This paper is meant to analyze the book The Great Escape: Health, Wealth, and the Origins of Inequality written by an economist Angus Deaton in 2013. As the author claims, revenue disparity among different nations has amplified over the last three centuries.
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Deaton gives the USA special attention, asserting that the extent of the nation’s disparity and its political troubles demonstrate the emptiness of the US claim of being a land of opportunity. The dynamics of disparity is particularly interesting.
The entire disparity of revenue is neither realistic nor advantageous, but the outcomes of disparity may be extremely harmful. The work’s vital geographical and historical background stresses the power of the message.
This work also offers a huge amount of smart statistical insights, causing the readers to imagine the cruel past, which the West has left behind.
In this book, the author fundamentally doubts the effectiveness of foreign financial aid, and demonstrates how the part of the global poor people are discovered not in Africa, but in booming, yet fundamentally uneven, economies of India and China. Simultaneously, author’s thesis is generally optimistic: humanity has made crucial progress while increasing its welfare.
In The Great Escape the author tries to tell the account of progress in profits and health during the past centuries. Through quite sincere preface, the author describe the experience of his own family to exemplify the book’s subject. The author’s father Leslie came into the world in a small village.
However, he attended night school to turn out to be a certified civil engineer, and then convinced teachers to educate his son.
Thus, young Angus and his sibling became the first children in the entire family to study at the university; nowadays, Leslie’s grandchildren live in “a world of wealth and opportunity that would have been a far-fetched fantasy in the Yorkshire coalfield” (Deaton Preface).
Angus’s father lived into his 90 year, and as the author mentions, his life story is one of enormous enhancements in health and financial security as Leslie’s parents passed away too young from illnesses, which could be cured nowadays.
Deaton uses the work of Robert Fogel in order to create his most significant point. He asserts that the influences of health and prosperity are self-reinforcing.
If an individual experiences reduced nutrition, he can face a trap when his possible profits are cut as he is physically exhausted to work, but with no work he cannot buy high-quality products.
At the same time, healthier people can work longer and more effectively, creating profits, which give them far better nutrition and wellbeing. Hence, better wellbeing and prosperity feed one another in this circle.
Generally, the future that the author predicts is a bright one as life is getting much better. Humans are generally richer than ever before. In 1820-1992, the percent of humans living in extreme scarcity globally fell from 80 to 25 percent.
The author treats the Industrial Revolution as crossroads in economic growth, turning over centuries of stagnation. Powers in Western Europe and the USA enjoyed evolvement at an unparalleled level. The development in those nations carried on accelerating after the Second World War.
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After the war there were many pessimistic predictions concerning how human growth would cause the mass famine in the Third World.
However, by the most noteworthy features – how long humans live, what they are aware of, how healthy they are – current existing has never been better. It is worth mentioning that the situation is continuing to improve.
The author certainly understands that some readers will treat these arguments with skepticism. Hence, he deals with possible skeptics with comprehensive and thorough depiction of how life of people all over the world has enhanced. Life expectancy demonstrates 50% since 1900, and it is still increasing.
The author uses many graphs and additional data to support his point of view. He attributes better health of people to increased nutrition and control of illnesses via public health measures. Moreover, better sanitation and clean water lessened the spread of sicknesses.
Other programs, such as vaccination program also lessened infant mortality. Also, in spite of the resultant populace outburst, the quality of life has enhanced. The part of humans living on less than one dollar a day has dropped to %15, from nearly 40% as it was in the year 1981.
This work’s final chapter is dedicated to the impact of foreign aid on national evolvement (Deaton 267-325). Consistent with the author, aid does not merely have a positive effect on the national evolvement; actually, it delays it.
The author claims that financial aid prevents evolvement by breaking the necessity for administrations to be answerable to their people. The supporters of aid claim that the aid has to be substantial to help the nation. Nevertheless, Deaton believes that this approach can fail, as the trouble is not, in fact, a lack of sources.
He asserts that it is corrupt and unproductive organizations and politics that hinder country’s economic growth. Moreover, there are certain troubles with the approach to the structure of financial aid. Hence, Deaton joins other economists in disapproving financial aid.
He does not think that all sorts of aid are terrible. In fact, aid can save lives. Nevertheless, the advantages that financial foreign aid offers, should be estimated against its drawbacks, and Deaton thinks that aid damages countries over the long run (Deaton 267-325).
The book elaborates on one fundamental recommendation for assisting the poor countries: reduce the aid budgets.
Aid never promotes development. In fact, abundant aid is a way to growth, which may damage institutions – permitting rulers to do whatever they want without any approval as they do not have to tax local populace.
However, Deaton treats far more sympathetically aid directed at enhancing health, as that may address certain malfunctions of market provision. Deaton admits that foreign aid has saved many lives in poor nations by reducing childhood deaths from contagious illnesses.
However, even in health field aid’s role is restricted by the fact that it does not assist in creating the necessary fundamental health system. Prosperous nations’ investment in investigation, whose advantages would flow to the poorest states, could be especially helpful. Aid as knowledge rather than money is precious as well.
Thus, the author concludes that the record of external aid reveals no confirmation of any general valuable influence. Financial help weakens organizations, democracy and national prosperity. He claims that the foreign assistance has to be cut.
The prosperous nations should leave the evolving nations to grow using their own resources, in their own time, just as all developed states did. Deaton explains that if all circumstances for evolvement other than funds exist, resources will be gathered locally quite soon.
However, if the circumstances for evolvement do not exist at the moment, then aid will be unproductive and, hence, useless. In fact, other tools, such as immigration, trade liberalization, and subsidy reform do more to support the national development.
Principally, prosperous nations have to stop creating barriers in the way of the growth of poor states. Trade restrictions and farm funding put poor nations at a terrible position. The regulations on intellectual property rights should be modified so that they can never show favoritism against the poorest states.
Easier migration can be the most useful aid policy. The immigrants from all countries are better off than ever before. The money they send back home also enhances the economic situation in the state.
These flows of money, which are, in fact, larger than the flows of financial foreign aid, may allow recipients to demand more from their administration, enhancing own political power instead of weakening it.
Essentially, the author offers the readers three significant messages:
First of all, for the majority of humans on this planet, life is longer, better and wealthier than all previous generations could have expected.
Second, obvious disparity within prosperous nations may be a hazardous issue. The author ties together the concept of Pareto optimality – the concept that some alteration reflects an enhancement if as a minimum one human being is feeling better.
This concept has been treated as the idea offering justification for trickle-down theories, but merely due to the fact that economists have used it narrowly to profits rather than to general social welfare.
In fact, disparity can be justified, but not the degrees of disparity in America nowadays, which weakens public services and provides the small interest groups with excessive lobbying control. The hazard is not merely to the happiness of the deprived citizens, but to general democracy and development.
Powerful and rich upper class has choked off economic development before, and they can do it again if they are permitted to weaken the organizations on which international evolvement depends.
Third, foreign aid is, in fact, a part of the dilemma, not the resolution. The author discusses other options, which might be more successful, embracing eradicating obstructive trade limitations, facilitating the temporary immigration and offering incentives for drug organizations to invest in medicines for certain diseases, for instance, malaria (Deaton 267-325).
To sum up, in his book, Deaton doubts the effectiveness of foreign aid, and portrays how the greater part of the global poor people are discovered not in Africa but in the flourishing, yet fundamentally uneven, economies, such as China and India.
At the same time, author’s thesis is generally optimistic: humanity has made crucial progress increasing its welfare.
This book is especially successful in two dimensions: it dedicates lots of attention to the thorough clarification of the measurement of dissimilar wellbeing features and ties among them; and the restrictions of what one can conclude from dissimilar features in terms of their causes and effects, given the accessible data and approaches.
This work avoids the intellectual disputes in economics, instead concentrating on offering the facts in an obvious and wide-ranging way. Hence, the book is mostly accurate and not controversial excluding the final two chapters.
Deaton, Angus. The Great Escape: Health, Wealth and the Origins of Inequality, Princeton, Princeton University Press: 2013. Print.