By Johannes Wegmann
Clara Brandi, (DIE-GDI), commented on the three papers presented on the panel. She pointed out that classifying developing countries is important 1) for analytical purposes and 2) for operational purposes with a view to policy question and ODA distribution. The traditional taxonomy has largely focused on income per capita, thereby disregarding other dimensions of development and development-relevant changes over time. Clara Brandi suggested that the paper by Stephan Klasen et al. should not only stress the advantages of the LDC approach but should also pay adequate attention to the challenges of that category. She mentioned four drawbacks of the approach: 1) There is no broader taxonomy of developing countries, 2) it is rather static, 3) a third of all LDCs are middle income countries by now and 4) it is a binary approach, and hence no gradual differentiation of development exists. Furthermore, she suggested focusing where the LDC approach matters in practice. For example, the LDC approach has a political impact in the context of international trade questions where it is the only country category that is legally acknowledged in the WTO.
Considering the cluster analysis conducted by Rogelio Madrueño-Aguilar and Andy Sumner as well as Sergio Tezanos Vázquez, Clara Brandi raised the question if there are trade-offs between the different country clusters that the analysis generated and that countries or individuals might want to reach. While cluster analysis provides an objective statistical method to come up with a coherent taxonomy, the outcome of the exercise depends on which dimensions of development and which indicators go into the analysis. The authors underlined that the chosen development ends and indicators are based on a close study of development debates over the past decades. This raises the big question: what does development constitute – and what does it mean for a country to be developing? This question should be discussed widely by the scholars, practitioners and stakeholders in the development community.
Clara Brandi concluded with general questions about the taxonomy discussion: What are data needs for better country taxonomies? Why should we focus on a classification system that focuses on countries, rather than regions, cities etc.? How could global development and global challenges be taken into account? How can we better take account of the multidimensional nature of development? To what extent and how could cluster analysis be a solid basis for reforms and go beyond an interesting intellectual exercise? What are the consequences of the ongoing taxonomy debate for the post 2015-agenda discussion?
Questions/Comments from the audience:
The panel discussion generated a lively debate between the audience and the panelists. The audience was in agreement that current country classification approaches are not adequate. The audience raised a number of different questions and comments on the presented papers. For example, Sheila Page (ODI) pointed out that two different topics were treated on the panel. The first topic, introduced by the paper of Stephan Klasen, was the development of instrumental ways in order to classify countries for different purposes: for example, trade, aid and debt relieve. The second topic, dealt with in the other two papers, was the question what development constitutes. She and others in the audience emphasized that developed countries have to be included into a cluster analysis and new country classifications systems more generally – also with a view to contribute to overcoming thinking in terms of a North-South divide. Without including developed countries, an understanding of what developed countries have in common and what developing countries do not have in common would not be possible. In her opinion, the paper of Stephan Klasen should ask how the discussed changes to the LDC category can be adopted. The LDC classification was created for aid purposes but is used in the trade system because it is the only legally accepted one. Obviously, the LDC category is not an ideal classification for trade purposes. This example, however, illustrates the problem of good categories against legally accepted ones. Gabriela Koehler (UNRISD) stressed the political dimension of classification. Developing countries constituted themselves as LDCs as a political act against colonialism. A new classification system therefore should not set up new country-based categories but an issue-based classification system. Richard Jolly (University of Sussex) also stated that developed countries have to be part of the discussion and the analysis, as the classification of developing countries is still an “us”-view of the world. With respect to the recent financial crises, the possibility for a country “going backwards” is important in a cluster analysis in order to understand recent development in advanced economies.
While some in the audience viewed cluster analysis as a promising way forward, others warned against the risk that it might be misused if it is understood to offer policy blueprints for entire country clusters. Many saw the methods as a very good approach for analytical purposes but questioned it as an approach that can and should be made operational. The authors replied that the cluster approach is not meant to provide a general blueprint. They also stressed that the country clusters might offer a promising basis for peer learning among countries that are facing similar development challenges.
Johannes Wegmann is a Student Assistant at DIE-GDI