Last post

This is my last post on Out of the Blauw. From now on, I'm writing full time for De Correspondent. This Dutch online journalism platform focuses on background, analysis, investigative reporting, and the kinds of stories that tend to escape the radar of the mainstream media because they do not conform to what is normally understood to be news. 

In my articles, I will aim to demystify the world of data and statistics. In addition, I will continue to write about happiness as a new measure of well-being. 

You can read my articles for De Correspondent here.

Twitter: sanneblauw 

E-mail:  sanne@decorrespondent.nl   

Freedom for all! A (selfish) pledge for open borders.

This blog post originally appeared in Dutch on the Oikocredit Netherlands website.

The compassion for refugees – or, more generally, for all immigrants – seems often to be dominated by the fear of immigration’s economic consequences. That fear is understandable, but is it also justified?

‘If you put two economists in a room, you get two opinions’, Winston Churchil famously said. He then added: ‘unless one of them is Lord Keynes, in which case you get three.’ It was therefore surprising when, in 2006, five hundred economists agreed upon one thing: immigration is good for the economy. In an open letter to President Bush they expressed their concerns about the fear of immigration. Concerns about immigration are common and understandable: what if I lose my job? what if my wage goes down?

Such fears, however, are ‘exaggerated’ according to the letter’s signatories, who come from widespread ideological backgrounds: among them were Gregory Mankiw (a former economic policy advisor to George Bush) and Bradford DeLong (a progressive economist and blogger). The economists’ letter was not based on political ideals, but on scientific evidence.

Theory

First, there are a number of theoretical arguments in favour of immigration. Immigrants might ‘steal’ jobs, but they also buy more products. As a consequence, the market grows and more jobs are being created. We thus share the economic pie with more people, but the pie is also larger.

No one doubts the value of highly educated immigrants. Think of the Russian Sergey Brin, who founded Google, or the Taiwanese Jerry Chang, who started Yahoo. And  let’s not forget that immigrants played a key role in the Dutch Golden Age.

What about immigrants with a lower educational background? They can also make a valuable contribution to society. For example, certain services will become cheaper, such as childcare. In turn, this enables women to free up time for a job.

Practice

Nice theories, but how does it work in practice? Mette Foged and Giovanni Peri investigated the effects of immigration in Denmark. Many immigrants have arrived there since 1995 as a consequence of political crises in Bosnia, Somalia, Afghanistan and Iraq. Foged and Peri found that those waves of immigration didn’t have an impact on unemployment. Even more surprising: the salaries of low-educated Danes increased. The arrival of immigrants caused them to find other – better-paid – jobs.

Of course, economists have a considerable blind spot: they tend to ignore social, political and cultural consequences. Immigration might raise crime or change cultural norms. Nevertheless, possible disadvantages seem to be outbalanced by the benefits. German research shows that immigration positively affects the local population’s happiness.

A toast

I’m completely in favour of the moral arguments for immigration, but those arguments don’t seem to hold water in the current debate. They lose ground against unfounded populist arguments. That’s why this blog post shows: immigration is not only good for ‘them’, but also for ‘us’.

So let me propose a toast. To those who find their way to The Netherlands or other countries. To those who wish to make their lives more beautiful and thereby enrich our lives. A toast to freedom.

Want to read more?

The website openborders.info shows in a nuanced and informed manner that open borders are a win-win-win situation: good for the migrant, the home country and the country of destination. I can wholeheartedly recommend this website, because both sides of the debate are represented.

Thanks to Martijn Hendriks of the Erasmus Happiness Economics Research Organsation (EHERO).

Je suis Charlie. Que dois-je faire? (English)

After the attack at Charlie Hebdo, I want to do something. But what does ‘doing something’ mean? Diary of a struggle.

January 7th, 12.30 PM

I listen to the radio and hear about the attack at Charlie Hebdo. Charlie Hebdo? Never heard of it. There are still many unknowns. I’d like to say that I am glued to radio, TV and internet for the rest of the day, but that’s not true. I go into town.

January 7th, 9.00 PM

I come home and start to read more about the attack. I’m shocked, but my emotions don’t go very deep. I live in a world where news has become entertainment, and entertainment news. Almost nothing shakes me to the core. I try to tweet the cartoon above. The WiFi signal is too weak. I decide to try it again tomorrow and go to bed.

January 8th, 8.00 AM

As is often the case, the best ideas arise when I’m taking a shower. This is not okay. I have to do something. If only to wake myself up. In a speeded-up society like ours, I decide to give the most valuable thing that I have to offer: time. I will spend all the time needed to read, watch and listen to everything that I can find on #CharlieHebdo.

January 8th, 4.00 PM

I’ve read the Volkskrant,* sifted through Twitter, watched De Wereld Draait Door.** I know everything and feel dizzy. It’s as if my head is filled with cotton wool. I feel sadness, impotence, a head ache. There is no point to this. I know everything, but understand nothing. I know everything, but I haven’t reflected. I know everything, but I haven’t done anything.

January 8th, 5.00 PM

I decide to make something. A small tribute for the victims. To show that I’m angry and sad. That I admire those who dare to say what they think. I find it difficult enough to speak my mind without a gun to my face.

Good, I will make something. But what? I wish I could write satire. Or draw a cartoon that’s spot-on. I try to think of a good joke, but my sense of humour is nowhere to be found. I decide to write something.

January 8th, 8.00 PM

My cynical side starts to take over. Why do I want to do something now, while I usually put aside the newspaper and continue my life? What difference does it make? By the way, what’s up with all this navel-gazing? This is not about me.

January 8th, 9.00 PM

As with the shower, good ideas often come up in conversations with my mom. We talk on the phone for an hour. About that doing nothing is also a choice. That you sometimes do something in order to do something, even if it has no direct consequences. That everyone can do something in their own way: a demonstration, a drawing, a thought. That we’re already doing something, simply by talking about it.

January 9th, 11.00 AM

I’ve just finished my tribute. I feel blessed to live in a country where I’m allowed to create whatever I want. Where I can think and have doubts, be cynical and idealistic. I praise those who use and defend these freedoms to the extreme.

Je suis Charlie.

* The Volkskrant is one of the major Dutch newspapers.

** De Wereld Draait Door is a daily talk show on Dutch public television.

Je suis Charlie. Que dois-je faire? (Dutch)

Na de aanslag bij Charlie Hebdo, wil ik iets doen. Maar wat is dat eigenlijk: ‘iets doen’? Dagboek van een worstelaar.

Stephen Strydom (via @stephen_strydom)

7 januari, 12.30 uur

Ik hoor op de radio dat er een aanslag is geweest op Charlie Hebdo. Charlie Hebdo? Nooit van gehoord. Er is nog veel onduidelijk. Ik zou willen zeggen dat ik meteen aan radio, tv en internet geplakt zit, maar dat is niet waar. Ik ga de stad in.

7 januari, 21.00 uur

Ik kom thuis en begin meer te lezen over de aanslag. Het schokt me, maar het raakt me niet diep. Ik leef in een wereld waarin nieuws entertainment is geworden en entertainment nieuws. Bijna niets raakt nog diep. Ik probeer de bovenstaande tekening te tweeten. Het WiFi signaal is te zwak. Ik ga naar bed en besluit het morgen nog een keer te proberen.

8 januari, 8.00 uur

Zoals vaker, komen de beste gedachten onder de douche. Dit is niet oké. Ik móet iets doen. Al is het maar om mezelf wakker te schudden. In een tijd waarin alles snel gaat, besluit ik het meest waardevolle te geven dat ik heb: tijd. Ik ga alle tijd nemen om alles te lezen, kijken, luisteren wat ik kan vinden over #CharlieHebdo.

8 januari, 16.00 uur

Ik heb de hele Volkskrant gelezen, Twitter uitgeplozen, DWDD gezien. Ik weet alles en voel me duizelig. Met een hoofd vol watten loop ik doelloos door de stad. Ik voel verdriet, machteloosheid, hoofdpijn. Dit heeft geen zin. Ik weet alles, maar begrijp niks. Ik weet alles, maar heb nog niet nagedacht. Ik weet alles, maar heb nog niks gedáán.

8 januari, 17.00 uur 

Ik besluit iets te maken. Als een klein standbeeld voor de slachtoffers. Om te laten zien dat ik boos en verdrietig ben. En dat ik mateloos veel bewondering heb voor mensen die durven te zeggen wat ze denken. Ik vind het al moeilijk genoeg om te zeggen wat ik denk zonder een gun op me gericht.

Goed, ik ga iets maken. Maar wat? Ik wou dat ik satirische stukken kon schrijven. Of een rake cartoon kon tekenen. Ik probeer een goede grap te bedenken, maar ik ben een grappenmaker van likmevestje. Ik besluit iets te schrijven.  

8 januari, 20.00 uur

Mijn cynisme neemt de overhand. Waarom wil ik nu opeens iets doen, terwijl ik vaak genoeg de krantenpagina omsla en doorga met mijn leven? En wat verandert er eigenlijk als ik iets maak? En wat ben ik trouwens aan het navelstaren. Dit gaat niet over mij.

8 januari, 21.00 uur

Net als met de douche, komen goede gedachten vaak in gesprek met mijn moeder. We bellen een uur. Over dat niets doen ook een keuze is. Dat je soms iets doet om iets te doen, al heeft het geen direct gevolg. Dat iedereen iets doet op zijn eigen manier: een stille tocht, een tekening, een gedachte. Dat wij ook al iets doen, puur door hierover te praten.

9 januari, 11.00 uur
Mijn standbeeldje is af. Ik voel me gezegend dat ik in een land leef waar ik dit mag maken. Waar ik mag nadenken en twijfelen, cynisch en idealistisch zijn. Hulde aan iedereen die deze vrijheden tot het uiterste gebruiken en verdedigen.

Je suis Charlie.

Natural resources: blessing or curse?

This blog post appeared in Dutch on the Oikocredit Netherlands website.

Ghana, Uganda and Tanzania have recently discovered oil, gas and minerals. While a blessing at first sight, history teaches us that many countries hardly benefit from their natural resources. Nonetheless, a few countries (such as Norway) have experienced spectacular economic growth. Why do some countries succeed while others fail?

Source: The Economist 

I’ve just spent a month in Bergen, Norway, for work. While I was staring out of the bus window on the way to university, a thought sprung to my mind: “If only I had been born here.” Norway is a welfare state pur sang, which takes good care of its citizens. While the social safety net in The Netherlands is being torn down, Norwegians don’t need to worry when they get sick, unemployed or pregnant.

My enthusiasm is being supported by official statistics such as the UN Human Development Index, which has ranked Norway first since 2000. It is also one of the richest countries in the world, which is mainly a result of oil and gas exports. “Yeah, that’s easy” you might think. Of course you take good care of your people if you have a money tree growing in the backyard.

Intuitively, it seems a blessing to find oil or the like in your soil. However, Paul Collier shows in his book ‘The Bottom Billion’ that this is not always the case. Countries with natural resources do not automatically perform well socially and economically. Even more, they often perform worse than countries without such richness. Collier calls this the ‘Natural Resource Trap’ (also commonly called the ‘resource curse’), in which conflict becomes more likely and governments are less accountable. In addition, economic problems are looming, such as the Dutch disease (and, no, this is not an allergy for Gouda cheese).

Norway managed to avoid these problems by investing the oil money in the Government Pension Fund Global (or Oil Fund). With 760 billion Dollars in the bank, it is the largest of its kind and an important international investor. The Oil Fund invests in a careful manner. First of all, money is only invested abroad in order to keep the Norwegian economy from overheating. Secondly, an ethical committee checks whether investments are directed at ‘proper’ organizations, which do not sell weapons, violate human rights or harm the environment (click here for a list of excluded companies).  

Countries like Sierra Leone, Nigeria and Congo fared a lot worse: their discovery of diamonds, oil and minerals only helped the political elites. Why did it work out in Norway, while so many others fell prey to the resource curse? An obvious explanation is that Norway is a rich country and therefore better organised. But then we would forget that Norway’s wealth is a consequence – rather than a cause – of its resource management. For years, it was one of the poorest countries in Europe. Only in the 1960s did the economy start to grow as a result of the discovery of oil. By the way, also non-European countries – such as Chili and Trinidad and Tobago – avoided the resource trap. Hence, geographical and cultural factors cannot be the sole explanation of the Norwegian wonder.

So what is the explanation of Norway’s success? This question touches upon one of the most important questions in economics: Why are some countries poor and others rich? Daron Acemoglu and James Robinson give a compelling answer in their book ‘Why Nations Fail’. In their view, economic success is not determined by culture or geography, but by political and economic ‘institutions’ in a country. Institutions can be regarded as laws and practices in a country. These institutions don’t magically appear: they are manmade and often the result of a long history.

Institutions (or the lack thereof) affect how a country deals with the profits of its natural resources. Norway has democratic institutions, which means that political leaders can be held accountable for their decisions. As a result, revenues are being invested responsibly and to the benefit of all Norwegians. Such institutions lacked in other countries, which enabled officials to loot without consequence.

Countries like Ghana, Uganda and Tanzania are now standing at a crossroads. They have just discovered an abundance of minerals, oil or gas. Will they choose the road towards Norway or will they go towards Sierra Leone? Let’s hope that their institutions will push them in the right direction.  

The faces behind the numbers

This post appeared in Dutch on the Oikocredit Netherlands website. 

Today is Blog Action Day. On this day, people around the world post blogs to draw attention to a designated theme. This year: inequality, a topic that I focus on in my research.

I travelled to Bolivia two years ago. During my stay I interviewed individuals about their experience with inequality. I was perfectly prepared. I had carefully drawn diagrams representing different income distributions on my computer. Identical rectangles pieced together into a pyramid or an hourglass. The questions – thanks to my language course – were translated to Spanish. And, of course, I had read all the relevant academic papers. I was ready.

My host family in Tarija, a small town close to the Argentinian border, warmly welcomed me. I went to a wedding, celebrated New Year’s Eve, and got acquainted with all the aunts and uncles. The culture shock that I had expected didn’t come. The heels were a bit too high for my Dutch feet and the language was more melodious than my own. But with Teresa, the host family’s daughter, I chatted as I would with my friends at home. We shared experiences, enjoyed the same food, and our jeans looked alike.

Shock

The biggest shock I experienced in those first days was that I sometimes felt relatively poor. Like when Jorge – member of the local Rotary Club – showed me a new Santa Cruz neighbourhood. Ten years ago it had been a deserted area, now it was filled with villas, fancy cars, and high fences. Or the time that I was invited for a lunch in an old colonial house filled with antique furniture. When we had finished our starters, my host rang a copper bell. A second later, the two helps entered to clean the table and serve the main dish.

The fifty-eight year old woman Venita broke my bubble. Equipped with a stack of questionnaires, I had arrived at the office of Mujeres en Acción. This organisation aims to empower women that work as household help. Since recently this occupational group was legally entitled to the minimum wage. However, in practice little had changed.

Venita was shorter than me by twenty centimeters. She was dressed in a gray sweater and a worn pair of jeans. “How happy are you on a scale from one to ten?” “One” she answered. She looked fragile and I wondered whether I should just leave her alone. “My employer pays me 200 bolivianos (23 euro) per month. I don’t dare to ask for more. They will probably fire me if I do. And I have no other place to go. I am too old. I live outside in a small tent.”

Rich and poor

“Next, I am going to ask you some questions about the distribution of money between rich and poor in Bolivia” I continued. I glanced at the abstract diagrams I had designed in The Netherlands. Venita could neither read nor write. I cursed at myself. How was she supposed to understand these collections of rectangles? But before I could ask my first question, she started to talk. “Let me tell you how Bolivia works. There are many poor people and very few rich. There is nothing in between.” She straightened her back. “And it only gets worse. People are not to be trusted, let alone the government. Many words, but no actions.” She looked at me with her dark eyes. I bit my pen and flipped through the questionnaire. Venita had just, without realising, answered two pages of questions.

I sometimes think of her when I am gazing at averages, standard deviations or regression coefficients. Because Venita hides behind these numbers. Or Jorge. Or Teresa. People who sometimes taught me more than a dozen academic papers. People who gave faces to abstract concepts. People who answered questions that I could not have thought of. It is their voice that I want my research to echo. 

How Nigeria became twice as rich overnight

This post appeared in Dutch on the Oikocredit website.

One Sunday in April, something remarkable happened: all of a sudden Nigeria became almost twice as rich. The Nigerian statistical agency had recalculated the official statistics and the GDP turned out to be 89% higher than previously thought. Overnight, Nigeria had become the largest African economy, surpassing South Africa.

www.photocontestinsider.com/2013/04/winners-of-the-malaria-photo-contest-announced

Had someone messed with the numbers? After all, companies and other parties have an interest in a larger economy. For years, South Africa had been the African country to invest in; this revision could divert investors’ attention from South Africa to Nigeria. However, economists seem to agree that not the new, but the old statistics were unreliable.

The old statistics could not be trusted because Nigeria was using severely outdated methods for its national accounting (read a more detailed explanation here). This is not just a Nigerian problem: Morten Jerven writes in his book  Poor Numbers that African statistical agencies generally lack people and knowledge, causing them to publish inaccurate numbers. It is not only economic statistics that are often of low quality in Africa, but also other types of data. For example, education and health statistics are often incorrect.

Why should we care about good data? Isn’t that a problem for number fetishists in rich countries? Aren’t there more urgent problems in Africa? It’s probably not the sexiest topic, but data quality is essential for poverty reduction and development. Without good data it is impossible to know where money should be invested, how health care is doing, and what the impact is of a new education policy. Without good data, new policy measures are merely shots in the dark.

Claire Melamed mentions the example of malaria. Malaria is one of the foremost causes of death in poor countries. Nevertheless, good data is scarce. To fight the disease effectively it is important to know which areas are confronted with malaria, how many patients are there, and what is the quality of local healthcare facilities. Moreover, the results of eradication programs can show what works and what doesn’t. For example, should mosquito nets be free or is it better if people pay for them? (Answer: hand them out for free.) Such knowledge doesn’t fall from the sky: local organisations report figures or special teams collect the information needed. This costs money, but such investments have high returns: less people fall ill, less people die.

So how can data quality be improved? In order to figure that out, it is key to understand why statistics are unreliable (and sometimes completely absent) in African countries. First of all, there is a lack of resources. Jerven tells about a visit to the Zambian statistical bureau, where one man is responsible for the entire national accounting. “What happens if I disappear?” he wonders. (To contrast, ninety-nine employees work at the national accounting department of the Dutch statistical agency.) Secondly, perverse incentives sometimes encourage organisations to report wrong numbers. A recent article by Justin Sandefur and Amanda Glassman shows that governments exaggerate the number of vaccinated children in order to receive more donor money. Or schools report higher enrollment figures, because the administration pays them per student. 

Data quality can improve by tackling these two causes. There are initiatives, such as Paris21, that focus on enhancing ‘statistical capacity’ of developing countries by giving money and training. However, that doesn’t solve the problem of wrong incentives, which requires fundamental changes in the way development progress is rewarded.

On that Sunday in April Nigeria showed that it is indeed possible to produce better data. Of course, better data is a not an end in itself. The poor man in a Lagos slum didn’t see his income double overnight. Nor did the ill woman in the countryside all of a sudden have access to a better hospital. Only if good statistics are actually used for better policies, can they make a difference.