Containing One Waste Would Contain Another
As I watched Slumdog Millionaire – the internationally acclaimed film that tells the story of Jamal, a child from the slums of Mumbai who confounds all expectations by sweeping the Indian version of Who Wants to Be a Millionaire – I began to consider how many Jamals the world has already failed. How many Einsteins or Beethovens across the developing world never had the chance to blossom?
Despite the targeted efforts of international development programmes over the past six decades, evidence suggests that 1 billion children continue to live with one or more form of deprivation. Hundreds of millions of children live without adequate shelter, access to safe water, essential health services or school attendance. The precarious condition in which these children live is not just a scar on humanity at large, but also represents a terrible waste of talent. This waste clearly sets poor countries back and undermines the future of the greater world in which we all live.
The waste of potential that children inherently have is just one example of a squandered asset. Poor countries often waste other resources because they are not organized in a way to capitalize on the resources they have. There are multitudes of ways that the productive potential of the adult population is also dissipated.
I believe utilizing the perspective of problems faced by poor countries in terms of ‘wastes’ is useful in identifying ways to reduce lost opportunities. It was an attempt to contain a waste that led me to conceive of what is now known as Grameenphone, a for-profit mobile phone company in Bangladesh. When people can connect with each other through mobile phones, they waste less productive potential. They make better use of their time, miss fewer opportunities, and achieve and earn more. As a result, ordinary people have more money to spend on the very services that make them more efficient and productive. Because companies recognise that consumers will pay for services that help them produce and earn more, these companies invest in infrastructure to provide these services. In short, for-profit companies like Grameenphone grow from—and are sustained by—the bottom-up force of ordinary people’s desire to turn ‘wasted’ productivity into gains.
Many more such businesses could assist the adult populations in poor countries in achieving higher levels of productivity. We sometimes hear that there are 1 billion people who make $1 a day and another billion make less than $2 a day. Combined, these 2 billion people make $1.5 a day, or a trillion dollars a year. If their waste of productive potential was reduced by a small 5 per cent, they would generate an additional $50 billion. If half of this $50 billion were applied to improving the lives of children, it would unleash a much larger resource than all the existing international programmes geared towards children.
I believe parents would dedicate their increased earnings towards their children. Across the world, regardless of socio-economics or education, parents choose what is best for their children. Therefore, we cannot reduce the waste of children’s future potential without reducing the waste of the current productive potential of parents. Containing one waste would contain another.
Economic growth will empower parents to demand — and give them the means to provide — further care for children. For example, in the case of education, the supply grows out of the demand. Udaia Kumar, the founder of SHARE, India’s first micro-finance firm, put it this way: “If there is hunger and ignorance, which one will you address first? On the other hand, once a family is well-fed, the parents automatically send their children to schools.” Centuries ago, the same sequence occurred in England. In the late 12th century, the English accounted for a full third of students at the University of Paris. When all foreign students were subsequently expelled from the University of Paris, these English scholars settled in Oxford, giving rise to the university there. Underlying the creation of British institutions for higher education was this: Two centuries earlier, England had experienced a considerable boost in agricultural output, and families could then afford education and sent their young to France for schooling. Extra income led to the demand for education that later gave rise to educational institutions. This is repeated in the American experience as well: Improved technologies led to higher productivity of the farms, giving rise to both the ability to pay for schools and a reduction in the need for children to work in the fields.
Furthermore, the general economic condition of the adult population determines what children will do when they grow up. If the adult population is unable to engage in a vibrant commercial environment, educated children are not absorbed in the economy fully. Education in that case is simply wasted, unused or employed to escape from the country. The majority of American immigrants from Africa and South Asia are highly educated; most corrupt government officials are educated.
In short, I believe that one of the best ways to create a supportive environment for child rights is to create a prosperous society for the adult population. We need bottom-up entrepreneurial economic growth. This type of economic growth can be organic and self-sustaining, opening up the highway through which education, jobs, health care, rights and other benefits for children would arrive.
As the Director of the Legatum Centre for Development and Entrepreneurship at the Massachusetts Institute of Technology, I am sometimes asked why we focus on for-profit enterprises in low-income countries. The simple answer is that profit-driven entrepreneurial efforts give rise to organic growth and innovation, increasing productivity, economic standing of citizens and government accountability. Entrepreneurship is a proven, distributed approach to increasing opportunity and possibilities for those in poverty.
Jamal’s story speaks to our belief that all children have talents and potential. There are hundreds of millions of children with great potential who are currently woefully overlooked – we should not be depending on lotteries or on Who Wants to Be a Millionaire. We need to foster economies in which children live, and, in turn, release them and their parents from the thrall of poverty.
Professor Iqbal Z. Quadir is the founder and Director of the Legatum Centre for Development and Entrepreneurship at the Massachusetts Institute of Technology (MIT), which promotes bottom-up entrepreneurship in developing countries. In the 1990s, Quadir founded Grameenphone, which provides effective telephone access throughout Bangladesh. Quadir is often credited as having been the earliest observer of the potential for mobile phones to transform low-income countries. His work has been recognised by leaders and organizations worldwide, as a new and successful approach to sustainable poverty alleviation.
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