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Submitted by Steve Golub on

Dear Fred

Thank you for this interesting comment. Your point about the importance of social organization is well taken. You are quite right that education by itself will not transform Africa. Indeed, many African university graduates are unemployed, partly due to the failure of the educational system to impart useful skills, as we point out, and also more fundamentally reflecting systemic weaknessess, as we also stress.

It is ultimately the government's responsibility to set the institutional environment in which the private sector operates. The "rules of the game" must be clear and enforceable in order to foster long term investment and job creation. Some authors, such as Acemoglu and Robinson, stress the role of inclusive institutions, i.e., democratic accountability. In some cases, however, as China and the earlier East Asian tigers illustrate, autocratic governments can take an enlightened view on economic development. Either way, a strong "developmental state" committed to fostering economic and social progress is essential in organizing the economy to benefit the wider population rather than the just the elites.