Progreso, Fundacion BBVA MicroFinanzas
What do you think are the key determinants of a country’s economic and social development?
Life in modern-day society is complex. It requires numerous complementary ingredients and, if just one of them is missing, it will have huge negative effects. Thus, two equally poor countries may suffer from the absence of very different ingredients. This is also why simple recipes, such as education, microcredit or “institutions”, are inadequate answers. But if I had to come up with a synthetic vision to encompass all developing countries, I would say that the secret to development or, in any case, the most difficult ingredient to accumulate is collective know-how or knowing-how-to-do things. The secret to prosperity is technology, but technology is expressed in three kinds of elements: tools or equipment, codes or prescriptions, and know-how or tacit knowledge. While tools and prescriptions are easy to disseminate, know-how is hard to spread, because it is acquired slowly through imitation and repetition, in the same way that we learn to walk or learn a language as children. Nobody learns to play a sport or diagnose a patient by reading about it. It requires years of practice.... Read more about Q&A with Ricardo Hausmann
