Public Works
Vinod Anand | 09 Aug 2013

Public Works (Vinod Anand) It is hard to find the right balance between investments in public works and other investment. In some countries, expansion of public works is now obviously more urgent than is any other material investment, whereas in some other countries it seems clear that development planning is drawing into public works capital that would be more productively employed in agriculture or manufacturing or other activities. In countries at the lowest level of development, lack of bait I facilities is frequently a major bottle-neck. Transport, communications, water supplies and electric power are necessary, before other types of economic activity can begin to move forward rapidly. lit such a case, development planning is easier since the government can more or less confine its attention to providing these bask facilities. In some other countries which have passed this level, the shortage of capital in agriculture and in manufacturing is more acute. There is, however, the danger that, since development planning are made by governments, and since governments are directly engaged in public works and are not, in most cases, directly engaged in other productive industry, some governments tend to consider in detail, the need of their countries for further public works, and to overlook, or to give less attention to, the need of their countries for other productive capital. The end result, in many cases, is that some capital is absorbed into public works which would be more productively employed in other activities. The greatest sufferer is usually small-scale farming. Governments may be aware of the need to provide public works in farming areas, especially roads and, to an extent now increasingly realized, water supplies, conservation works, and electric power. It is however, also important that the capital used directly by the farmer himself should be greatly increased. Much money spent, for I example, on improving highways beyond essential standards would be more productive if it were spent on providing the farmers with better equipment, more good livestock, processing facilities and such. If small-scale agriculture is to be better equipped, as it must be if there is to be substantial economic development, then the provision of capital through government institutions must be greatly multiplied. Yet this is an item for which very little provision is made in most development programs. Public works sometimes also absorb too much capital, not because they are not necessary, but because they are done on too costly a scale. A good government likes to do properly whatever it may be doing, and especially to leave behind it structures which are permanent and outstanding. Most under-developed countries, however, cannot afford the luxury of doing things properly in this sense. What they need is the cheapest structure that will do the job. Frequently, too, what they need is a structure which will be pulled down in twenty or thirty years, rather than a permanent memorial. Capital is so scarce that it should, in general, be spread over many simple structures rather than being concentrated on some outstanding work. The defect of too costly a scale of public works relates to common complaint in under-developed countries that, because development plans are made in the capital city, resources tend to be concentrated on works sited in the capital, or on a few projects that “look good” from the capital. Thus, the road program will provide for a few elegant highways, instead of concentrating on creating a multitude of farm-to-market roads which cannot be demonstrated spectacularly to tourists. Or vast resources will be poured into controlling a single river, where the same money would yield much more if spent on a multitude of wells and small streams. Sometimes these are the right policies; one major work may be more economical than several small ones. We are arguing not for a priori judgment, but for careful choice between alternatives. This is partly an administrative problem. Development planning should geographically decentralized as much as is practicable. The high standards which some under-developed countries set themselves sometimes have also the effect of inhibiting the growth of public works because these works come to be more costly than the government can afford. For example, in pioneer settlement of new lands in the nineteenth century, the settlers often created their own public works for themselves as they went along. With their own hands, and roughly, they built their roads, schools, public buildings, water supplies and other facilities, at a minimum cost. Today, in some countries, governments are expected when opening new lands, to cut down forests, to build good roads, and to provide schools, water supplies and other community needs, before the first settlers move in; and where the government cannot raise the money required for this heavy initial investment, settlement is sometimes held up. Governments are also expected, in many under-developed countries, to pay much higher wages, and to offer much better conditions of work than can be obtained from private enterprise or by working on one’s own land. The construction of public works thus imposes a tax on the community for the benefit of a particular class of government employees. There are some countries where this is a factor holding up development. The difficulties created by excessively high standards can to some extent be avoided by encouraging local communities to create their own public works with their own hands; the villagers, for example, building their own roads, dams, schools and so on, using their own labour, with a contribution from the government to cover the cost of materials and of technical services. Obviously this is possible only for a limited range of public works. But, wherever it is possible it has the merits, not only of financial cheapness, but also of identifying the people with their own development schemes, and of arousing that mass desire for improvement and mass participation in development which is the secret of rapid progress.