Why are Countries Poor?

“Nearly 1/2 of the world’s population — more than 3 billion people — lives on less than $2.50 a day. More than 1.3 billion live in extreme poverty — less than $1.25 a day.” (Shah)

There are 196 countries in the world, some are rich and some are poor. What I want to know is why some countries prosper and others stagnate, so we can figure out what rich countries are doing right and to better understand the issues and challenges that poor countries face. I will argue that institutions, culture, geography and the West are four of the main reasons why a rich country is rich and a poor country poor. These four elements in order of impact are the main key factors describing what makes the global south and the west so different. I will provide more detail on each individual element below to reinforce my conclusion.

Institutions

Institutions are beyond important and are the most influential element in determining development within a nation. In general poor countries have very bad institutions and rich countries have good institutions. Access to democratic, educational, economic, and health institutions are some of the main structures that enable a country to prosper.

Poverty and corruption are directly linked. The countries with the most corruption are the least democratic. The more corrupt a country is the more likely they are to be poor. Where the richest countries are the ones with the least corruption. When a country is corrupt they cannot collect enough taxes to produce the good institutions that they need to escape the poverty trap.

“The poorest people will also have less access to health, education and other services. Problems of hunger, malnutrition and disease afflict the poorest in society. The poorest are also typically marginalized from society and have little representation or voice in public and political debates, making it even harder to escape poverty.” (Shah)

Half of the world's poorest countries wealth goes into off shore banks. This leads to a loss in revenue for the country. Therefore, without proper tax revenue it is extremely difficult to invest in an infrastructure that supports education, health care and proper economic institutions, which enable development.

Institutions provide access to health care, finance and education that are key components to reduce vulnerability of a population. When a population is vulnerable it is more likely to migrate to places that have access to these institutions. As stated before, most poor countries do not have the support or financial investment to build these institutions, so people migrate out of these poor countries to find countries that can provide access to good institutions, which reduce their vulnerability. Another way of looking at this is that when a poor country has no institutions, the citizens are pressured to migrate elsewhere. Once a migration starts to happen some of the most able working bodies leave the country to seek a better life and in effect, the country loses a good amount of its workforce. When a country has less people working it becomes less productive which leads the country into more of a conundrum.

Culture

Culture is the second most influential element that disables a country to develop. Cultures throughout the world create different belief systems. The effects of religiosity create these belief systems, which in turn facilitates the way people act. The more a country is a believer the less likely they are going to be rich. In the worlds poorest countries everyone is a believer. Why is belief correlated with lack of wealth creation and development? Religiosity is connected to the thought that the here and now cannot be improved so you should focus on the spiritual and look forward to a next world instead. This would make a lot of sense if you lived in a poor country with horrible living environments. In contrast to the poor countries and their religiosity, the rich countries generally believe in their capacity to alter their destiny through effort and talent.

To explain the anomaly of the United States and it being very religious and also able to create massive amounts of capital lies in the specific type of religion itself. “The United States most popular religion which consists of nearly half of the U.S. is Protestantism. Just over 50% of the U.S. population is Protestant.” (Pew Research Center) The Protestant religion advocates for its citizens to build Heaven in the here and now. Work is signified as serving the lord in any fashion. Whether it is tilling the crops, creating a business or even being a carpenter, all of these professions are an avenue to express one's devotion to God and to serve God. Thus, if most of the U.S. population believed work is their main purpose; in effect the nation becomes very productive and prosperous in the name of the lord.

Nature: Geography

Where the World's 7 billion live

Another explanation on why countries are poor is the Nature or geography argument, but compared to institutions it has much less of an impact on determining if a country is going to be poor or not. Most of the poor countries are located in highly tropical areas. The tropics are located near the equatorial region. The fact that most poor countries are located in these equatorial regions is not a coincidence. Many theorists believe that nature has to do with why a country is poor. But the only flaw with the Nature theory is that it assumes people cannot adapt to their natural setting. Life is much more difficult near the equatorial regions. Agricultural plants that grow in these regions have less nutrients and lack carbohydrates. Adding on to the lack of access to nutrient rich foods, livestock is a great source of obtaining wealth.

Access to horses, cows, and oxen can help farmers become more productive. This allows the farmer to be alleviated from having to plant their crops by hand. But in the tropical regions such as equatorial Africa, domesticated animal populations have been jeopardized by the Tsetse fly. This fly is specifically located in tropical areas of Africa and has had an enormous impact on the livestock populations. The tropics of Africa are humid and hot, which is a prime breeding ground for the Tsetse fly. This fly can kill large amounts of livestock, while also makes them lethargic. When the livestock is wiped out, the productivity of the farmers goes down, thus reducing profit.

It is not just plants and livestock that are harmed by inhabiting such dire living situations, humans are also susceptible to a range of diseases such as Yellow Fever, Malaria, E-Coli, Ebola, Cholera, Leprosy, Parasitic diseases and many more. When a poor country does not have access to healthcare facilities to treat these diseases many people cannot work and a large portion of the work force is left sick and sometimes these illnesses lead to death.

Geography also involves the ability for transport of goods and of people. Poor countries are usually hard to get to and are insufficiently connected to the rest of the world. The access to rivers and the ocean increases accessibility to transport goods and people from one place to the next. But in most land locked countries the access to transportation is very minimal, thus leaving the population unable to trade with the rest of the world. Bolivia, Paraguay, Afghanistan and Democratic Republic of the Congo (DRC) are all landlocked and some of the poorest countries. This is mainly due to their geographic location and the inability to transport goods in and out of their country.

Many poor countries have lots of natural resources such as oil and precious metals. These natural resources can help developed countries with good institutions to accumulate wealth. But in poor countries with natural resources and bad institutions it has proven to make them poorer, which is called the resource trap. “For example Democratic Republic of the Congo has a highly valued resource called Coltan. Every cell phone has a bit of it within the device.” (Munn) This extractive economy allows for the elites to accumulate the wealth by employing men with guns to make sure the laborers extract the resources for little to no pay. This scenario reflects the West and the Nature argument.

The West Argument

How the world would look if it were measured by it wealth

One might say that the West has caused the majority of poor countries to be impoverished through imperialism and colonization. In Africa, slaves were taken from their homeland and dispatched to a foreign country. The loss of human labor some say have led a majority of these African countries to end up poor. The West argument supports that colonial rule has impeded the development of the nation. While the Nature argument describes the lack of development in regards to geographical location and the habitat in which the country is placed.

Conclusion

Both the West and the Nature theories are valid in explaining how they have impacted development, but in the end, it is the lack of good institutions and the culture of the citizens within the south that have made the most impacts. If the institutions are not set in place for a functioning economy the development ceases to exist. The Nature argument can argue that the geography has made certain countries poor and others rich but this argument fails to acknowledge technology advancement and the ability for humans to adapt. It can also be argued that the West is the main reason why the global south exists by exploiting humans for labor and also through ethnic fractionalization. But it doesn't even consider that these ethnic boundaries might have existed before colonization.

We must consider that each explanation of why the global south exists is not because of one influence, but of many. Geography and colonization have played a role in the lack of development within poor countries but it is the institutions and the cultural norms that have played the largest role in development throughout the world. Let us help educate poor countries on how to create better institutions to ensure a better life. By creating better institutions it could also influence the cultural norms to adapt and change. This is why it is concluded that the presence of bad institutions and its cultural beliefs have the most impact on determining why the global south exists. We must create better institutions to enable the public to have access to health care, education and some form of democracy. This would ensure a safe place to enable poor countries to develop. In the end, it is institutions, culture, geography, and the west that has created the global south. But it is institutions and culture that have the most impacts in determining its development.

Bibliography:

PEW Research Center. "Statistics on Religion in America Report." Pew Forum on Religion and Public Life. Pew Research, 2015. Web. 2015. <http%3A%2F%2Freligions.pewforum.org%2Freports>.

Shah, Anup. "Poverty Facts and Stats." - Global Issues. Global Issues, Jan. 2013. Web. 28 Apr. 2015. <http://www.globalissues.org/article/26/poverty-facts-and-stats>.

Munn, Adam. "Computer Industry Impacts on the Environment and Society: Coltan Mining in Democratic Republic of the Congo."Computer Industry Impacts on the Environment and Society: Coltan Mining in Democratic Republic of the Congo. University of Michigan, n.d. Web. 28 Apr. 2015.

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