Social mobility in Bolivia is finally improving!
Lykke E. Andersen, La Paz, 19 June 2006
There is arguably nothing worse for long run growth prospects in
an economy than low social mobility. Without the possibility of
advancing upwards in society, poor people have little incentive
to work hard and invest in human and physical capital.
Conversely, without investment and hard work, there is little
chance of improving. Thus, the poverty trap.
Maybe the only thing worse than low social mobility, is low
social mobility AND high inequality. This situation reflects a
country with a large gap between the rich and the poor, and
little chance of ever crossing that gap – a situation which by
any standards must be considered unfair. Outcomes are mostly
determined from birth, by factors entirely outside the control
of each individual, whereas subsequent effort and investments
make little difference.
Bolivia has until now been a classic example of low social
mobility and high inequality, a fact that may help explain why
labor productivity and wages have not improved in real terms
over the last 50 years
Figure 1: Social Mobility and Inequality in Latin America
Andersen, L.E. (2001)
“Low Social Mobility in Bolivia: Causes and Consequences for
Development.” IISEC Working Paper No. 03/2001.
But finally things seem to be changing. The rise of a poor
peasant boy to become the President of the Republic of Bolivia
is a sign for all that upward mobility is no longer impossible.
Many of his ministers and executive also come from very humble
would imagine that such examples of upward mobility gives hope
and encourages initiative in many young poor Bolivians, just as
the examples of Theodore Roosevelt, Henry Ford, John D.
Rockefeller, Thomas A. Edison, Andrew Carnegie, Bill Gates and
countless other self-made millionaires inspires the Americans to
work hard, be creative, and take risks for the benefit of
themselves and their country.
Bolivia needs to see many more examples of upward social
mobility – preferably not only in politics but also in business
– in order to give people hope and role models. Examples of
downward social mobility are also important, in order to show
people that there is fairness in Bolivia, that those who are
rich and powerful, but corrupt, are getting punished.
The aid community, which did little to help the rise of Evo
(2), could very well sponsor a book on social mobility in
Bolivia. Not a theoretical, academic piece, but a book full of
biographies of Bolivians that have started from scratch but
become highly successful, who have done a lot of good for the
country and for themselves at the same time.
Bolivia is badly in need of good role models, and such a book
could give them some. The individual biographies in the book
could be published in a national newspaper or read over the
radio, week by week, to make sure that people get to know these
stories and get to see that anybody can do well in Bolivia, as
long as they do not give up before even trying.
“Macroeconomic Policies to Increase Social Mobility and Growth
With one notable exception: The Danish NGO, IBIS, actually
trained and supported Evo Morales, noticing his great potential
as a leader for the Indigenous movement.
Institute for Advanced Development Studies 2006.
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