It’s commonly accepted nowadays that a multitude of causes determines whether a country is relatively rich or poor. The fact that I’m currently writing post number 61 in this series points in the same direction. However, this means that it’s still possible for a particular cause to be dominant in certain countries, outweighing other existing effects. Some focus on institutions for example, others on geography. Let’s have a look at geography, and more specifically at the argument made by Jared Diamond. He cites some geological, geographical and climatological facts that do seem to have a large effect on national prosperity in certain countries:
- Tropical climates are notoriously unhealthy. There are more parasitic diseases in the tropics because the temperatures are never cold enough to kill parasites. Carriers of diseases, such as mosquitoes and ticks, are also far more diverse in tropical than in temperate areas. Furthermore, tropical diseases – compared to other diseases – are more difficult to combat with effective vaccines. There’s still no vaccine against malaria for instance. Disease is obviously a drag on economic growth: when large parts of a population are sick for extended periods of time, they are unable to work and trade efficiently. Furthermore, disease leads to high fertility rates – as an insurance against infant mortality – which in turn removes many women from the economy for a substantial part of their productive lives.
- Agricultural productivity is on average lower in tropical than in temperate areas. Temperate plants store more energy in edible parts such as seeds than do tropical plants. Plant diseases borne by insects and other pests reduce crop yields more in the tropics than in the temperate zones because the pests are more diverse and not subject to cold winters. The soils are also better in temperate climates (rainfall washes away the nutrients in tropical soils, and these soils are older and not renewed by glaciers).
- Landlocked countries are at an economic disadvantage: if an area is accessible to ships because it lies either on the sea coast or on a navigable river, then trade is easier and less costly: it costs roughly seven times more to ship a ton of cargo by land than by sea. Hence, landlocked countries profit less from the advantages of trade.
- Similar advantages are shared by countries that have abundant reserves of natural resources such as fresh water, forests, minerals, fuels etc. (Although dependence on natural resources can also be a curse).
This being said, there is no overwhelming correlation between national wealth and geographic conditions that supposedly promote wealth: there are countries that are more prosperous than they should be given their geographic endowments, and vice versa. Other factors must therefore play a part, most notably institutions.
More posts in this series here.