In chapter 8, Harford discussed reasons why poor nations are poor with Cameroon as an example.

Economists used to think that economic wealth came from a combination of man-made resources
human resources and technological resources. Rich countries suffer from diminishing returns where
a new infrastructure may not help as much as it does in developing countries. However, the speed of
catching up is more important. Some countries such as South Korea used to be poor but with the
integration of technology into their economy, they successfully transformed themselves into a
developing country so what is the problem with Cameroon?

The missing jigsaw is piece is banditry and corruption. Aid from international agency aiming at
supporting the economy goes into the governing elite’s pocket. Bureaucracy and red tape costs is
shockingly high which slow down entrepreneurship spirit in the country as well as incentive to
invest. Marcus Olson’s theory of self-interested dictatorship states that the dictator would keep the
economy functioning and flourish in the short run in order to steal and exploit it in the long run but
in fact, poor and corrupted government don’t have enough knowledge to keep the economy running
well at first hand, which more clearly explain why the country is even poorer.

The world worst library is an evidence of money spent wastefully just to serve the reputation of the
principal. It is a devastating critique of “expert aid agencies” planning infrastructure changes and
other useless things in chronically poor nations. As Harford states, “This Nepalese example is yet
another demonstration that if a society cannot provide the right kind of incentives to behave
productively, no amount of technical infrastructure can save it from poverty”.

But there are some chances for development. Red tape should be cut to allow small businesses to
establish but a new transparent and honest government is much needed. They can also enlist world
economy to help in terms of cheap raw materials and loans from international banks.