Lecture 8 Amartya Sen Development as Freedom: A Brief
Overview
Development as Freedom: A Brief Overview
Development is fundamentally understood as the expansion of real freedoms that people enjoy,
contrasting with narrower views focused solely on economic growth indicators like GNP,
industrialization, or technological advance.
Core Concept: Freedom as End and Means
The central argument posits that freedom serves as both the primary end and the principal means
of development.
● Constitutive Role: Substantive freedoms, such as avoiding starvation, accessing health and
education, and political participation, are integral components of development itself.
● Instrumental Role: Various types of freedom act as means to promote overall human
freedom and contribute to development, often through mutually reinforcing connections.
Five Instrumental Freedoms
Five distinct types of instrumental freedoms are crucial for advancing human capabilities and
fostering development:
● Political Freedoms: Encompass opportunities to participate in public discussion, scrutinize
authorities, express dissent, and choose political leaders.
● Economic Facilities: Refer to opportunities for individuals to utilize economic resources
for consumption, production, or exchange, influenced by market conditions and access to
finance.
● Social Opportunities: Involve societal arrangements for education and health care, which
enhance individuals' substantive freedom to live better and participate effectively.
● Transparency Guarantees: Ensure openness and disclosure in social interactions,
preventing corruption and financial irresponsibility by fostering trust.
● Protective Security: Provides a social safety net, including unemployment benefits, income
supplements, and famine relief, to prevent severe deprivation.
Interconnections and Illustrations
These instrumental freedoms are deeply interconnected and complement each other,
strengthening their joint importance in the development process.
● Life Expectancy vs. GNP: Countries like Sri Lanka, China, and India's Kerala state
demonstrate significantly higher life expectancies than richer nations (e.g., Brazil, South
, Africa) despite lower per capita GNP, highlighting the importance of social arrangements
over mere income.
● Market Freedom: The freedom to exchange goods, words, and gifts is a basic liberty, not
merely a means to economic growth; denying access to labor or product markets
constitutes unfreedom.
● Democracy and Famine Prevention: Political freedoms, including democratic governance
and a free press, provide strong incentives for governments to prevent famines, which
have historically not occurred in democracies.
● China-India Contrast: China's pre-reform investment in basic education and health care
provided a strong social preparedness for marketization, leading to widespread economic
expansion, unlike India's slower progress due to social backwardness.
Growth-Mediated vs. Support-Led Development
Two distinct processes explain rapid mortality reduction and improved living conditions:
● Growth-Mediated Process: Achieved through fast, broad-based economic growth that
expands social services and reduces poverty.
● Support-Led Process: Works by prioritizing social services like health care and basic
education, even without rapid economic growth, as exemplified by Kerala, Sri Lanka, and
pre-reform China.
Figure 2.1 illustrates that countries like Kerala, China, and Sri Lanka achieve high life expectancy
despite lower GNP per capita compared to countries like Brazil or Gabon. Figure 2.2 shows that in
England and Wales, the most significant increases in life expectancy occurred during the two
World Wars (1911-21 and 1940-51), periods of slow GDP growth but increased social sharing and
public support for health and nutrition, as depicted in Figure 2.3.
Conclusion
The freedom-centered approach emphasizes that individuals are active agents in shaping their
destiny, not passive recipients. Development requires a plurality of institutions, including
democratic systems, markets, and social provisions, to strengthen and safeguard human
capabilities.
Lecture 8 Dwight H. Perkins Government Intervention vs.
Laissez-Faire in East Asian Development
Introduction to East Asian Development Strategies
East Asian economies experienced rapid growth driven by policy changes and economic
management, not solely by increased savings and investment. This analysis compares
, government intervention and laissez-faire approaches in Northeast Asia (Korea, Taiwan, Hong
Kong, Singapore) and Southeast Asia (Malaysia, Thailand, Indonesia, Philippines).
Japan's Pioneering Interventionist Model
Japan's industrialization, starting in the late 19th century, featured significant government
involvement. Early state-owned enterprises were largely unsuccessful, but the state actively
guided private industrial development.
● Zaibatsu/Keiretsu: Large conglomerates with close ties to government and state-owned
banks.
● Government Influence: Ministry of International Trade and Industry (MITI) provided
leadership, controlled foreign exchange, restricted imports, and fostered
business-government ties through systems like amakudari.
● Post-WWII: A modified prewar system re-emerged with Keiretsu and MITI guidance,
despite U.S. occupation efforts to dismantle it.
South Korea's Evolving Industrial Policies
Korea's development path involved a succession of industrial and trade policies, influenced by
Japan but uniquely evolving.
Early Import Substitution (1953-1960)
● Syngman Rhee Era: Policies like an overvalued exchange rate and trade prohibition
with Japan led to import-substituting industrialization, with the economy largely
dependent on foreign aid.
Export-Led Industrialization (1960s)
● Park Chung Hee Era: Shift to export-led growth, driven by the need for foreign
exchange and inspired by Japan.
● Key Reforms: Devaluation of the Korean won, normalization of economic relations with
Japan (1965), interest rate reforms, and direct subsidies for exporters.
● Government-Business Collaboration: Monthly presidential meetings with industrialists
addressed bureaucratic roadblocks and set export targets. Foreign direct investment
was largely blocked.
Heavy and Chemical Industry Drive (1970s)
● Targeted Intervention: Government actively targeted specific heavy industries (steel,
machinery, petrochemicals) and companies (e.g., Hyundai).
● Support Mechanisms: Subsidized loans, infrastructure in industrial parks, tax
incentives, and temporary monopolies.
Overview
Development as Freedom: A Brief Overview
Development is fundamentally understood as the expansion of real freedoms that people enjoy,
contrasting with narrower views focused solely on economic growth indicators like GNP,
industrialization, or technological advance.
Core Concept: Freedom as End and Means
The central argument posits that freedom serves as both the primary end and the principal means
of development.
● Constitutive Role: Substantive freedoms, such as avoiding starvation, accessing health and
education, and political participation, are integral components of development itself.
● Instrumental Role: Various types of freedom act as means to promote overall human
freedom and contribute to development, often through mutually reinforcing connections.
Five Instrumental Freedoms
Five distinct types of instrumental freedoms are crucial for advancing human capabilities and
fostering development:
● Political Freedoms: Encompass opportunities to participate in public discussion, scrutinize
authorities, express dissent, and choose political leaders.
● Economic Facilities: Refer to opportunities for individuals to utilize economic resources
for consumption, production, or exchange, influenced by market conditions and access to
finance.
● Social Opportunities: Involve societal arrangements for education and health care, which
enhance individuals' substantive freedom to live better and participate effectively.
● Transparency Guarantees: Ensure openness and disclosure in social interactions,
preventing corruption and financial irresponsibility by fostering trust.
● Protective Security: Provides a social safety net, including unemployment benefits, income
supplements, and famine relief, to prevent severe deprivation.
Interconnections and Illustrations
These instrumental freedoms are deeply interconnected and complement each other,
strengthening their joint importance in the development process.
● Life Expectancy vs. GNP: Countries like Sri Lanka, China, and India's Kerala state
demonstrate significantly higher life expectancies than richer nations (e.g., Brazil, South
, Africa) despite lower per capita GNP, highlighting the importance of social arrangements
over mere income.
● Market Freedom: The freedom to exchange goods, words, and gifts is a basic liberty, not
merely a means to economic growth; denying access to labor or product markets
constitutes unfreedom.
● Democracy and Famine Prevention: Political freedoms, including democratic governance
and a free press, provide strong incentives for governments to prevent famines, which
have historically not occurred in democracies.
● China-India Contrast: China's pre-reform investment in basic education and health care
provided a strong social preparedness for marketization, leading to widespread economic
expansion, unlike India's slower progress due to social backwardness.
Growth-Mediated vs. Support-Led Development
Two distinct processes explain rapid mortality reduction and improved living conditions:
● Growth-Mediated Process: Achieved through fast, broad-based economic growth that
expands social services and reduces poverty.
● Support-Led Process: Works by prioritizing social services like health care and basic
education, even without rapid economic growth, as exemplified by Kerala, Sri Lanka, and
pre-reform China.
Figure 2.1 illustrates that countries like Kerala, China, and Sri Lanka achieve high life expectancy
despite lower GNP per capita compared to countries like Brazil or Gabon. Figure 2.2 shows that in
England and Wales, the most significant increases in life expectancy occurred during the two
World Wars (1911-21 and 1940-51), periods of slow GDP growth but increased social sharing and
public support for health and nutrition, as depicted in Figure 2.3.
Conclusion
The freedom-centered approach emphasizes that individuals are active agents in shaping their
destiny, not passive recipients. Development requires a plurality of institutions, including
democratic systems, markets, and social provisions, to strengthen and safeguard human
capabilities.
Lecture 8 Dwight H. Perkins Government Intervention vs.
Laissez-Faire in East Asian Development
Introduction to East Asian Development Strategies
East Asian economies experienced rapid growth driven by policy changes and economic
management, not solely by increased savings and investment. This analysis compares
, government intervention and laissez-faire approaches in Northeast Asia (Korea, Taiwan, Hong
Kong, Singapore) and Southeast Asia (Malaysia, Thailand, Indonesia, Philippines).
Japan's Pioneering Interventionist Model
Japan's industrialization, starting in the late 19th century, featured significant government
involvement. Early state-owned enterprises were largely unsuccessful, but the state actively
guided private industrial development.
● Zaibatsu/Keiretsu: Large conglomerates with close ties to government and state-owned
banks.
● Government Influence: Ministry of International Trade and Industry (MITI) provided
leadership, controlled foreign exchange, restricted imports, and fostered
business-government ties through systems like amakudari.
● Post-WWII: A modified prewar system re-emerged with Keiretsu and MITI guidance,
despite U.S. occupation efforts to dismantle it.
South Korea's Evolving Industrial Policies
Korea's development path involved a succession of industrial and trade policies, influenced by
Japan but uniquely evolving.
Early Import Substitution (1953-1960)
● Syngman Rhee Era: Policies like an overvalued exchange rate and trade prohibition
with Japan led to import-substituting industrialization, with the economy largely
dependent on foreign aid.
Export-Led Industrialization (1960s)
● Park Chung Hee Era: Shift to export-led growth, driven by the need for foreign
exchange and inspired by Japan.
● Key Reforms: Devaluation of the Korean won, normalization of economic relations with
Japan (1965), interest rate reforms, and direct subsidies for exporters.
● Government-Business Collaboration: Monthly presidential meetings with industrialists
addressed bureaucratic roadblocks and set export targets. Foreign direct investment
was largely blocked.
Heavy and Chemical Industry Drive (1970s)
● Targeted Intervention: Government actively targeted specific heavy industries (steel,
machinery, petrochemicals) and companies (e.g., Hyundai).
● Support Mechanisms: Subsidized loans, infrastructure in industrial parks, tax
incentives, and temporary monopolies.
