Leadership and Prosperity of Nations

Leadership and Prosperity of Nations

Kriz David | 2017

Abstract

The search for sustainable source of prosperity of nations has been a long age adventure. As far back as 1776, Adam Smith, a Scottish philosopher and an economist advocated in his work,An Inquiry into the Nature and Causes of the Wealth of Nations, that the wealth of nations is premised on productivity and free market. David Ricardo (1817) inPrinciples of Political Economyadvanced the thesis of comparative advantage for exploiting factors of productions to gain national advantage and prosperity. His theory dwelled on repository of factor endowments in geographical locations and inexpensive labour in some countries as source of national prosperityThe Competitive Advantage of Nationsby Michael Porter (1990) focused on microeconomics conditions to espouse source of national prosperity by identifying the four determinants of national advantage. Other researches on this subject focused on macroeconomic conditions as the foundation for economic growth and prosperity of nations. In their research,Why Nations Fail: The Origin of Power, Prosperity and Poverty,Acemoglu, D. and Robinson, J. A (2013) argued that geographical locations, cultural differences and ignorance of leaders are not the causes of poverty in nations, but the lack of inclusive polities and inclusive institutions.

One question that remains unanswered is: why are most countries of the world yet to experience development, let alone prosperity, even with the plethora of microeconomics and macroeconomics reforms being carried out by national governments and the expertise advice offered by international nongovernmental institutions such as the International Monetary Fund (IMF), the World Bank, United Nations and several others? The reason for the failure to achieve transformation and prosperity in most countries, despite the billions of funds invested in various reforms and transformation projects, is that those interventions are designed to address symptoms of the problems rather than their root cause. Many of such intervention projects have been counterproductive with unintended consequences to nations, thus leaving most nations underdeveloped, and to wallow in vicious cycle of poverty.

This research establishes that leadership makes the difference between prosperous and poor nations. A nation is a complex system, and it requires systems thinking approach to cultivate national prosperity. It therefore behooves leadership of nations to identify high leverage points in societies, cities and nations to unlock the source of sustained prosperity for their nations. The leadership model –Leverage Points or Pillars of Prosperity of Nations,developed in this research established that the prosperity of a nation is locked in a tripod, which are: faith – value systems, learning – productivity system and law – control system. The three systems interconnect and interact with six subsystems or pillars – human and social capital, cultural values, multifactor productivity, institutional framework, governance framework and market framework to impact on the entire social system called a society or a nation. It is expected that the model would be a veritable intervention tool for policy makers, leadership of nations and international nongovernmental organizations seeking to provide lasting solutions for nations to attain prosperity.