of the last century, most of development was geared towards increasing national incomes, on the assumption that developing towards wealth could lead to other benefits. Let’s explore further what twentieth‐century development looked like, and then consider what it means for an increasingly interdependent world with finite resources.
Twentieth‐Century Approach: Development as Economic Growth
For roughly the past century, “development” has been viewed primarily through the lens of economic growth plus the social changes caused by or accompanying that economic growth.2 Economists have traditionally used gross national product (GNP) or a country’s average per capita income as the measures of economic development. Some organizations, such as the World Bank, also divide countries according to their level of income, and consider low‐ and middle‐income countries to be “developing” and high‐income countries to be “developed.” High‐income countries were early adopters of intensive manufacturing. They amassed large amounts of wealth that lifted many of their citizens out of poverty; economists referred to these “industrialized” nations as “developed” nations. Most of them are located in the northern hemisphere, so they are also sometimes called “the North.”
If we accept the vision of development as building wealth, it makes sense that the overwhelming priority is to transition from economies of subsistence (prioritizing getting households the basic resources on which to live) to economies of consumption (prioritizing getting households greater incomes to rapidly increase consumption and further stimulate the economy). This approach typically leads first to a transition towards industrialized economies, and then, as machines replace workers, to a second transition towards economies based on goods and services.
In the 1950s and 1960s, it was common to think of development only in economic terms. It was, of course, economic growth with the agricultural and industrial revolutions that created the increased food and higher standards of living that permitted more human beings to inhabit the planet. The development that took place in Europe and the United States as they industrialized led to an increase in the average family’s income, and this meant more money to buy goods, including food.
In the second half of the twentieth century, nations generally took one of two approaches to development. The first approach was to develop government policies focused on creating jobs and providing social services to meet basic needs.3 The other approach, encouraged by international development institutions like the World Bank, re‐evaluated the role of government in economic development and focused on minimizing government influence on market prices by gearing public policies away from regulation, encouraging the private sector to provide social services (also known as “market‐based solutions”).4 This market approach became known as the “Washington Consensus,” focusing on economic efficiency and fiscal discipline. Much foreign assistance in the twentieth century certainly encouraged nations along this route. The market approach in particular assumed that economic growth was functionally synonymous with “development.”
Unprecedented economic growth and material prosperity took place in a handful of countries like the United States during the twentieth century, and this was made possible, in large part, by cheap energy and abundant access to resources, often exported from other countries. The desire to achieve the high living standards of the Northwest by following the route taken by the United States and other wealthier nations – both capitalist and communist in the past – with their emphasis on industrialization has been attractive to many governments as a seemingly clear development path towards poverty reduction.
Mostly by default, this became the “model” for development, where individual lifestyles and modes of industrial production were based on converting raw materials to more expensive and useful productions, utilizing plentiful, inexpensive, polluting energy – a model that has driven climate change and placed the future of our planet in jeopardy. For example, in the 1990s, the Chinese economy grew at an amazing 10 percent a year, lifting millions of people out of poverty. And with this new wealth came a massive need for increased energy production as well as a tidal wave of demand for the increased production of consumer goods.
But does this kind of development work for everyone? Results have been mixed, and you can use this book to help make your own assessment. Some of those working in international development recognized that this development strategy was a gamble, that maybe benefits would not trickle down to the poor, but the alternative of trying to work directly with the millions of rural poor did not seem viable. Poverty rates dropped substantially in a number of industrialized countries – although in some places, national incomes went up more than poverty rates went down. The Washington Consensus led on one hand to increases in the GDPs of many countries but also to cuts in social spending – and as a result some of the poorest became even worse off.5 By some estimates, only 20 percent of development assistance reached rural populations, even though the clear majority of people lived in rural areas.6
The process of creating wealth has also created negative impacts to the environment. Countries are slowly realizing that the effects of economic activity on the environment should not be ignored. But awareness is not high in countries, especially ones that are still in the early stages of industrialization. This helps explain why some countries have welcomed polluting industries, such as factories that manufacture asbestos, since jobs today are often prioritized over a vague worry that workers may contract cancer in 20 to 30 years. But also, a slowly growing number of people realize that if the economic activity that gives jobs to people harms the environment, future costs resulting from that economic activity may become substantial.
Twenty‐First‐Century Approach: Developing towards Sustainability
At first, global discussions about development, environment, and social issues occurred on very separate tracks. The 1972 Stockholm Conference on Human Environment was seen by many poor countries as an effort by rich countries to constrain the development of the rest of the world under the auspices of environmental protection. The view at that time was that environmental protection was a luxury that could only be afforded once a country had developed. Besides, countries argued, most of the environmental problems were located in the handful of countries that had been able to accumulate wealth as they industrialized without the controls. But as environmental problems became more widespread, so did discussions about how they related to the development process itself.
In the 1970s an awareness grew – in both the “less developed” nations and the “developed” industrialized nations – that some of the social and environmental changes which were coming with economic growth were undesirable. More people were coming to understand that for economic development to result in happier human beings, attention would have to be paid to the effects that economic growth was having on social and environmental factors. Were an adequate number of satisfying and challenging jobs being created? Were adequate housing, healthcare, and education available? Did women have equal opportunities? Were people living and working in a healthy and pleasant environment? Did people have enough nutritious food to eat? Every country is deficient in some of these factors and, in this context, is still “developing” in some capacity.
By the 1980s, concerns were mounting about the social and environmental implications of more and more countries following a development model based on ever increasing rates of production and consumption. By 1987, the concept of “sustainable development” emerged in a landmark report by the Brundtland Commission called Our Common Future. The term means that economic growth in the present should not take place in such a manner that
