Human Development Reports - United Nations Development Programme (UNDP)

Do people consider a trade-off between human rights and economic growth and prosperity?

Sen (6) discusses the argument that if poor people are given the choice between having political freedoms and fulfilling economic needs, "they will invariably choose the latter" (p.148). Sen's answer to this issue points out the instrumental role of democracy and political freedoms for economic development. Fukuda-Parr (1) remarks that certain basic principles should not be subject to trade-offs for reasons of efficiency; one basic principle, for example, being that each individual's right should be considered as equally important. In his justice theory, Rawls (4) emphasized the priority of basic liberties but he also conceded that for a limited period of time, there may be a trade-off between liberty and economic advantages. In a project within "empirical social choice", we were interested in the value or importance that individuals attach to basic human rights in relation to economic advantages (2). We asked large numbers of students over a longer time span to make up their mind on the following situation:

Imagine a country that had been totally run down economically by a long-lasting dictatorship. Finally, the country could get rid of this dictatorship. Imagine now that an international consortium offers a large loan for economic reconstruction. The prerequisite for this loan is, however, that the employees of this country renounce some basic rights, among them, their right to strike. Without the loan, all basic human rights could be reinstated immediately as promised after the fall of dictatorship. What would be your decision?

In 1989, well over 60 per cent of the students at Osnabrück University in Germany declared that they would unconditionally opt for the reinstatement of basic human rights (2). This percentage fell continually over the years to 37 per cent in 2003. In the Baltics, only 13-15 per cent were in favour of basic rights (1998 and 2001). In China, but also in Malaysia and Mexico, special export zones exist where workers give up several of their rights in order to be hired. Is this just a transient phenomenon?

How can one understand the scanty appeal of human rights in developing, and especially emerging countries? Can it be justified? Are democratic rules something which only rich countries can afford? Or as Amartya Sen put it in his book "Development as Freedom" (6), is political liberty a luxury that a poor country "cannot afford"? Sen's answer is that "political rights, including freedom of expression and discussion, are not only pivotal in inducing social responses to economic needs, they are also central to the conceptualization of economic needs themselves" (6, p. 154).

What is the value of human rights?

Human rights have an intrinsic and an instrumental value. Imagine a minority group which does not have the same rights that the majority of the population enjoys. The minority will feel humiliated and consequently may lack self-respect, one of the primary goods in John Rawls's concept of justice (4). Sinti and Roma in continental Europe and migrant peasant workers in China are a case in point. If certain minorities do not have a right to send their children to school, not only the present generation but also the generation that follows will remain excluded from society. The same argument applies to the right to vote. An unequal treatment is not only unfair. It is politically dangerous, since it plants a germ of potential social unrest.

The entitlement to civil, political and economic rights achieves its instrumental value by generating valuable functionings (5). Access to high-quality medical care is a prerequisite for leading a healthy life, access to high-quality education significantly widens the opportunities of the individual. Clearly, in order to fruitfully exercise these rights, there must be correlative duties "on the other side" (1,7). If the constitution of a particular nation grants a right to schooling but nowhere in the vicinity of a young person a school can be found or the quality of the educational system is very low, the set of opportunities of that young person and of many others will shrink drastically.

Are human rights detrimental to economic growth?

When one studies time series of growth rates over the last thirty years of most Western European countries where human rights have been granted fairly extensively to the individual citizen and compares these growth rates with those of China or South Korea over the same time span, one might get the idea that indeed human rights and their exercise are inversely related to growth of the overall economy. However, using a fairly narrow time frame and not a time span of 100 or 150 years and reducing the comparison in addition to the nations just mentioned can easily lead the observer astray. Very clearly, the right of access to good medical care and the right of access to high-quality education yield higher productivity and since economies are constantly changing in their structure, lead to larger adaptability on the part of the work-force. Both rights help to increase the number and the quality of functionings of people and thereby enlarge their capability set (5). All this promotes growth. If human rights engender wider political participation of the average citizen and strengthen the bargaining power of the work-force, inequality will decrease. It has been shown by Persson and Tabellini (3) that a higher degree of economic inequality leads to slower growth. The authors, however, concede that this correlation is present only in democratic countries. The theoretical idea behind the authors' verdict is that more equality generates less redistribution via government intervention, whereby, supposedly, government redistribution would hamper growth by discouraging investment.

The relationship between human rights and economic growth is complex and multi-directional. Both right holders and duty bearers have responsibilities in ensuring the full protection of human rights for the benefit of all social groups. As part of these efforts, we must ask ourselves difficult and sometimes provocative questions. Greater research is needed to explore issues of perception, the political economy of human rights-based decision-making and policy implementation, and causal links to various types and stages of economic growth.

Some general sources:

1. Fukuda-Parr, Sakiko. "Human Rights Based Approach to Development – Is it Rhetorical Repackaging or a New Paradigm?" HD Insights, HDR Networks, Issue 7 (2007).
2. Gaertner, Wulf. "Individual Rights versus Economic Growth". Journal of Human Development 9 (2008).
3. Persson, Torsten, and Guido Tabellini."Is Inequality Harmful for Growth?" American Economic Review 84 (1994).
4. Rawls, John. 1971. A Theory of Justice. Cambridge, Ma., Harvard University Press.
5. Sen, Amartya. 1985. Commodities and Capabilities. Amsterdam, North-Holland.
6. Sen, Amartya. 1999. Development as Freedom. Oxford, Oxford University Press.
7. Steiner, Hillel. 1994. An Essay on Rights. Oxford, Blackwell.

Note: HD Insights are network members' contributions and do not necessarily represent the views of UNDP.