<div dir="ltr"><div dir="ltr"><div class="gmail_default" style="font-size:large"><span style="font-size:small">On Tue, Jan 14, 2020 at 8:51 PM Paul Arveson <<a href="mailto:outlook_32A675455D056F09@outlook.com">outlook_32A675455D056F09@outlook.com</a>> wrote:</span><br></div></div><div class="gmail_quote"><blockquote class="gmail_quote" style="margin:0px 0px 0px 0.8ex;border-left:1px solid rgb(204,204,204);padding-left:1ex">
<div lang="EN-US">
<div class="gmail-m_1803795430899432621WordSection1">
<p class="MsoNormal">While in Ghana in 2015 I was told (by Ellen Seldenhuis) that in rural Ghana, per capita income is about 2 cedis per day, or 50c US per day.</p></div></div></blockquote><div><span class="gmail_default" style="font-size:large">></span><span class="gmail_default" style="font-size:large"></span>I translated prices to get a feel for the perceptions in rural Ghana:</div>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal"><span class="gmail_default" style="font-size:large">></span>Perception in US Perception in Ghana <span class="gmail_default" style="font-size:large"> How Many Days work?</span></p>
<p class="MsoNormal"><span class="gmail_default" style="font-size:large"></span>Free Free Free Free</p>
<p class="MsoNormal"><span class="gmail_default" style="font-size:large">1</span>c Incidental $2.74 Incidental<span class="gmail_default" style="font-size:large"> </span></p>
<p class="MsoNormal"><span class="gmail_default" style="font-size:large"></span>10c Incidental $27 OK if needed<span class="gmail_default" style="font-size:large"> 1/5 day</span></p>
<p class="MsoNormal"><span class="gmail_default" style="font-size:large"></span>$1 Incidental $274 Needs financing<span class="gmail_default" style="font-size:large"> 2 days</span></p>
<p class="MsoNormal"><span class="gmail_default" style="font-size:large"></span>$10 OK if needed $2740 Needs financing<span class="gmail_default" style="font-size:large"> 20 days</span></p>
<p class="MsoNormal"><span class="gmail_default" style="font-size:large"></span>$20 OK if needed $5480 Needs financing<span class="gmail_default" style="font-size:large"> 40 days</span></p>
<p class="MsoNormal"><span class="gmail_default" style="font-size:large"></span>$50 OK if needed $13,700 Very difficult<span class="gmail_default" style="font-size:large"> 100 days (over 1/3 of the year)</span></p><p class="MsoNormal"><span class="gmail_default" style="font-size:large"></span><span class="gmail_default" style="font-size:large"></span>$100 OK if needed $27,400 Very difficult<span class="gmail_default" style="font-size:large"> 200 days (almost 2/3 of the year)</span></p><p class="MsoNormal">$300 OK if needed $82,200 Out of the question<span style="font-size:large"><span class="gmail_default" style="font-size:large"> 600 days (almost 2 years)</span></span></p>
<p class="MsoNormal"></p><div><span class="gmail_default" style="font-size:large">> [snip]etc.</span></div><div><span class="gmail_default" style="font-size:large"><br></span></div><div><div class="gmail_default" style="font-size:large">This is an excellent point. Something I like to think about in relation to affordability is "how many days work." In other words - how many days at an average wage would I have to work to purchase something. And then we get into the agricultural model where I may only receive income when I sell my crop - so I don't have ANY income for most of the year and then I have to save any cash I get to last me until the next crop comes in.</div><div class="gmail_default" style="font-size:large"><br></div><div class="gmail_default" style="font-size:large">Adding a "days" column puts it in real terms that I can translate back to my own life - that $100 price point that looks like a very low amount to me can represent almost 8 months income in rural Ghana. 8 months of my own income is $...</div><br></div><div><div class="gmail_default" style="font-size:large">David Meed</div><br></div><div><span class="gmail_default" style="font-size:large"><br></span></div><div><span class="gmail_default" style="font-size:large"></span> </div><div><br></div><div><br></div><div> </div><blockquote class="gmail_quote" style="margin:0px 0px 0px 0.8ex;border-left:1px solid rgb(204,204,204);padding-left:1ex"><div lang="EN-US"><div class="gmail-m_1803795430899432621WordSection1">
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal">Could this be right? I checked; an official Ghana report from 2008 stated:</p>
<p class="MsoNormal">"Average annual household income in Ghana is about GH¢1,217.00 whilst the average per capita income is almost GH¢400. With an average exchange rate of GH¢0.92 (¢9,176.48) to the US dollar prevailing in June 2006, the average annual household
income is US$1,327 and the average per capita income is US$433 (Section 9.8). There are regional differences with Greater Accra region recording the highest of GH¢544.00 whilst Upper West and Upper East regions had less than GH¢130.00. Urban localities had
higher per capita income than rural localities."</p>
<p class="MsoNormal"><a href="http://www.statsghana.gov.gh/docfiles/glss5_report.pdf" target="_blank">http://www.statsghana.gov.gh/docfiles/glss5_report.pdf</a> [link no longer exists].</p>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal">The 2015 exchange rate was 3.7 cedis per US dollar, down from .92 cedis per dollar. Ghana was then experiencing about 40% inflation, but it is now down to about 8%.
</p>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal">Taking the average per capita income number quoted, and adjusting to the exchange rate, gives about $1 US per day per capita income. This is averaged over the whole country, whereas Ellen was probably giving a value in the rural part of
the country where she lives. So for this region, Ellen is right.</p>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal">This difference in incomes is breathtaking. </p>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal">The average purchasing power per day per capita in the US is around $137 (or $50,000 per year) -- about 274 times the 50c/day income in rural Ghana. No wonder Americans cannot relate to this level of poverty.
</p>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal">To help understand this, I arranged prices in a scale of psychologically perceived costs as follows:</p>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal">Level:</p>
<p class="MsoNormal">1 - Free, with no hidden costs</p>
<p class="MsoNormal">2 - Incidental; no significant impact on bank account; no need to budget</p>
<p class="MsoNormal">3 - OK if it is needed and fits within budget; no financing needed</p>
<p class="MsoNormal">4 – Needs financing - significant expense but can be financed over time
</p>
<p class="MsoNormal">5 – Very difficult - even with financing, would be a painful sacrifice to our lifestyle</p>
<p class="MsoNormal">6 - Out of the question; irrelevant to us</p>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal"><span class="gmail_default" style="font-size:large"></span>I translated prices to get a feel for the perceptions in rural Ghana:</p>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal">Perception in US Perception in Ghana
</p>
<p class="MsoNormal">Free Free Free Free</p>
<p class="MsoNormal">1c Incidental $2.74 Incidental</p>
<p class="MsoNormal">10c Incidental $27 OK if needed</p>
<p class="MsoNormal">$1 Incidental $274 Needs financing</p>
<p class="MsoNormal">$10 OK if needed $2740 Needs financing</p>
<p class="MsoNormal">$20 OK if needed $5480 Needs financing</p>
<p class="MsoNormal">$50 OK if needed $13,700 Very difficult</p>
<p class="MsoNormal"><span class="gmail_default" style="font-size:large"></span>$100 OK if needed $27,400 Very difficult</p>
<p class="MsoNormal">$300 OK if needed $82,200 Out of the question</p>
<p class="MsoNormal">$1000 Needs financing $274,000 Out of the question</p>
<p class="MsoNormal">$3000 Needs financing $822,000 Out of the question</p>
<p class="MsoNormal">$10,000 Needs financing $2,740,000 Out of the question</p>
<p class="MsoNormal">$100,000 Very difficult $27,400,000 Out of the question</p>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal">For instance, a dinner entree in a Chinese restaurant in Accra cost me 30 cedis. This is equivalent to about $7.50 US. In rural Ghana it is psychologically equivalent to about $2000.
</p>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal">I think this difference in perceptions is one of the reasons why some of the products being promoted for developing countries will never be accepted. It also explains why people seek to obtain fuel for free, even if it requires using
their own hard labor, rather than pay anything for it. "Free" means the same thing in both cultures.
</p>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal">It is true that people in poor countries are often are accused of being unwilling to change and adapt to the new products that the developed world wants to provide. However, I think the affordability perceptions are so out of alignment
that this amounts to blaming the victim. (Affordability is not within the scope of the ISO cookstove standard being developed, but it is implicit in the context of the sponsors to focus on the cooking needs of the developing world.)</p>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal">In light of this situation, I am interested in getting fuel cost data to estimate affordability in other places. If you have references, please let me know.
</p>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal">Thanks,</p>
<p class="MsoNormal"><u></u> <u></u></p>
<p class="MsoNormal">Paul Arveson</p>
</div>
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