more on: rules

Students Studying Under Streetlights

+ Paul Romer


Q: Why are these students studying under streetlights?

A: They don’t have electricity at home, so they go to the airport to study for exams. See the news report describing their situation.

Q: Why do you use this picture in your presentation?

A: All too often, the picture associated with the challenge of development is one of a starving child. This kind of picture may be helpful in motivating giving, but it does not necessarily lead to careful thinking about the forces that hold so many people back. There are, to be sure, desperate cases of people who are truly helpless. But images of extreme deprivation often obscure the fact that many of the world’s poorest residents attempt to help themselves, only to be stymied by bad rules.

Q: What kinds of rules keep people from having light in their homes?

A: Here are some simple examples of rules that can keep people in the dark:

Electricity is provided only by a government-owned firm.
Government employees can’t be fired, regardless of how poorly they do their jobs.
The low subsidized price of electricity for the lucky consumers who have access is determined by political considerations.
Under good governance, the people who want electricity in their homes can easily match up with the utilities that want to provide it to them.

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