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For decades, international institutions have pumped billions of dollars into developing nations in attempts to remedy their ills through the development of their technological infrastructures, educational systems, and health care programs.
Yet despite this infusion of capital and attention, roughly five billion of the world’s six billion people continue to live in poor countries. What isn’t working? And how can we fix it?
In his book The Power of Productivity, William W. Lewis—a founding director of the McKinsey Global Institute (MGI) and a former McKinsey partner—offers a practical look at why some countries are rich, why others are poor, and what we can do about it.
Tapping the consumer

The Power of Productivity argues that the key to reducing economic inequalities between rich and poor countries is productivity and its links to competition and consumption. It further argues that only one force can stand up to producer special privileges—consumer interests.
Lewis’s book is based on years of research on the economies of 13 nations. His analysis asked fundamental questions about what products are purchased by consumers, how (or if) people and corporations pay taxes, even how large or small a country’s retail stores are.
From Russia and India to Brazil and the United States, MGI studied national economies from the ground up, and Lewis brings together the results and formulates them into a broad and applicable set of solutions for ameliorating economic disparity.
Demolishing long-held beliefs

In laying out these solutions, Lewis also demolishes long-held beliefs about how best to help poor nations. For example, an educated work force, he found, is not essential to improving a country’s productivity, so development money spent on education in poor nations has often proven ineffective in improving economies. The same is true of efforts made to improve the solvency of individual governments and exchange rate flexibility as well.
With a firm fact base behind him, Lewis explores beyond the strict economic lines that define MGI’s reports. The last three chapters contain Lewis’ insights into political economy based on extensive research and his own observations.
Lewis’s conclusions will prove to be highly controversial, but few will be able to argue with his research and reasoning, in part because it is based not on theory but on actual practice.
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