Richard Florida
by Richard Florida
Sat Jul 25th 2009 at 10:30am UTC

Failed States and Development

Earlier this week, Foreign Policy released the latest edition of its Failed States Index (via Daily Dish’s Patrick Appel). It’s based on a database of 12 indicators of state cohesion and performance for 177 nations. So my colleague Charlotta Mellander decided to compare it to our Prosperity Institute economic development database which has a wide range of indicators for output, productivity, human capital innovation, life satisfaction, human development, and economic structure. The findings, while not particularly surprising, are nonetheless interesting. FP asks:

“[W]ho (or what) is to blame when things go bad—corrupt leaders, dysfunctional societies, bad neighbors, a global recession, unfortunate history, or simply geography itself? ”

The simple answer that comes from our analysis is development – or lack of it. Failed states not only fail on state cohesion and performance, they also fail on measures of economic development from output or GNP per capita and total factor productivity to human capital, life satisfaction, and more. And failed states apparently lag badly on the transition to knowledge-driven, creative economies.

9 Responses to “Failed States and Development”

  1. Creative Class: Failed States And Development | Lies My Gantt Chart Told Me Says:

    [...] 2009 By jarie I am a sucker for graphs and Creative Class always delivers! This is a wonderful post on how lack development, creativity and education create failed states. You can certainly apply [...]

  2. zoltan acs Says:

    This is really interesting. I would guess that my Global Entrepreneurship Index (GINDEX) would also track reasonable well with the Failed State Index. The Scandinavian countries come out on top here also, icluding Denmark, Sweden and Norway. All of these measures are in one way or another measuring some aspect of development. Of course how to promote the development of successful states remains one of the great puzzeles of the modern world. What seems clear that we have very few rich failed states. All of the above measures are measuring how rich we are, either directly or indirectly. What we should seek to see if we can have poor non failed states. Then we would learn something.

  3. Failed States and Development « Gleektopia Says:

    [...] link: Creative Class » Blog Archive » Failed States and Development – Creative Class [...]

  4. Mike L. Says:

    Israek and the Russian Federation are conspicuous outliers. But the Russian Federation are the more interesting case. They should be a modern, educated, industrial society. They certainly have talented people. What then is the reason? Siberian winters, vodka drinking, defense spending, or … ?

  5. RS Says:

    Very interesting post. Seems that there are several rich failed states but no poor non-failed states.

    It would be interesting to see these figures in deviation from means form so that the 4 groups or quadrants (poor failed, rich failed, poor non-failed, rich non-failed) would be easier to see.

  6. RF Says:

    Thanks for the great comments.

    Zoltan, We did the entrepreneurship index and the correlation was similar to those we showed.

    RS – You make a good point. Maybe we’ll give it a go.

    One think is that working class came out negative but insignificant.

  7. Janet Brown Says:

    Our leaders in Washington must seriously consider new and innovative policies that promote a better, more confident, prosperous, and secure America in the 21st century. One of the things I think we can do to help make that happen is support American businesses and the U.S. Chamber of Commerce (http://bit.ly/oanAT). They’re doing things to reach out and show people that they can get involved, too.

  8. Michael Wells Says:

    Where’s India? The two breakaway Muslim states, Pakistan and Bangladesh, are high on the failed scale. It would be interesting to see where democratic, Hindu, capitalist but poor India falls.

    Just behind the Scandinavians come the English speaking bloc that are organized around English common law — US, UK, Canada, Australia, New Zealand, Ireland. (India is also English speaking, at least the educated classes.)

  9. Michael Wells Says:

    To answer my own question, at least on the Failed States Index, India is at about the level of The Dominican Republic, Turkey and Saudi Arabia, at 77.8. Its competitor for biggest developing economy, China, is at 84.6. The two countries that spun off from British India after Independence are doing much worse, Bangladesh at 98.1 and Pakistan at 104.1. The worst country on the Index is Somalia at 114.7 and the best is Norway at 18.3.