On the other hand, at least South Africa isn’t as fooked as the Cameroon

On why poor countries are poor, specifically Cameroon from pg. 201 of The Undercover Economist:

What is missing in Cameroon [is] social capital [or] trust. [In poor countries] it’s in most people’s interest to take action that directly or indirectly damages everyone else. The rot starts with government but it afflicts the entire society.

There’s no point investing in a business because the government will not protect you against thieves. (So, you might as well become a thief.)

There’s no point in paying your phone bill because nobody can successfully take you to court (so there’s no point being a phone company).

There’s no point getting an education because jobs are not handed out on merit (and in any case, you can’t borrow money for school fees because the bank cannot collect on the loan, and the government doesn’t provide good schools).

There’s no point setting up an import business because the customs officers will be the ones to benefit (and so there is little trade, and so the customs office is under-funded and looks even harder for bribes).

One simple reform is to cut red tape, allowing small businesses to be legally established, which makes it easier for their entrepreneurs to expand and borrow money. The legal reforms necessary are often trivial; and while they still rely on sensible and benevolent government, all it takes is a single minister with his head and his heart in the right place, rather than hoping for an entire civil service to permanently reform. Another option, and a vital one, is to enlist the world economy for help.

Wiki entry

2008.04.16