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Is geography destiny?

If people don’t like where they live, they have two options. First, they can move. They can go from places that are too dry, too remote, too disease-ridden, too infertile or too crowded, to a new place where the grass seems greener.

This is the story of the great human diaspora of the past 50,000 years.

Or people can stay where they are and change their surroundings. They can dig irrigation canals, span rivers, control disease-bearing mosquitoes and overcome other obstacles that stand in the way of a better life. This story of man’s efforts to change nature is the underlying theme of civilization.

Either way, the subject is geography, a grand discipline that once stood in the front ranks of academia. But over the years, a whole new array of scientific disciplines arose, pushing geography to the sidelines. Today, many regard geography as old fashioned, evoking images of well-worn text- books and grim schoolteachers discoursing before maps in pastel colors. Others even view geography with suspicion, citing its misuse in earlier times to confirm Eurocentric prejudices such as the one linking tropical climates to "inferior races."

But the value of geography as an explanatory tool cannot be denied. In the hands of serious researchers, data on topography, soils, climate, population distribution and other factors shed light on why human societies have evolved as they have. While the explanations might be tentative and open to debate, they are based on real facts that exist in the real world. The inescapable conclusion is that where people live does indeed make a difference.

But while geography matters, it does not compel, any more than a child’s genetic endowment determines the course of his future development. Geographical conditions do not translate into predictable outcomes. For example, some countries with relatively high living standards are located in tropical areas; a good example is Costa Rica. Conversely, there are poor countries located in the geographically favored temperate zones. The exceptions confirm the fact that the influences of geography act in concert with other factors, such as political institutions, education and technological development. Still, the better a society understands its geographical constraints, the better it will be able to devise strategies to overcome them.

For all these reasons it is worth recognizing that many nations in Latin America do, in fact, labor under a series of geographical handicaps compared to the developed countries in cooler latitudes (See graphic at the top of page). This is the conclusion of the newly released IDB report Development Beyond Economics . A chapter in the report, prepared by John Gallup of Harvard University’s Center of International Development, and Eduardo Lora of the IDB’s Research Department, shows that many of the nagging development problems faced by Latin American countries are the result of location.

But the report also shows how once these problems are clearly identified and put into context, they can be largely overcome by adopting good policies and employing sound technologies.

Standing up to geography. One way a country overcomes geographical isolation is to improve its transportation infrastructure. Better roads, ports, railways and airports provide access to world markets. But a country can only derive full benefits from these investments against a backdrop of good trade and macroeconomic policies. These relationships are well-known, and in fact a central purpose of the IDB over its 40 years of operations has been to finance programs both to build infrastructure and to help reform economies.

Because of the enormous geographical diversity that characterizes many Latin American countries, regions within individual countries can also suffer economic disadvantages. But the authors of the IDB report caution against repeating the mistakes of past development programs designed to help these regions. A major problem is that bringing infrastructure, such as electricity and roads, to isolated areas is very expensive. 
 
These investments can be justified only if local residents can be assured substantial benefits. For example, any attempt to attract industries to an isolated area must recognize the need to overcome the enormous competitive advantages a city has in terms of transportation, communications, skilled labor and the proximity of suppliers of materials, equipment and expertise. The report describes it as a chicken and egg problem—firms will not go where there is no infrastructure and services, but it is not cost-effective to provide these enticements unless many firms make the move. Nobody wants to be the first, and many industrial parks in disadvantaged regions have remained empty. "They were built, but nobody came," state the authors.

Even when carried out on a gigantic scale, regional development programs have not been able to create the complex economic networks needed to lift regions out of poverty. In Brazil, decades of programs to help the poverty-stricken Northeast have yielded very modest results. In 1960, the poorest Brazilian state was Piauí, with a per capita gdp 11 percent of São Paulo’s. In 1995, the gdp of Piauí had risen to only 16 percent of that of São Paulo. So too with the Amazon. Opening up this vast forested area to settlers has caused major environmental damage while producing very limited economic benefits.

Instead of big infrastructure investments, a better answer for isolated areas would be a "basic needs" approach to reducing poverty, according to the report. Programs would emphasize rudimentary feeder roads, electricity and telecommunications—and not just their construction, but their maintenance. Ideally, local people would plan and manage projects to ensure local needs are met.

Turning to the area of health, the report describes the serious problems encountered in breaking the link between diseases and climate. For example, a vaccine for malaria is still years away. Even with millions of malaria-related deaths annually, practically no malaria research is being undertaken by private pharmaceutical firms. Much of the $84 million spent worldwide to combat malaria in 1993 came from wealthy countries concerned about their soldiers overseas.

A major reason for the scant progress achieved against tropical diseases is that even industrialized countries are not willing to carry out the necessary biomedical and pharmaceutical research. Giant international pharmaceutical firms are not interested in developing cures for tropical diseases, because the markets would not be large enough to justify the investment. What to do?

A possible solution has been put forward by Jeffrey Sachs, a Harvard economist and colleague of report author Gallup. Sachs proposes that rich countries pledge a guaranteed minimum purchase price or fixed amount per dose for a malaria vaccine as a way of creating an attractive market for a firm that succeeds in developing it. Similar pledges could spur cures for other diseases.

The need for data. Given the complexity of the links between geography and development, good data are essential for making good policy choices. The need is particularly great in Latin America, where geographical conditions vary markedly from one country to the next and from region to region within each country. As a result, the yield from investments in infrastructure or healthcare initiatives, for example, may differ greatly depending on location. Similarly, sophisticated climate and weather information, as well as geologic data, are needed to focus efforts to prevent natural disasters in areas most at risk.

While some of the region’s larger countries have world-class geographical and statistical institutes (see graphic at the beginning of the page), such massive data collection efforts are just beginning in other countries. In the smaller countries, geographical considerations are still not being factored into spending decisions involving infrastructure, healthcare, urban development or disaster prevention.

Even in countries that do have reasonably good statistical institutions, however, the relevant information often does not trickle down to the levels where it is most needed. While policymakers produce impressive reports, ordinary citizens are often denied timely access to information that could save their lives or their property. People build homes on unstable slopes or too close to river floodplains, for example, because they are not aware of the risks involved. Farmers make costly mistakes in their use of fertilizers, pesticides and irrigation because they lack information on soil composition, insect behavior and historic weather patterns. In the worst cases, vital information that can affect the health and safety of millions—such as data on water contamination, industrial pollution or deforestation along riverbanks—is purposefully manipulated or withheld from the public for political reasons.

In other words, while gathering and processing statistical information is a costly and complex task best suited to central government agencies, these agencies are not always the ones best qualified to put the information to use. To prevent these distortions, the authors of Development Beyond Economics suggest that both access to information and related decision making be decentralized as much as possible. Armed with good information, lower levels of government such as states, municipalities, and even individual communities, are much more likely to make good decisions about housing and productive activities, for example. There is growing evidence that development projects that are designed and implemented at the local level are more likely to succeed than those imposed from above.

How not to decentralize. Are open access to information and decentralized government the key to overcoming geographic disadvantages? That depends. The politics of decentralization in countries with long traditions of centralized government are delicate, and they raise all kinds of questions. Should responsibilities for infrastructure development be vested only in governmental bodies, for example, or can they also be delegated to entities such as regional coffee growers associations or oil companies? Should certain problems be tackled cooperatively by groups of municipalities? And if so, how are the inevitable political rivalries to be managed? Compounding the problem of cooperation at the local level is the excessive number of political jurisdictions in many Latin American countries. Panama, for example, with a population of three million has just 67 municipalities, while El Salvador, with a population only twice as large, has 262.

Political decentralization may be an essential instrument for taming geography, but it is not a simple instrument. The report lists three conditions needed for decentralization to succeed: (1) local decision making must be transparent; (2) the costs of carrying out development projects must be borne by those making them, not by other units of government; and (3) all of the benefits must go to the local community.

But according to the report, in most cases these conditions are not met. For example, although municipal governments are now popularly elected in much of the region, decision making at the town hall level is not necessarily transparent, because patterns of political patronage there can be just as corrupting as they are in national governments. As a result, other kinds of democratically organized groups, such as local producers, must often take the initiative to carry out a project.

The transfer of central government funds to lower jurisdictions also tends to suffer from a lack of accountability. Such transfers are often made automatically on the basis of reported costs, rather than being based on an independent assessment of the quality and reach of the goods or services being paid for. In some countries the amount of federal transfers is based on precedent, as an acquired right, or on a fixed percentage of central government revenues. Finally, lower level governments in many countries have been allowed to borrow funds with little regard to their actual ability to generate revenue and remain solvent.

All of the potential pitfalls of decentralization can be avoided, however. With a better division of responsibilities between central and local governments, improved data collection and dissemination, and the political will to make tough policy choices, countries can work to overcome geographical obstacles and provide better opportunities for their citizens.

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