Atlas Network President Matt Warner was a recent guest on the Cato Daily Podcast to discuss new trends in economic development, foreign aid, and the role think tanks can play in resolving what Warner calls “the Outsider’s Dilemma” that lies at the heart of the global effort to end poverty.
Warner pointed out that after decades of disappointing and sometimes embarrassing results, many economic development and aid experts are arguing for new strategies to increase donor country sensitivity to local culture and to take more seriously the complexity inherent in any interventionist scheme led by outsiders.
Warner argues, however, that despite being on the right path, foreign-led development will always be problematic and that local think tanks are well positioned to resolve that dilemma. “You have to look at what has worked and what has worked is economic freedom and strong institutions. The missing piece of the puzzle is: How do you have a local vision for change that seeks institutional improvement like better property rights, better legal systems, making it easy to start and close a business. How do you do that while staying faithful to economic freedom and staying rooted in local culture? And, of course, a robust high-functioning local think tank is well positioned to do that in a way that not much else is.”
Warner cited the explosion of think tanks promoting economic freedom the last two decades and gave examples of some of the institutional improvements think tanks are achieving that directly affect low-income communities in positive ways.
“It’s not going to be from the World Bank or USAID that the future of economic development is going to come. It’s going to come because of individual people carving their own path to prosperity and they’re going to be able to do that because of improvements in economic freedom and institutions.”
Warner argues the best way to support economic development as an outsider is to support the reform visions of local think tanks who are committed to economic freedom.