Ideas and innovation are the driving force of economic growth. I wrote a summary of economic growth theory highlighting changes in how economists view the development process. You can download a copy of my paper here.

There is not a consensus among economists on exactly how to promote economic development, there is general agreement that development requires economic growth, a real increase in per capita income, and the social and political institutions necessary to support an expansion of the national economy.  It also requires citizens who can work effectively in the enterprises.  As the production of goods and services rise at a rate higher than increases in population there is economic growth.  

Economic development, in addition to increased per capita income, also includes fundamental changes in the structure of the economy.  These changes are characterized by a growing industrial sector combined with a declining agriculture share of Gross Domestic Product (GDP) as well as significant changes in population growth, rural to urban migration, and employment opportunities

Ideas - What are they good for?

Ideas and innovation improve productivity and drive economic growth. A 1990 technical paper, Endogenous Technological Change (1.95 MB pdf) by Paul Romer, a thirty-six year old University of Chicago economist, explained the importance of innovation in promoting economic growth. Romer proposed that innovation was a factor of production that was critical for economic growth. Land, labor and capital had been the standard factors of production with technological change considered an exogenous or external attribute. See my summary of economic growth theory for an explanation of the evolution of economic theory.

Housing Initiative - Guest Worker Program

"An Incentive to Return Home"

Based on my international development experience and observations of the ongoing immigration debate, I believe there is an important opportunity to establish a $4 billion modular home export venture.  America needs immigrant workers and soon there must be immigration reform that includes an effective guest worker program.  For that program to be acceptable, it must include a strong incentive for immigrants to return home. 

I have developed a proposal that would establish a home financing mechanism in which guest workers pay 7.5 percent of salary matched by their employer during their work period into a housing fund.  This “housing” payment would take the place of the social security tax for guest workers and the fund would finance home purchases under a regulated and credible program managed by the US private modular home industry.  A guest worker would only have access to this fund upon returning to their home country at which point a credit would be issued for the delivery of a modular home either exported from the US or manufactured and delivered overseas. If 200,000 guest workers participated in this program for 4 years at an average wage of $9.00 an hour depending on the number of hours worked each week the total accumulation of housing funding could exceed $2.5 billion. This would represent real assets in the hands of poor people across Latin America and the ripple economic effect of the housing market generated by these funds would be enormous. My son, Andrew Jackson Maxey III, has written a business plan for this concept -- Gateway Housing.

Michael Maxey

Key Qualifications

Senior Manager with extensive experience in promoting agricultural enterprises. Used strong management, marketing and commercial skills to develop creative approaches for local ownership of economic development initiatives. Developed concepts and marketing proposals that have been broadly adopted by USAID, other donors, and the private sector.

Accomplishments

Washington DC Remittance & Credit Network – As part of MBA program at the University of Costa Rica, developed a business plan for a Washington DC based remittance network associated with Hispanic non-profits partnering with local DC credit union to channel remittances from Washington DC back to Central America and Mexico. My plan significantly reduced remittance transfer costs and increased immigrant access to formal financial sector. 

Global Coffee Marketing Strategy – Developed USAID Global Coffee Strategy which successfully guided small farmer marketing initiatives in Latin America in accessing $8 billion US specialty coffee market. Ted Lingle, former SCAA Director, cited this work as “visionary” in the Coffee & Tea Journal (Dec. 2000).

Market Access for the Poor (MAP) – Designed and implemented program linking 17,000 small scale farmers to $100 million fresh fruit and vegetable market in 254 supermarkets across Central America.  Also, initiated Faith-Based coffee marketing program providing small farmer access to US market.

Personal Links

My Story

Bible Readings

John Rundle High School (JRHS)

Grenada, Mississippi

Site of John Rundle High School & Lizzie Horn Elementary

Grenada, Mississippi