A fascinating new paper from the National Bureau for Economic research finds that adult mortality alone can account for all of Africa’s growth shortfall over the 1960-2000 period.
This comprehensive analytical and statistical study finds that high adult mortality induces people to invest less, accumulate less human capital, have a large number of children rather than fewer, children who are likely to survive and have be economically productive. This, in turns, lowers economic growth. The effect is economically very substantial. The linkage with fertility is particularly strong: as countries develop, the reduction in mortality precedes, and appears to cause, the fall in fertility (and not the other way round).
In my view, this has important policy implications. We should be careful about blaming Africa’s poor performance on its governments and institutions: this paper finds that the whole of Africa’s poor economic performance can be explained statistically by higher levels of mortality. Some of this may be an indirect result of poor governance; but the burden of tropical disease is also substantially higher in Africa; and the paper points out that poverty can be self-perpetuating, because countries are too poor to be able to devote resources to fighting diseases and reducing mortality. This suggests that we should focus on fighting disease as a significant investment in reducing poverty and helping to break out of this vicious circle. The proposal to create market incentives for the development of new vaccines for malaria, AIDS and TB, by promising to buy them if they are developed, would be an excellent start (full disclosure: this is what I work on).
Source: Death and Development, Peter Lorentzen, John McMillan & Romain Wacziarg NBER Working Paper 11620 (registration required; send me an email if you want me to send you a copy)
Hat tip: Stationery Bandit