The Economic Consequences of Good Intentions

February 13, 2012 in Africa, The World Today

Incorrectly printed shirts given away for free in Africa. World Vision

By Chelsea Sweeney

Another year’s Super Bowl has ended in the United States, creating an unexpected ripple effect in parts of Africa’s economy.  Africa is unlikely to cross the minds of fans cheering on their favorite team, but there are surprising economic consequences in Africa resulting from this American tradition.  What the fans do not see are the thousands of shirts that were donated to Africa, incorrectly commemorating the losing team as victorious.  The NFL pre-prints thousands of shirts and other merchandise before the game is even played.  The shirts that accurately celebrate the results of the game are sold in American stores, and the rest are donated and given out for free in Africa.  

This direct donation of goods is called “gifts in kind” by non-governmental organizations, and is a common action taken by private individuals, as well as companies such as TOMS shoes, which gives away a free pair of shoes in developing countries for every pair bought in stores.  On the surface, giving away free items is an obvious step to help those in need.  But could there be negative consequences from giving free products to people in developing countries?  In some cases, these kind of donations can have negative economic repercussions that hinder actual economic development.

When large quantities of goods are given away for free, local markets that are perfectly capable of producing these goods themselves find they are unable to complete with the flood of free items.  A local salesman selling shirts may suddenly find himself out of business, forced to compete with the thousands of free shirts that were dumped in his town.  Or a local shoemaker may have to stop production because his community was provided free shoes made somewhere else.  This form of aid that simply gives everything away for free is heavily criticized, because it contradicts the main goal of economic development, which is to create a thriving and sustainable economy that can grow without being guided every step of the way by outside agents.  Programs such as the Super Bowl donations and One Million Shirts for Africa set up a system that depends on free stuff constantly flowing in from the West, causing harm to long-term economic progress.  Some try to put a positive spin on this kind of aid, such as the “Day Without Shoes” campaign by TOMS.  But their efforts were mocked in a “Day Without Dignity,” challenging assumptions that Western countries are responsible for providing every basic necessity for Africa, instead of supporting local production and employment.

Donating free goods is a perfectly logical action when there are items that are absolutely in need, such as vaccines, or food and clothing during a disaster.  But disaster relief is much different than building an unsustainable economic system. The focus should not be on coming up with a reason to send the stuff we don’t want to Africa.  Time and money would be better spent going towards infrastructure projects that are actually in need, creating a sustainable future not fueled by losing Super Bowl teams and the accumulated junk in America’s closets. 

This post reflects the author’s personal opinions, not the opinions of Arizona Model United Nations.

This post reflects the author’s personal opinions, not the opinions of Arizona Model United Nations.

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