Dr Ahmad tells us that it really does need to be easier to set up mobile telephone towers and repeaters in Bangladesh. That Dr Ahmad is from the industry and presumably would benefit if this were so, is good reason to weigh his assertions carefully. But a reason to consider rather than reject. For however much it might grate to have to admit it, some people are right even though they themselves might benefit from what they say.
The particular point here is that in order to provide mobile telecom coverage, it's necessary to have those towers with the repeaters on them. That's just the way it all works. So, in order to be able to have mobile coverage we need to be able to build the towers.
That's all obvious so far. But there are barriers in the way. Most of them can be solved by that good old economic grease -- some money. Those who have to host the towers can be, and are, paid. But then there's that interface with the wonderfully efficient, speedy, and not at all sloth-like Bangladeshi bureaucracy. Given that this is entirely incorruptible there's no way around just having to wait for that.
So, perhaps we could get mobile coverage extended faster if we reduced the number of pieces of paper required? Which is as far as Dr Ahmad goes and that's fine, that's the case he wants to make.
We should think about whether we actually want to have more mobiles. Because only if we do should we even think of disturbing that time honoured slowness -- sorry, careful consideration -- of the bureaucracy. The answer there is yes, on simple and straight economic grounds.
Something we actually know -- a rarity in this sort of economics, but here we do know, really know -- that mobile phones increase economic growth. The other phrase for that is that they make people, the people generally, richer. The reason is that it allows markets to complete.
In any economy there are people with something who can't find a market for it -- or even know that a market for it exists. The same with people who want something, but don't know whether anyone has any. Or even if the thing itself even exists.
But increasing the information flow through the economy reduces the number of people in that position. More potential transactions take place, more markets complete. The value added is that economic growth, it is that addition of value which makes us all richer.
We've even got a good idea about how much of this happens. The usual number is that when 10 out of 100 people have a mobile then GDP growth rises by 0.5% in a country without a pre-existing landline telephone system that reaches every house. That's not the growth rate increasing by half a percent, that's GDP increasing by half a percent, each and every year, per 10% of the population with a mobile.
The classic paper detailing how this actually happens is about sardine fishermen of Kerala -- only one country away. We'll leave it to those really interested to read that paper -- the basic idea is that radios were too expensive, phones worked as communication methods and catches rose, wasted fish fell, sardine prices fell, and fishermen's profits rose. Pure, unadorned, economic gain for all concerned.
The truly important point here is that we don't in fact know of anything -- no, really, anything, no other technology at all -- that has such a galvanizing effect upon economic growth. Half a percent a year is enormous, massive, in this context. And more than that with 20% with a mobile it's 1% and so on -- although it obviously tails off as we get to 80 and 90% of the population.
In fact, while I'd not care to have to defend the idea, I'm entirely willing to suggest that nearly all of that economic growth attributed to globalization is really from mobile phones and mobile internet (which is said to have about the same effect again). Note that Dr Ahmad also makes this point, but that's just because we're both right.
OK, so, yes, we do want more mobile coverage, we'd like to reduce the bureaucracy that slows this down so, let's go do that. We could then stop there.
But one of the joys of economics, as with any other science, is that specific examples are generalizable. That apples fall out of the tree because gravity explains not just apples, but tamarinds, pears, mangos, and other fruit like objects -- in fact, animals, me when I've had beer and even planets turning in their orbits.
If excessive bureaucracy -- we'll leave the definition of “excessive” alone for now -- slows the roll out of something that makes us richer like mobile phones, well, is this something that is always true of bureaucracy? The answer is yes, yes, it is.
Think of what economic growth itself is for a moment. It's the new things we do. Maybe more of things the old way, maybe new ways of doing those old things, maybe new things altogether. But by definition economic growth -- that thing that makes us richer -- is change.
If we require permission to change then change will be slower. The speed of economic growth is that rise in GDP, how fast is that? 3% a year? 6%? More bureaucracy, more permissions required, by definition again slows that rate of GDP growth. Bureaucracy makes us poorer than we need be simply because it is sand in those gears of the process by which we get richer.
Sure, we've got a long way from mobile phone towers to the generality of how to make ourselves richer overall. But it is true -- firing the bureaucrats works. So, let's do that.
I'm thinking along the lines of a lottery. Pay Tk100 to enter, if you win a junior prize then you get to give one specific amala his marching orders -- in person. Senior prizes would allow the choice of which specific bureaucrat is to be fired. And the grand winner would have a passing out parade for an entire department. Works for me and we'd pay off the national debt at the same time with the profits.
Tim Worstall is a senior fellow at the Adam Smith Institute in London.
