On 2/4/14, the World Bank designated Nigeria as an ‘extremely poor’ country, in the league of India, China, Bangladesh and the Democratic Republic of Congo, where 66% of the world’s extreme poor reside. I felt sad at that categorisation but Dr Ngozi Iwealla had asked us not to worry since being large also involves having a large dose of everything, including poor people and that India, has the highest concentration of poor people in the world. In effect, our extreme poverty has to do with our large population. There has been a lot of argument about Nigerians over-population and whether it is an asset or a liability. Well, if we borrow from Snowden & Boone [2007] the exact population of Nigeria exists at the fourth level of uncertainty, the realm of unknowables! Furthermore, whenever people say that Nigeria is overpopulated, I usually wonder whether it is in absolute terms, relative to land-mass or income or vis-à-vis other countries like Chad or China. Today however, I want to focus on the nexus between population, comparative advantage and affluence.
On 11/3/14, Professor S.A Tella, delivered the 66th Inaugural Lecture at OOU titled ‘The Affluent Society: Can Africa Make it’. The title is taken from The Affluent Society, a book of all times written by J K Galbraith in 1958. (Professor Tella has had the unique honour of being sacked twice from OOU; first for ASUU activism and second for academic activism, when he argued that Ogun State should not go to the bond market in the last days of Daniel’s administration). Galbraith had written about the post WW2 affluence of the US society and ostentatious demands generated by advertisers and proposed the elimination of poverty, government investment in public schools and the growth of a new class of teachers, professors, surgeons and other professionals. Moving beyond Galbraith, Tella posited that affluent societies start from Rostow’s ‘Drive to Maturity’ stage of development, when modern technology is applied to its resources leading to a sustainable and irreversible growth leading to high savings, investment, income, skilled labour, entrepreneurial class and ending up in the age of high mass consumption. At that stage, there is increased demand for exotic goods, consumer durables and leisure while the countries have become high income countries.
Tella argued that in the present, G8 countries exemplify the affluent societies and they are characterized by high gross national income, personal savings and domestic production ; a market economy with high consumption of industrial goods, equitable distribution of income, and sustained improvement in material wellbeing. They also have high human development index. Unfortunately, Nigeria and other African countries are at the opposite end of the spectrum: poor savings, investment and income, income disparity, poor level of production and consumption, weak financial system, high fertility, birth rate, high population, high infant mortality and low life expectancy. In effect, Nigeria, and other African countries are far behind other countries in almost in almost all variables that represent good living conditions or affluence while they are enmeshed in everything that connotes poverty. They also dominate the top of the failed states index and the bottom of the global competitiveness index.
For us to join the affluent society, Tella argued that we must use what we have to get what we want through the theory of comparative advantage; the mutual benefit that occurs when a party produces a particular good at a lower marginal and opportunity cost over another even when that other party has absolute advantage. It was Ricardo’s theory even though the idea was first mentioned by Adam Smith’ in The Wealth of Nations. So, where is our comparative advantage? That is the intellectual bombshell! Professor Tella declared that our high fertility, procreation and population growth is our comparative advantage and that children are the only ‘items’ we produce with little effort and minimal material and physical inputs from abroad. We should therefore supply the much needed labour to the ageing communities of the world after taking care of our own needs. But for this to materialize, we must give quality education to our citizens for our own transformation and thereafter export excess skills to earn scarce resources for our own development. As a corollary, he suggested that all the birth-control related aids should be channeled to human development so that our huge population becomes an asset, not a liability or nuisance
While others have argued that population is Nigeria’s problem, Tella argues that population is the foundation for a great Nigeria. Already several developed countries are in crises over the scarcity of the quantity and quality of human capital. About 20 years ago, Professor Stough who was on sabbatical from the US to ESUT Business School explained that the US introduced the visa-lottery scheme because they were they faced with imminent acute shortage of human stock. Of course, this trend will only worsen with several birth-containment policies introduced by the so called developed countries. Where now, there are no more women to marry or vice versa; there are no more people to do available jobs while as man marries man and woman marries woman, there would be no further procreation apart from robots and lab-humans. So, they would surely need our brain and brawn. But we have to develop the appropriate model and do it right so that these fellows do not cheat us out of our gold. And the first place to start is to develop the human capital.
Human capital is indubitably the source and core of competitive superiority and this holds true whether the entity is a nation, a non-for-profit organization or a business enterprise. This is because, while other resources are of critical importance, it is people that would acquire, utilize and optimize these other resources to ensure profitable synergy. Furthermore, the way people combine their competences to produce results, offer unique advantages that are neither imitable nor replaceable thereby imbuing organizations with unique, distinctive capabilities that create incomparable values for their customers and other stakeholders. These skills and capabilities are embedded in human capital. That was why my agenda for President Jonathan in 2011started with ‘Soft’ Infrastructure: so as to have a country of people who are healthy enough and have basic and advanced knowledge and skills to be able to appreciate and exploit the extravagant/diverse blessings of the local environment and move on to play meaningful roles at the global levels; technical and entrepreneurial skills within a holistic mindset, not single-minded emphasis to university access; knowledge and skills, not certificates(Nigerian Economy: Options for improving the peoples wellbeing, Zenith Economic Quarterly July,2011, 32-44)
Even Galbraith who wrote the Affluent Society emphasized the criticality of human capital development when he declared almost 60 years ago “Whether the problem be that of a burgeoning population.. or whether it be the depletion of the materials which nature has stocked in the earth’s crust.. or whether it be that of occupying minds no longer committed to the stockpiling of consumer goods, the basic demand on America will be on its resources of intelligence and education. This is also true of Nigeria…
Ik Muo
