'The Great Escape'

By Chang Se-moon

Perhaps, the most widely-known great escape is the World War II mass escape from the German prisoner-of-war camp StalagLuftin 1944, or the 1962 escape of prisoners from the notorious Alcatraz prison in San Francisco. There are many other great escapes in music, festivals, and even TV series. None of these led to the Nobel prize, however.

The great escape that led to the Oct. 12, 2015, announcement of the Nobel prize in economics awarded to Professor Angus Deaton is “The Great Escape: Health, Wealth, and the Origins of Inequality,” a book available through the Princeton University Press. Professor Deaton was born in Scotland and educated at Cambridge before taking a job at Princeton in 1983. He is a British and American citizen. Professor Deaton was president of the American Economic Association in 2009.

If the 360 pages are too long, there are some excellent reviews of the great book in such places as Dec. 19, 2013, review in New York Times by David Leonhardt, and an in-depth review by David N. Weil of Brown University in the Volume 53, No. 1 (2015) of the prestigious Journal of Economic Literature, published by the American Economic Association. Note that these reviews were published before the announcement was made on Oct. 12, 2015.

What does Professor Deaton tell us in “The Great Escape?”

The book’s title, “The Great Escape,” refers to the process of human beings being freed from poverty and premature death, which began around the Enlightenment. The philosophical movement Enlightenment in Europe is considered as the beginning of the rapid economic development in humanity. French historians place the Enlightenment between 1715, the year that Louis XIV died, and 1789, the beginning of the French Revolution, while others place the beginning in the 1620s when the scientific revolution and thus the Great Escape started.

Professor Deaton’s analysis in The Great Escape centers around the complementary role of income and health in pulling humanity out of millennial poverty and early death, although the book covers a wide range of important topics on human welfare well beyond the role of the two.

An important question relates to the causal relation between income and health. It may be easy to conjecture that rising income led to better health. According to Professor Deaton, the answer is not that simple. Low income does not necessarily mean less health in that sufficient knowledge to reduce mortality is available even in many poor countries. Significant differences in mortality exist not only within high-income countries, but also among countries.

What then explains lower mortality when sufficient knowledge is available to lower the mortality within a country as well as among countries? According to Professor Deaton, the answer lies in the capacity of the country to apply the knowledge on improving the health.

Important question is how societies can improve the health of their members and thus lower mortality. After acknowledging that a large amount of knowledge is available in most, if not all, societies and all societies have institutions such as government that can make knowledge accessible to all their members although the quality of institutions can vary, Professor Deaton focuses on the importance of educating individuals to have access to the knowledge.

Today’s biggest problems for the continuing and long-term progress in escaping from poverty and poor health, according to Professor Deaton, are the lack of adequate education and climate change both of which are not easy to overcome. Professor Deaton concludes that improving knowledge through education is the most powerful cause of the recent longevity boom in most poor countries, even more powerful than high incomes. In other words, knowledge through education is humanity’s most important engine forcontinuing the process of the escape.

Admittedly, although this may not be true in Korea, Professor Deaton opines that the rich and powerfulin many societies continue to question the value of education for their masses, while pursuing the best and most expensive education for their children.

Professor Deaton has also expressed thought-provoking opinions on selected issues during his January 2010 presidential address and other writings. One such issue relates to the way economists measure poverty in poor countries. Professor Deaton views it wrong to measure poverty by the count of people living on less than $1 a day. He believes that this approach overestimates poverty and encourages surveys of individual household circumstances in its stead. On another issue, Professor Deaton in cooperation with Princeton colleague Daniel Kahneman has claimed that happiness increases with income, but only up to about $75,000 a year.

Finally, Professor Deaton states that income inequalityis posing a new economic and political challenge, because “inequality has gone past the point where it’s helping us all get rich, and it’s really becoming a serious threat.” I can see that it will require monumental efforts by leaders in all professions to search for an optimal inequality in income distribution that simply do not exist in today’s world.

Chang Se-moon is the director of the Gulf Coast Center for Impact Studies.