Deena Mousa

NEW: If AI erodes paths to growth, like manufacturing and service exports, what can poor countries do? I went through commonly-recommended contenders and came out skeptical that any are a truly comparable growth engine. Is sending people to rich countries the best bet?

This is, of course, sensitive to not only demand but also the politics of migration. And remittances aren't the same as a growing domestic industry; they mostly fund consumption and housing.

NEW: If AI erodes paths to growth, like manufacturing and service exports, what can poor countries do? I went through commonly-recommended contenders and came out skeptical that any are a truly comparable growth engine. Is sending people to rich countries the best bet?

So why migration? Comparable workers (same age, schooling, experience) earn much more in the US than at home. If AI makes rich countries richer while that work stays human, that gap will only widen.

NEW: If AI erodes paths to growth, like manufacturing and service exports, what can poor countries do? I went through commonly-recommended contenders and came out skeptical that any are a truly comparable growth engine. Is sending people to rich countries the best bet?

Data centers look like an opening, since the US is blocking them amid local opposition. But for poor countries they mostly aren't exports: 80%+ of African data already sits abroad, a hyperscale campus hires ~150 people, and the margins go to the operator.

NEW: If AI erodes paths to growth, like manufacturing and service exports, what can poor countries do? I went through commonly-recommended contenders and came out skeptical that any are a truly comparable growth engine. Is sending people to rich countries the best bet?

Another is agriculture - people need food, and AI is not growing it. But demand for food is capped, so when productivity rises, workers leave farming. And the real money is in the branding and marketing; farmers capture about 6.6 cents of every chocolate dollar.

NEW: If AI erodes paths to growth, like manufacturing and service exports, what can poor countries do? I went through commonly-recommended contenders and came out skeptical that any are a truly comparable growth engine. Is sending people to rich countries the best bet?

Export-led growth did 3 things: earned hard currency, employed huge numbers of people, and made those workers steadily more productive by doing the work. High revenues alone aren't enough if fewer and fewer people are employed by that industry, as I wrote in my last post.

New: AI could keep poor countries poor by eliminating paths to economic growth. Stocks in Indian IT firms and Philippines' call centers have been selling off, driven by fears about AI automation. In an age of AI, will the world need any of what poor countries sell?

But the same traits that make a job possible to offshore also make it especially automatable. While there's no sign of disruption looking at overall employment, new jobs in these fields are declining.

New: AI could keep poor countries poor by eliminating paths to economic growth. Stocks in Indian IT firms and Philippines' call centers have been selling off, driven by fears about AI automation. In an age of AI, will the world need any of what poor countries sell?

Manufacturing employment used to peak when countries were already rich, at around $35,000 per capita for Britain, Sweden, Italy. But later industrializers are hitting the same peak at about $1,800.

New: AI could keep poor countries poor by eliminating paths to economic growth. Stocks in Indian IT firms and Philippines' call centers have been selling off, driven by fears about AI automation. In an age of AI, will the world need any of what poor countries sell?

Why exports? Domestic consumers are too few and too poor, and new industries need imports priced in hard currency. Also, there's evidence of learning gains and productivity increases from exporting.

New: AI could keep poor countries poor by eliminating paths to economic growth. Stocks in Indian IT firms and Philippines' call centers have been selling off, driven by fears about AI automation. In an age of AI, will the world need any of what poor countries sell?

Rats are virtually everywhere humans live. Except for Alberta, Canada. Most residents there have never even seen one. How did they eliminate a pest we take as a fact of life? By waging war.

The lesson is that we ought to be *far* more ambitious. Maintaining a rat-free province sounds impossible and onerous, and if attempted elsewhere would likely garner complaints about wasted taxpayer funds. But it turns out to be *cheaper* than half-hearted reactive measures.

Rats are virtually everywhere humans live. Except for Alberta, Canada. Most residents there have never even seen one. How did they eliminate a pest we take as a fact of life? By waging war.

But this was so obviously worth it: Neighboring Saskatchewan now spends C$1.2M/year on rat control and experiences C$15M in agricultural damage annually, while it only costs Alberta C$500K/year (< C$0.11/resident/year) to maintain elimination.

Rats are virtually everywhere humans live. Except for Alberta, Canada. Most residents there have never even seen one. How did they eliminate a pest we take as a fact of life? By waging war.

This required a willingness to spend a lot of money (C$1.75M), time, and effort on what would seem to many to be a nuisance problem. It's hard to imagine most local governments rallying the resources necessary to do something this today.

Rats are virtually everywhere humans live. Except for Alberta, Canada. Most residents there have never even seen one. How did they eliminate a pest we take as a fact of life? By waging war.

Albertans - worried about disease and crops - called a state of emergency. They set up a 'Rat Control Zone' on the border, covered it in pesticides, and sent inspectors to set up watch. To rally enough people, some bureaucrats were reassigned from weed inspection to rat patrols.

Rats are virtually everywhere humans live. Except for Alberta, Canada. Most residents there have never even seen one. How did they eliminate a pest we take as a fact of life? By waging war.

New: Big technological advances in health, agriculture, and connectivity have not moved Malawi out of subsistence — and there's no war or state collapse to blame. Without knowing why Malawi is poor, you can't predict what AI will do for growth in low-income countries.

In 1925, hybrid corn came online in the US. It yielded ~20% more/acre, but by 1933 it was on just 0.1% of US corn acreage. It took another drought in 1936 to move Iowa farmers, Europe didn't follow until the 50s, and global adoption is still patchy. Could AI look the same?

New post: ML trained on phone usage data can help identify households in need during crises. Not yet finalized your end of year giving? I've teamed up with GiveDirectly along with a few other Substackers, and I’ll be matching the first $500 in donations through the link in post.