Ideas based on tradition & superstition u Rights and power physically inherited u Human resource is physical labor

91. 91 Characteristics of Vital Stage u Focus on expansion, enterprise and conquest u Religious reformation u Mercantilism replaces feudalism u Money is wealth u Economic strength is power u Merchant class supplants aristocracy u Ideas based on practical utility u Human resource is social energy

92. 92 Characteristics of Mental Stage u Focus on power of knowledge u Enlightenment & birth of science u Political idealism -- human rights u Technology applied in industry u Information & knowledge is source of wealth & influence u Universal education u Information Age u Human resource is mental capacity

93. 93 Three Overlapping Stages

94. 94 Organization in the 3 Stages u Language, agriculture & urbanization u Money & commercial institutions u Industry, technology, education

95. 95 Power of Money -- 1 u Exponential impact on development u A convention or symbol for value u Increases speed, size, efficiency of transactions like language u Convertible into any other resource u Store results over time u Transport results over distance

96. 96 Power of Money -- 2 u Its power multiplies with wider usage u Increasing velocity increases its productivity u Creates standard for measurement u Capacity to evolve new forms u Increases freedom of choice u Impersonalizes & democratizes transactions

97. 97 Money as an Organization u Created by surpluses u Depends on authority of political and economic institutions u Based on social complex infrastructure u Promotes complex transactions u Relates & integrates all social activities u Based on values of trust & confidence

98. 98 Organizations in Each Phase u Physical- Language u Social- Money u Mental u Schools u Universities u Libraries u Internet

99. 99 Conditions for Emergence u Political freedom u Global affirmation of human rights u Abundant social energy u Irrepressible mental inquisitiveness u Accumulation & codification of knowledge u Universal education u Global revolution of rising expectations u Explosion of inventiveness u Increasing organizational creativity

100. 10 0 The Emerging Social Will u High levels of political freedom u High levels of social expression u High levels of individual empowerment u Wide spread prosperity u Extensive higher education u Anticipation and excitement over scientific discoveries u Insatiable thirst for information u Rapid assimilation of new technologies

101. 10 1 Infrastructures Supporting the Creation of the Internet u Physical infrastructure - Convergence of two technologies u Computer u Telecommunication u Incremental improvements in many technologies u Standard languages interface

102. 10 2 Internet Infrastructures - 2 u Social infrastructure- u Change from isolated specialized use of computer to creation of vast networks. u Creation of a new model of social organization without centralized authority or hierarchy.

103. 10 3 Internet Infrastructures - 3 u Mental infrastructure- u Scientific knowledge and technical capacities. u Spread of general education. u Computer literacy and skills. u New mental energy and capacity to accept and adapt a new medium.

104. 10 4 Internet Infrastructures - 4 u Psychological infrastructure u Social leveling u Thirst for information u Lack of fear of technology. u Public enthusiasm and readiness to adopt

105. 10 5 Preconditions u Huge accumulation of surplus capital u Mental energy u Leisure time

106. 10 6 Powers of the Internet u Universal access to information u New medium for commercial transactions u Levels playing field between companies u Medium for financial transactions u Medium for distance education u Low cost communications u Creation of special interest groups u Low cost way to publish views and ideas u Access to knowledge and expertise u Direct access to the democratic process

107. 10 7 Value for Developing Countries u Commercial & technical information. u Access to markets and customers. u Access to new products and processes. u Access to outside expertise. u Access to scientific knowledge. u Alternative delivery system for broadcasting, telephone etc. u Support global citizenship & community.

108. 10 8 Impact of Internet u Increases speed of information exchange. u Makes many transactions instantaneous. u Increases speed & quality of decisions. u Increases access to goods and services. u Makes customized and personalized services affordable and accessible.

109. 10 9 Potentials as Internet Develops u Releases greater mental energy. u Encourages mental creativity. u Make results available to wider community. u Drives the growth of a new self directed society without external compulsion. u Creates new skills to increase productivity of society.

110. 11 0 Potentials - 2 u Creates maximum # of connections between different fields of activity. u Drives the spread of strong values. u Empowers the individual with unlimited access to knowledge. u Reduces the limitations placed on humanity by space and time. u Elevates people from physical to mental. u Symbolizes collective accomplishment, shared inheritance and human unity.

111. 111 Applications u Not a substitute for economic theories u Creates perspective for specific theories u Identifies need for other specific theories u Starts with perception of social aspirations & preparedness

112. 11 2 Summary of Principles -- 1 u Development is a process, not a program. u Natural process of development is unconscious u Conscious development can be ten-fold faster than unconscious. u Principles are same for individuals, organizations and societies.

113. 11 3 Summary of Principles -- 2 u Development is the creation of higher levels of organization. u The motive force is human need and aspiration. u Driving force for development is the collective will for higher accomplishment. u Development occurs on basis of surplus energy, awareness of opportunity and aspiration.

114. 11 4 Summary of Principles -- 3 u Development takes place when society imitates the activities of pioneers and organizes to support those activities. u Organization matures as institutions & culture (values). u Organization admits of infinite development.

115. 11 5 Summary of Principles -- 4 u Development is founded on four levels of infrastructure. u Four types of resources support development. u Social organization is a single, interconnected fabric of organized activities and relationships.

116. 11 6 u Society develops through three overlapping stages -- physical, vital and mental. u Progress from each stage to the next stimulates exponential increase in productivity. Summary of Principles -- 5

117. 11 7 u Global population has multiplied 60,000 times since invention of cultivation. u Qualitative development has been proportionate. u Rate of advancement is accelerating. u Each advance brings a new set of limits to overcome. Overview of Human Progress

118. 11 8 What are the limits? u The ultimate resource is Mind, the creator of all resources. u No limit to mind’s capacity to create, so resources are endless. u All development is development of human beings.