OPINION: Why Guyana is ‘winning’

Last Updated on Thursday, 17 October 2024, 18:31 by Writer

By Dr Randy Persaud, Professor Emeritus, American University, Washington DC

By now you know that the 2024 Nobel Prize in Economics has been awarded to two MIT economists, Daron Acemoglu and Simon Johnson, and political scientist, James Robinson of the University of Chicago. The technically correct name of the award is the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel. Apart from the obvious prestige for the winners of this most coveted acclaim, the 2024 Nobel Prize in economics has meanings at other levels, including for Guyana.

The anchoring work for the Prize is Why Nations Fail: The Origins of Power, Prosperity and Poverty, a book first published by Acemoglu and Robinson in 2012. But beyond this particular work, the ideas developed by the three scholars have received considerable attention in the international development community for several decades.

You can think of the work of development scholars such as Jagdish Bhagwati who, in the late 1950s, critiqued “immiserizing growth,” or Amaryta Sen whose idea of “development as freedom” spawned a generation of democratic economic development scholarship and practice. Bhagwati, though a traditional pro-market ‘liberal’ economist, developed the idea that misdirected economic growth can lead to ‘immizeration’, meaning that growth does not necessarily lead to development. That idea is not lost in the work of Acemoglu, Johnson and Robinson. Nor is Sen’s simple but path-breaking notion that political and personal freedom should precede growth and development, rather than follow it. Stated differently, Sen offered a broad-based critique of developmental authoritarianism and replaced it with socio-economic development based on human security.

The main ideas of Why Nations Fail include, but are not restricted to, inclusive rather extractive economic policies, strong and capable institutions, democratic political institutions, and participatory governance. The central articulating principle that undergird prosperity is that democratic political institutions drive sustained economic growth. A key ingredient here is that open political systems allow for broad input into policy making. This includes forms of governance that engage critics, rather than suppress them.

These arguments have relevance for Guyana. Although we need not unnecessarily dwell on the past, we must acknowledge that the worst years of economic existence in modern Guyana were from the mid- 1960s though the late 1980s, a period when heavy-duty political authoritarianism squashed individual freedoms, and with it economic growth. At the end of the 1980s, Guyana was the only country in the world that had a lower per capita GDP than it did at the beginning of the decade!

Nothing symbolized this more than the institution of Party Paramountcy. This last was the fulcrum of authoritarian governance. Little wonder that Guyana had negative growth rates for most years during these dark times. And no one should be surprised that with the return of democracy in the early 1990s, economic growth picked up. Readers should not underestimate the significance of the rescue of democracy in 2020. If we follow the arguments of Why Nations Fail, we could reasonably conclude that had the electoral fraud attempt of 2020 been successful, this country would have been heading towards the abyss, oil, or no oil.

I wished that Acemoglu, Johnson, and Robinson had been more explicit in calling for the defence of democracy. If they implied it, we need to be open, bold, and insistent on keeping democracy alive. The truth is that Guyana is ‘winning’ today because participatory governance is alive and well, and also because the democracy is being comprehensively institutionalized.

Dr. Randy Persaud is an adviser in the Office of the President.