Critique of ‘unwanted babies thesis’
The key theme of The elusive quest for growth is ‘people respond to incentives’. This is a statement that will find broad agreement – but the devil is in the details. In a chapter titled Cash for Condoms? Easterly discusses efforts by World Bank to contain population growth in various countries. He criticises the ‘cash for condoms’ programme by arguing that the is assumes ‘unwanted babies’ that people could not prevent since they did not have access to condoms. He trashes this argument saying condoms cost much less than babies do – and people have the incentive to choose condoms over babies if babies were ‘unwanted’. The fact that poor people go for babies is because it is profitable for them to do so in part because their low incomes mean they value their work less and can choose to do parenting and in part because they prefer the extensive earnings from many children than investing heavily on a few. Based on this he argues that ‘development [read growth] is the best contraceptive’ and thus reverts to the argument for ‘good policy’. While the insights above are broadly agreeable, understanding people’s choices solely with these trivialises the complex social, cultural, political and economic factors that govern decision making about having children.
Some states in India have achieved Total Fertility Rate (TFR) below the replacement rate. These are by no means the richest states in the country, and the poor in these states are very much a part of this demographic transition. Studies that look at this phenomenon argue that this was achieved with women’s empowerment (that enabled them to make choices about having children), literacy & information, access to reliable health facilities to exercise contraceptive choices, among other things. These are concerns that cannot be derived from an incentive approach.
Can all incentives be deduced from macroeconomic parameters?
That takes me to my main critique of Easterly’s work. One could argue that women have less incentive to choose contraception if they fear a social backlash or if health systems are ‘far away’ and costly, and thus internalise the above arguments into the incentive framework. All we are saying by people respond to incentives is that people take meaningful actions based on their self-interest within the social context in which they live. Our understanding of their actions depends entirely on how rich our understanding of the social context is, something that is sorely lacking in The Elusive Quest for Growth. As a result some of the analysis he presents is rather distorted. For example, he attributes the growth in population that accompanied the industrial revolution to the changing incentives for people to have babies: first it paid to have more babies but as earnings increased it paid more to invest in fewer children. There is no reference what so ever to growing medical knowledge or to public health measures!
I believe that it is possible to understand people’s choice to have children from the incentive framework. But this cannot be done without having close contextual information – social consequences of women’s choice of contraception, availability of safe contraceptive facilities, child survival rates, among other things are affected by social and cultural factors. More importantly for this argument, the presence of reliable and cheap public health facilities makes an important difference to the cost of contraceptive choice. The incentive to have more babies cannot be understood without understanding all these ground level information. Unfortunately, Easterly does not even pay lip service to these complex issues. Instead he ‘derives’ the incentive argument from the overall productivity of the economy. In the process he makes a strong argument for growth (and thus, ignoring complexities is a smart political choice), but trivializes options for controlling population.
This becomes dangerous when we look at it within the subtext of the “Good Policy” that he argues for through the book. The Washington Consensus mindset works against meaningful investments in public health, education and other public investments. Contraception is not equal to condoms and long term contraceptive choices often require safe, reliable and cheap public health systems in low income countries. The problem is that the growth fundamentalism that underlies his analysis combined with an unquestioned allegiance to conservative policies make a case for not investing in public health systems. If it does so, the practice of “Good Policies” can end up undermining the objective instead of achieving it.
Qualifications of my argument
My criticism needs careful qualifications. To begin with Easterly does not argue explicitly for a reduction of public health facilities. It is my deduction that his tendency to look at growth as the cure-all of every social problem combined with an almost unquestioned support for conservative policies makes a case for lowering public health budgets. If one were to go by policy debates in India and other countries by growth fundamentalists, I believe that my concern has a reasonable ground. Secondly, I do not argue that World Bank and IMF interventions always result in reducing public health spending. In some cases, I believe that they have led to significant interventions. I do not linearly link growth focus with low priority for public health. But one can make a strong argument that this framework works against public investments.
This does not dilute my critique that Easterly trivializes the complex phenomenon that demographic change is. If policy choices were made with this kind of information and approach, I am doubly sure that we cannot address the issue of population growth or any other social issue for that matter.