By M. Bakri Musa

Chapter 2: Why Some Societies Progress, Others Regress

Next: The Economics of Geography

Modern economists can quantify the effects of geography on the economy. Jeffrey Sachs, now at Columbia University, introduced the concept of GDP (Gross Domestic Product) density, a function of per capita GDP and population density, and showed that coastal, temperate Northern-hemisphere economies have the highest economic densities. They form the core of the economic zones of the world. These areas include Western Europe, the coastal regions of China, Japan, Korea, and the Western and Eastern seaboards of North America.

Geography affects economic development in three major ways. First is through the ease of transporting goods, people, and ideas. Because water transportation is much cheaper and more efficient than overland, coastal areas have distinct advantages over the hinterland. Second, geography affects the prevalence of diseases, especially those involving vectors (malaria and mosquitoes; schistosomiasis and snails). These diseases are endemic in the tropics and hold back economic development by significantly reducing workers’ productivity. Malaysia’s remarkable economic progress is in part attributable to its success in eradicating or at least controlling vector-borne diseases, especially malaria. Read the rest of this entry »