Friday 26 June 2009

Pressing the economic spring in Eastern DR Congo

I wrote in a previous post that Western DR Congo could and should develop economically as rapidly as possible despite the fighting in Eastern Congo, even if no adequate solution can be found for the East. The advice leaves open the question of what to do there.

I have been thinking about the description in my recent post on output (here) of how some economies were like coiled springs when the government enforced conditions that varied from growth maximisation. The economies had high levels of technological knowledge or education, but restrictions on accumulation. When the economies transitioned to an open capitalism, they experienced rapid growth.

There is a parallel between these countries during their pre-maximisation stages and Eastern Congo, in that private accumulation of fixed physical assets is very difficult there because of the conflict. So preparatory human capital and technological skill accumulation might be a way of preparing the economy to bound forward after the end of conflict.

My idea is not advanced at the moment, and I am trying things out. I think that it might turn on flexible education, creating the conditions to promote such education, and exposure to international technology.

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