International trade is a force of structural change and productive transformation and can therefore promote employment.
Although Sub-Saharan Africa is increasingly attractive to investors, structural transformation and formal job growth remain slow. Industrial surveys in many countries show that some highly productive firms co-exist with many low-productivity businesses. Why do these “productivity islands” not diffuse more rapidly to create the “missing middle”?
In his article – and the book upon which it is based – Seth Kaplan aims to look at the power dynamics and the role of elites and then seeks ways to make the latter work more for the benefit of their countries and populations.
A major reason why less developed countries fail to develop is the structural exclusion of large segments of their population from their economic, social and political development. In my estimation, roughly three billion people—one out of every two in the developing world—face discrimination in how their governments and markets work. This institutional bias has a dramatic impact on access to education, security and the rule of law, and to opportunities to advance.