Friday, September 30, 2011

The Value of Twitter, Facebook and Blogs To Economic Development

"In Canada there is a small radical group that refuses to speak English and no one can understand them. They are called separatists…In this country (USA) we have the same kind of group. They are called economists."
Nation's Business (via JokEc)

I was reminded of the above when reading this rather plaintive post on the World Bank’s Development Impact Blog:

The perfectionists versus the reductionists

Women perform 66 percent of the world’s work, and produce 50 percent of the food, yet earn only 10 percent of the income….
--Former President Bill Clinton addressing the annual meeting of the Clinton Global Initiative (September 2009)

Impressive, heart-wrenching, charity-inducing, get off your sofa and go do something heartbreaking.

But Wrong...

…But before you think that we are against the pitching of such erroneous or deeply simplistic messages (that are usually wrong), think again. We aren’t.

The simple fact of the matter is that it comes down to the power of rhetoric. You need facts that would fit in a tweet…They’re simple, they’re dramatic, and they just might get you off of the couch…

…People respond more when given emotional triggers tied to simple problems rather than complex representations of worldwide issues. If the aim is to educate people and get them to either think of something new or do something, in a fast-paced busy world you have to catch their attention. And the only way to do that is be dramatic, pithy and damn the consequences.

People who want to get the messages out then have a tough job. First, they have to deal with perfectionist researchers who always want to contextualize and caveat their findings…

…Second, they have little to go with. On the one hand, the literature is increasingly giving up on the ability to make “big” statements linking any specific country investments to growth. On the other, the microeconomic evidence is very geographically concentrated in OECD countries, and particularly the U.S. For those working on low-income countries…the paucity of academic work outside the OECD is just astounding…

So what should we do?…As we all know, candidates go off the deep-end many times and come up with some of most atrocious untruth …that thinking candidates can come up with. But there is some balance. Fact checkers abound, for instant on CNN and on many, many blogs on the internet. Almost every statement that a candidate makes…is debated and fact-checked…

…A system of checks and balances leads to some equipoise in the game of claims and counter-claims that is the battleground between the reductionists and the perfectionists…

…So, part of the role of institutions like The World Bank, should be to encourage groups that take on the duty of verifying the twitter-like feeds that come out of the speeches at the big global forum. Such a group would (a) distill and provide a set of twitter-facts that Very Knowledgeable Persons can use in their Very Important Speeches; (b) would act as a detector of completely incorrect facts so that myths do not perpetrate and would (c) be a living object that takes feedback, requests for fact-checks and comments on facts from users all over the world…

…In the end, this democratized knowledge place may not be the best, and it may not always take us where either the reductionists or the perfectionists want us to go, but it may be better than what we have now. And an informed debate of the issues – where careful empirical work and (fact based) grand statements mix -- can lead to durable policy...

Ok, if you don’t quite get what all the above meant: politicians and activists frequently quote “statistics” and “facts” to make a point and get people thinking and acting the way they want – the reductionists.

But economics, dealing as it does with the doings and interactions of occasionally irrational (in the economic sense) people in an imperfect world, and knowing the limitations of the tools and techniques they have at hand, are never definitive – the perfectionists.

Which is what makes the quote I originally started this post with so apt – it’s sometimes extraordinarily difficult to get across some (actually, many) concepts in economics in plain spoken English. And equivocation is an occupational hazard – all economists have two hands and use them liberally.

Getting back to the subject of this post though, the article is essentially proposing that social media should do for economic development what it has done for politics – act as a check and balance on those competing for public attention and support.

That actually sounds like a tall order too – how many economics blogs are there concentrating on emerging markets? Or to qualify my statement, how many are there in English that are accessible to an international readership? There’s only a handful I know of covering this region, and even less that are regularly updated.

(Here comes the equivocation – I have no idea of the situation on Twitter and Facebook).

So I’ll repeat my own plea of two weeks ago – we need more economists (professional or otherwise) to join the public discourse on emerging markets. As  much as that will probably raise the level of disagreement over policies, or if you prefer lower the signal to noise ratio, it can do nothing but good over the long term. It’s time for academics to stop talking to each other and start talking to society at large.


  1. bro hishamh

    twitter has revolutionize the commodity market,with direct updates from farmers to the commodity traders, info such as yield, weather are being communicated on a real time basis direct from source.

    I believe this evolution will go on further, imagine dealers in a official capacity providing quotes in other OTC markets especially in dealer to client segment...........but the challenge has always been with how to filter the noise

  2. Cool, I didn't know that, though I knew mobile phones were used for that before.

    But I think the point of the article is to have social media function as it does in politics - to enhance the public discussion, while also acting as a watchdog. A democratisation of the economic development debate if you like, though I wouldn't want to confine it to that subject alone.

    I went looking for economic blogs in the region - only found a handful for Indonesia and India (mostly abandoned). Thailand and Taiwan, almost none.