By Raymond Erick Zvavanyange
Twitter: @zvavanyanger3
Speed Read
- Economics Professor Thomas Piketty collaborative research presents provocative conclusions to aid our understanding of income, wealth and capital in society.
- Think Tanks in Africa should seriously consider income and wealth creation in designed strategies, programmes, and implementation actions.
- Income and wealth creation are, and should be a part of agricultural transformation in Africa agenda.
- Economics insights should compel think tanks to devise new ideas that impact on society.
As of 2014, there were approximately 6, 618 think tanks in the world. Sub-Saharan Africa, alone accounted for 7, 06% of the global total number of think tanks. South Africa is the thought leader in Sub-Saharan Africa.
According to the Global Wealth Report, the top 1% of wealth holders now own half of all household wealth. The Report also makes a distinction between net wealth and income, which gave rise to a counter finding by one Forbes contributor, who posits that there are really more poor people in America (and Europe) than in China. Africa is not far off in such discussions of poor people, which presents think tanks with an opportunity to chip in on what can be done on the continent as far as income and wealth of its citizens is concerned.
The exact definition of a think tank eludes us. However, think tanks are strategic organisations that fill in specific information needs and address knowledge gaps for decision-making. Think tanks conduct public-policy research analysis on a range of domestic and international issues. Their key objectives include to inform and educate. Think tanks may be affiliated or independent institutions that are structured as permanent bodies, not ad hoc commissions.[i]
Boosting African economies might depend on an understanding of economics –precisely, income, wealth, and capital. It is also about detailing the connection between economics and Africa and vice versa. Think tanks can play a critical role in the transformation process of Africa by serving as catalyst for ideas and action on key policy issues and bridging the gap between knowledge and policy and governments and civil society. The United Nations community has begun to work on the Sustainable Development Goals (SDGs). SDGs signaled a common global transition to economic, social and environmental progress in the next 15 years, a united and mutually collective front against complex challenges that Africa faces. Think tanks should be among the front liners in interrogating the linkages among income, wealth, and SDGs.
The drive to exploit Earth’s resources to meet the needs and demands of the growing population as well as the urge improve the income and status of smallholder African farmers remains elusive targets. As a matter of fact, wealth and income are highly discussed and controversial issues. Historical data and analysis, the methodology used by the French economist and Professor Thomas Piketty to draw important findings on income and wealth, might give think tank indication as to how income and wealth should be addressed in their strategies, programmes, and implementation actions. Mr. Piketty is the author of the highly acclaimed economics book, Capital in the Twenty-First Century. The economist uses historical changes in the concentration of income and wealth to draw important conclusions.
According to The Economist, Mr Piketty derives a grand theory of capital and inequality using his historical analysis. As a general rule, wealth grows faster than economic output. This concept is succinctly captured in the expression r > g (where r is the rate of return to wealth and g is the economic growth rate). The Economist adds that other things being equal, faster economic growth will diminish the importance of wealth in a society, whereas slower growth will increase it (and demographic change that slows global growth will make capital more dominant). But there are no natural forces pushing against the steady concentration of wealth. Only a burst of rapid growth (from technological progress or rising population) or government intervention can be counted on to keep economies from returning to the “patrimonial capitalism” that worried Karl Marx.
Speaking at an address to the 13th Nelson Mandela Annual Lecture, which took place at the University of Johannesburg’s Soweto campus on 3 October 2015, Professor Thomas Piketty’s among other things, argued:
“What’s important is not to let economists do that; I think it is important to realise that issues of inequality, income, wealth, capital, public debt are not technical issues – these are issues in which everybody must have an opinion because ultimately they are what determine political change.”
Expert knowledge must be brought to bear in decision-making in African agricultural transformation. In the global marketplace of ideas, think tanks need to develop national, regional and global partnerships while creating new and innovative platforms to deliver their products and services to an ever expanding audience of citizens, policy makers, and businesses around the world.[ii]There is progress, though, to agricultural transformation in Africa. This, ultimately should improve the economies of Africa. Closing the digital divide gap in the developing world is central to a vibrant marketplace of ideas. There are already some promising initiatives from which think tanks can improve upon such as getting smallholder farmers connected using digital technologies; strategies for agriculture and agribusiness transformation, as witnessed during a Youth Side Event with strong presence of International Institute of Tropical Agriculture Youth Agripreneurs, Young Professionals for Agricultural Development Africa members and youth leaders at the 1st Africa Agribusiness Incubation and Expo 2015 in Nairobi, Kenya. Hoesung Lee, the new UN Intergovernmental Panel on Climate Change Chief stressed that “he wanted to increase the participation of experts from developing countries, and devote more resources to studying the effects of climate change on global poverty.” The new climate change dispensation means that all associated sectors of the economy should table their concerns. Furthermore, think tanks in Africa can tap intothe income and wealth agenda. I contend that though there are sharp differences in wealth across individuals and countries, it is not too late to explore possibilities on this front. Only the best of think tanks’ that draw upon the emerging issues of domestic and international relevance and impartial in their work is good enough for Africa.
Endnotes
[i]See James G. McGann, “2014 Global Go To Think Tanks Index Report,” Think Tanks and Civil Societies Program, University of Pennsylvania.
[ii]Ibid.