The Guardian Debates the Creation of a Proper Government

LSE scholar John Gray argues that the best forms of government today are relics of monarchy and imperialism and that a stern despot is the safest government. I think Machiavelli would be proud.

The comment section and its rebuttals are even better...

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The point about the bloodiness of nation building is well made. It is a process which has often had little to do with democracy in its early days. The type of monarchy Gray is referring to here, I think, is composite monarchy, whether under the Habsburgs, Britain, or Spain, where a visible central crown diverts attention from ethnic rivalries and competition. Monarchy, when limited, is not incompatible with democratic institutions, as has been obvious to British liberal thinkers from Locke to Mill. It certainly is no less a guarantor of democratic government than republics, as the Dutch, Swedish and Danish will testify.
There have, however, been successful models for incorporating multiple identities outside monarchy, and it is not quite true to state that attempts to frame written constitutions inevitably come unstuck. The United States is perhaps the most obvious model of a durable system, though, as Tocqueville noted, it is probable that the success of democratic models over such a large territory owed much to the separation of religion from government. Switzerland is a more ancient example, where a federal system has provided remarkably stable, but one could argue that this was a result of geopolitical situation in which the component cantons were surrounded by much larger potential enemies.

Excerpt
Well, it could be argued that monarchs are in fact the reason why these "national conflicts" continue in Spain and the UK. There are as many "nations" in France as in Spain (Basques, Gascognes, Occitanes, Bretonnes, Corsicans, Alsatians). France even has the largest Jewish community in Western Europe, a nation in itself. National problems there are politically irrelevant though. "La Republique" has been more successful than any monarch to unite them all as FRENCH.
A better case is the Italian, where "nations" can be found as well. The German speaking Sudtirol, the Greek Speaking Taranto, Sicily, etc. have a "national" character of their own (they eat differently, speak a different language, have a very diverse political history and customs). They even have a nationalist separatist party (Lega Nord), which is politically laughable in comparison to the Spanish nationalist parties or its Scottish and Welsh counterparts.

Financing Secondary Education in Developing Nations

UNESCO and International Institute for Education's massive report on the challenges and strategies for financing secondary education, which are growing due to the lack of investment for secondary schools that is coupled with the growing demand for a high school education due to improvements in primary school enrollment and completion.

The Effects of Education on Macroeconomic Growth

Teulings & van Rens debate the determinants of macroeconomic growth and consider the discrepencies between private and social human capital returns as well as the methods of createing economic growth through educational investments in their paper Education, Growth and Income Inequality.

Highlights from the paper -

Regression studies show that education does not affect the level of an economy’s GDP, but does affect the growth rate.

For every year of education the rate of private return decreases by two percent. There is a paradox since the return to human capital decreases when education levels rise because the relative scarcity of an educated worker becomes less and the relative scarcity of an uneducated worker rises.

This is further explained by the inverse relationship between the aggregate supply of education and its return. For example, only the most complex jobs have the highest return for education. When total levels of education rise, workers are forced to take less complex jobs, which decreases the human capital return.

Social return also does not equal the private return. This is, according the article, only because of endogenous technological progress, which reaches higher returns with higher education levels because of the increased profitability of skill biased technologies. This process reignites the return to human capital, but only on a social level. Consequently, the social human capital return is higher. Corollary criticism is that if the role of education is for technological diffusement, there is a negative return to experience and only newly educated workers should be desired. Also, because private returns to education don’t rise in the long term there is an argument about how much technological progress is skills biased.

Composition effect of education – unequal education results in larger income discrepancies.

Compression effect of education – higher average levels of education result in less income inequality.

On causality between economic growth and education, education most directly affects GDP growth because there is about a 10 year lag between the effects of economic growth on education while the inverse happens much quicker.

The paper raises the question of whether it is effective for a developing nation to attempt to import capital through an industrialization strategy, which was the essential method of growth for the Asian Tigers during the sixties and seventies and is is a strategy currently propulgated by some development experts?

Does the GDP to education lag affect the merits of this strategy?

Is technological progress really skill biased?

Is there an incentive for educated workers to limit others educational opportunities? It would keep their own wages higher and keep other labor inputs cheaper. Is this "descrimination" and does it happen?

How do nations combat the education lag and make investments in education most efficient? Should a developing nation import technology now and invest in education later?

BONUS - Methods of calulating educational returns, i.e. Mincer Function.

Delhi Kid's Bank

In Delhi, street children operate a microfinance bank for their peers. CSM highlights the excellent fiduciary responsibility of lenders and lendees but mentions critisicm that the children who take loans are not improving their long term earnings and graduating from poverty. It seems that the small nature of the student's projects, even by microfinance standards. Whether the income graduation of the Delhi Children's Bank loan recipients is less than adult micro-bankers has not been determined. Critics may just doubt the abilities of youth entrepreneurs more than adults. A more important question may be if the local community and regulators give similar respect to youth micro-businesses.

BBC reports on the same program and offers a few more background details about the bank.