Wonderful essay about Somalia with and without its government by Peter Leeson.
You can download it here: Better_Off_Stateless.pdf
When most people think of Somalia they think of chaos and deterioration. Some may even think of violence and mayhem. No one, however, thinks of progress when they hear about Somalia, let alone of the possibility that anarchy has been good for its development. Maybe they should.
Indicators of Somali welfare remain low in absolute terms, but compared to their status under government show a marked advance. Under statelessness life expectancy in Somalia has grown, access to health facilities has increased, infant mortality has dropped, civil liberties have expanded, and extreme poverty (less than $1 PPP/day) has plummeted. In many parts of the country even security has improved. In these areas citizens are safer than they’ve been in three decades (UNDP 2001). Somalia is far from prosperous, but it has made considerable strides since its government collapsed 15 years ago.
Despite this progress, there has been much hand-wringing over what to do about the situation of anarchy that has characterized the country since 1991. To be sure, this concern is not without cause. In the year following the state’s collapse, civil war, exacerbated by severe drought, devastated the Sub-Saharan territory killing 300,000 Somalis (Prendergast 1997). For a time it seemed that Somali statelessness would mean endless bloody conflict, starvation, and an eventual descent into total annihilation of the Somali people.
Though largely unrecognized by economists, the widespread violence that ravaged Somalia in its first year without government vanished considerably by 1994. By the mid-1990s peace prevailed over most of the country (Menkhaus 1998, 2004). Since 1997 most indicators of Somali development show slow but steady progress and today are above their pre-stateless levels. Nevertheless, conventional wisdom sees Somalia as a land of chaos, deterioration and war, and is certain that statelessness has been detrimental to Somali development.
The reason for this belief is two-fold. On the one hand, popular opinion sees government as universally superior to anarchy. Government is considered necessary to prevent violent conflicts like those that erupted when Somalia’s state first crumbled, which disrupt economic activity. Government is also considered critical to supplying public goods such as roads, schools, and law and order, which are important to the process of development. From this perspective it is easy to conclude that Somalia, which has no central government, must have been better off when it did.