What is driving the African growth miracle? Capitalism

I love it when you read an abstract that reaffirms everything you know, because I quite like an easy life. “What is driving the African Growth Miracle?” is a paper I have come across again recently, and generally confirms what we know about developing economies, or rather, the process by which they develop.

We show that much of Africa’s recent growth and poverty reduction can be traced to a substantive decline in the share of the labor force engaged in agriculture.”

The agricultural labourers losing their jobs is of course a good thing; it tells us that we don’t need to put as much labour into feeding ourselves, and therefore we can go off and be much more productive elsewhere.

Agriculture doesn’t need that much labour to feed us all, what with mechanisation and more efficient farming methods we can enjoy much more food with half the workforce. This is of course what the definition of increases in productivity means; more for less (and usually a better more).

As many other have argued, one of the great strengths of Capitalism is that it continually improves productivity and thus makes us all richer. Smith said it, Schumpeter said it and no one now disputes it because it is true. More from the paper;

This decline has been accompanied by a systematic increase in the productivity of the labor force, as it has moved from low productivity agriculture to higher productivity manufacturing and services.

Good. Agriculture is a low productivity sector, and industrialised jobs produce more. This not only makes people who live on the African continent richer, but us richer too, as we can trade higher value items, and enjoy the benefits of those trades too. Here is to more exploitation of Africa!

 

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