2 16 Book reviews

The final substantive section is Section IV, which has three papers on various aspects of the financing of local economic development. Easily the most disappointing of these is the very thin paper on venture capital, which loses an opportunity to assess the US experiences in using such arrangements as a tool of local economic development. Easily the most interesting is a substantial paper by Robert Gaston on informal entrepreneurial finance and the role of so-called investment ‘Angels’ (an analogy with the rich individuals who finance theatrical productions in the UK). The ‘Angel’ industry is apparently an important source of early-stage financing for new industrial ideas in the US, and one which avoids many of the criticisms now increasingly levelled at conventional venture capital. To the best of your reviewer’s know- ledge, there is no comparable documentation about the ‘Angels’ in the UK to that provided by Gaston. He has assembled a fascinating set of facts about the ‘Angels’, the scope of their activities, their motivations and their incidence within the US population. We learn, for exam- ple, that there are about 4 ‘Angels’ per lo00 of the adult population. A similar study for the UK would be of considerable interest to thousands of prospective new businesses, as well as practitioners in the local economic development business.

The final section provides the final example of the erroneous labelling which seems to characterize this volume. The one paper in the section labelled ‘Putting It All Together’ i s nothing of the sort. It is merely one morecase study-albeit the interesting one of the Mahoning Valley already referred t o - o f the way in which public and private organizations can work together to design and promote important local development projects.

Overall, this is a valuable collection of materials on a topic of considerable and growing importance in the UK as well as the US. The three editors are to be congratulated for assembling the material but not, it would appear, for any particularly substantial effort in providing editorial direction and linkage to ensure that the 18 separate building blocks contribute effec- tively to one integrated story.

ALAN B. ROE Warwick Research Institute

HUNGER AND PUBLIC ACTION Jean Dreze and Amartya Sen Clarendon, Oxford, 1989,373 pp.

This book is a comprehensive review of its field, lucid and well-structured, with a remarkable coverage of the literature. It is an essential reference work for those concerned with research and policy on reducing hunger and poverty. The book has three substantive parts, the fourth and last being a summary.

Part I sets out the concepts used. Broadly there are three clusters of concepts, surrounding ‘entitlements’, ‘capability’ and ‘public action’, respectively. At the risk of oversimplification, ‘entitlements’ are the means or inputs people have to avoid hunger and poverty, i.e. their command over commodities, via their income or their social position within the household or community; their ‘capabilities’ (in size, health, nutritional status, skills, etc.) are the outputs, reflecting their success or failure in averting hunger and poverty; ‘public action’ is the means used by the state, politicians, community and the media, protesting the lack of or risks to the ‘capability’ of the vulnerable, and seeking to protect or promote their ‘entitlements’ by intervening in markets for essential commodities and services.

Around the axis formed by these three concepts turn the three principal arguments of the book, presented in Parts I1 and 111. They are strengthened by well-documented case studies of successful famine prevention in Maharashtra (India), Cape Verde, Kenya, Zimbabwe and Botswana, and successful reduction of chronic hunger and poverty in Sri Lanka, Chile and Costa Rica. The three main arguments are as follows.

First, public action is essential for the reduction of poverty and hunger, whether it is a matter of averting famine or dealing with chronic poverty, whether the country is, in aggregate, wealthy or poor. 1, In the case of famine prevention: where many people’s entitlements are low and unstable,

a system of emergency public assistance is essential to protect their entitlement-most

Book reviews 21 7

effectively through public works employment and public food stocks to stabilize food mar- kets as required. Equally, active local politicians and journalists (at once cooperative and adversarial) are essential to ensure that the famine prevention system is activated and run properly; the mere existence of the system is not enough-it may fail to be triggered, as in the Bengal famine of 1943, or the China famine in 1958.

2. In the case of combating chronic hunger: public action is essential since economic growth alone may only produce ‘unaimed opulence’ accompanied by growing poverty-as in the case of Brazil or South Africa-and may not alter intrahousehold discrimination against females, which still significantly reduces the survival chances of girl babies in India and China. Well-directed public action creates ‘growth-mediated security’, as in South Korean employment promotion through ‘. . . ruthless preservation of highly competitive labour markets . . . education, skills diffusion and training, and . . . supplementary public works’ (p. 189), or as in the extensive social security provisions in pre-Gulf War Kuwait. Even where national wealth and economic growth are relatively low, ‘support-led security’ can reduce levels of undernutrition well below the average for countries at that level of per capita income, as in Cuba, Sri Lanka, Chile, Costa Rica and Jamaica. The point is that growth does not automatically ‘promote entitlements’ of the vulnerable, so public action to reduce hunger and poverty is essential in both the high and low growth situations.

Second, famines are now easily preventable in any part of the world. Given the resources, and these are now available internationally if not nationally, preventing famine (‘entitlement protection’) is relatively straightforward compared to the more complex task of reducing chronic hunger (‘entitlement promotion’). Poor African countries, such as Cape Verde, have been able to prevent famine as successfully as wealthier ones, e.g. Botswana, even where they have had to rely on international food aid rather than their own resources. The key issue in famine prevention is whether the state is committed to provide support in emergencies, both administratively and in response to public agitation.

Third, chronic undernourishment is reduced only by raising ‘capabilities’ through a range of ‘entitlements’ improvements. The synergy between health, nutrition, incomes, skills and initiative requires public action on chronic hunger to be concerned with much more than food intakes.

These are the bare bones of the arguments. The power of the book is in the clarity of the arguments and painstaking coverage of the field, not in theoretical originality: none of the arguments is new-the first being familiar to students of the basic needs literature, the second deriving from Sen’s acclaimed Poverty and Famines (1981) plus much recent work on famine in Africa, and the third from nutrition development writings. For this reason it will probably have less theoretical impact than Poverty and Famines had, while being a far more useful reference work.

This points to the book’s single structural weakness: it is conceptually top-heavy. While ‘capability’ is a useful addition and ‘entitlement’ has proved itself, several other concepts introduced seem redundant: ‘extended entitlements’ (referring to entitlements not legally en- forceable but socially present) is not further used after its definition; ‘endowments’ are not an improvement over ‘assets’; ‘exchange’ is used eccentrically to include the conversion of assets into commodities (thereby incidentally excluding the production process); the distinction made between undernourishment and undernutrition is unclear and unmeasurable; the defini- tion of ‘social security’ as ‘. . . an objective pursued through public means rather than as a narrowly defined set of particular strategies’ (p. 16) begs further specification. Parsimony in constructing new concepts and preparedness to relate to concepts already widely established in the field, notably the set of food security concepts (national, household, chronic, transitory or acute), non of which is mentioned, would have made for a more user-friendly presentation and contributed to developing a common conceptual language.

Two weaknesses in the analysis are apparent. First, the fragility of ‘support-led security’ programmes is neglected; Jamaica and Sri Lanka, for example, had to reduce their social programmes when faced with macroeconomic crises in the 198Os, and in the face of growing population all social security programmes must be ‘growth-mediated’ in the long run. Second, formal early warning systems for famine risk are treated rather lightly, accused of overconcent- ration on food balances and crop failure risks, and portrayed as playing a relatively minor role (compared to press and politicians) in countries with a record of successful famine preven-

2 18 Book reviews

tion. Yet with war now probably the main cause of famine in Africa (notably the Horn and Mozambique), and local administrations unable to function, early warning systems are often the best means available to alert the international community to the food needs of the people trapped by war. This in itself adds a crucial rider to Dreze and Sen’s second argument: famine is now relatively easily preventable anywhere in conditions of relative stabi- lity-a neglected characteristic of all the famine prevention success stories presented-but is not easily preventable under war conditions. Africa has yet to find a way to end its protracted local wars, and the famines that go with them, in Ethiopia, Sudan, Somalia, Chad, Liberia and Mozambique.

If this review has focused on the book’s few weaknesses it should end by reafiirming its overall strength, which lies in the wealth of well reasoned and documented discussion across the range of food security issues, and which defies brief review.

MICHAEL HUBBARD University of Birmingham

THE ECONOMIC THEORY OF AGRARIAN INSTITUTIONS Edited by P. Bardban Clarendon Press, Oxford, 1989,382 pp.

This is an important book to which non-economists should pay good heed (one presumes that economists are already paying heed). It is a collection of excellent papers which can be considered to be part of a general upsurge of ‘new-institutionalism’ across the social sciences. As such, it signals an important groundswell of change amongst economists: the collection both affirms a renewed legitimacy for the study of development in economics and demonstrates a willingness to take institutions and organizations in developing societies seriously. A broad range of topics are considered, including share-cropping and tenancy, labour markets, coopera- tives, credit relations, and, more generally, the insurance dimensions of rural institutions.

The introduction to the book, by Pranab Bardhan, is itself highly stimulating, although the overview of institutionalist approaches in economics is all too brief. In the introduction, Bardhan describes the ‘old institutionalist’ literature (one presumes followers of Veblen and Commons) as being intellectually lazy, in the sense that institutions tended to be invoked as a means of avoiding explanation. Some headway is made in this book towards providing more explanation of how institutions (or are they organizations?) work and the roles which they play in rural developing societies, but Bardhan in particular can equally be accused of laziness. In both his introduction and in his later short note on ‘interlinkage’, important themes are raised, ideas are tantalizingly floated, and are then not pursued.

Non-technical readers should not be completely put off by the fearsome calculus contained in many of the papers in this volume-a friend tells me that it is not as bad as it looks. In any event, it is not necessary for this to be fully comprehended in order to appreciate the story that is being advanced. The story is that it is necessary to look beyond abstracts of ‘the market’, whether perfect or imperfect, and seek to understand the dynamics of interac- tions between people, or, if you prefer, actors. This approach is implicitly very close to that developed by the sociologist Anthony Giddens, who would argue that it is these interactions which themselves generate and reproduce the institutions, and that these institutions synchro- nously affect those interactions. If this line of analysis is pursued, it represents an important epistemological shift for economists, away from variations on structural functionalism, towards a more dynamic and interactionist perspective. However, an early warning should be sounded. It is a potential danger for the exponents of the game theory calculus which is employed in this book, that they may become more fascinated with their techniques than with the subject material which they are exploring. If they do, their debates and discussions on important issues in the study of development will once again become inaccessible to those studying the same subject material from different disciplinary perspectives.

Indeed, this draws our attention to one of the weaknesses of this book, which is that at times it appears to be lamentably ignorant of debates beyond economics. The work of authors such as, for example, Scott, Popkin and Geertz, must be considered to be clearly