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OUP CORRECTED PROOF – FINAL, 26/2/2016, SPi

The Pursuit of Development


OUP CORRECTED PROOF – FINAL, 26/2/2016, SPi

Previous Books by Ian Goldin

Age of Discovery: Navigating the Risks and Rewards of Our New


Renaissance
The Butterfly Defect: How Globalization Creates Systemic Risks,
and What to Do about It
Is the Planet Full?
Divided Nations: Why Global Governance Is Failing, and What
We Can Do about It
Exceptional People: How Migration Shaped our World and Will
Define our Future
Globalization for Development: Meeting New Challenges
The Case for Aid
The Economics of Sustainable Development
Economic Reform, Trade and Agricultural Development
Modelling Economy-wide Reforms
Trade Liberalization: Global Economic Implications
Open Economies
The Future of Agriculture
Economic Crisis: Lessons from Brazil
Making Race: The Economics and Politics of Identity
OUP CORRECTED PROOF – FINAL, 1/3/2016, SPi

PRAISE FOR THE PURSUIT OF


DEVELOPMENT

‘Ian Goldin has been in the engine room of policy and action in
South Africa, a leading figure in the World Bank and at the head of
one of the world’s most important research institutions in Oxford.
This important book reflects the richness of his experience and
scholarship. It shows how development can be fostered as well as
the vulnerabilities, complexities and risks. It is succinct, wise, well-
informed, broad ranging and deep. It is also very accessible and
admirable in its brevity. A splendid achievement.’
Lord Nicholas Stern, President of the British Academy,
and IG Patel Professor of Economics and Government,
London School of Economics.

‘I strongly recommend Ian Goldin’s excellent book—a ‘must read’


for anyone interested in development. He shows why some people
and some countries stay poor while others get rich. This highly
accessible book identifies what development means, why it matters
and what we can all do to improve our world.’
Sir Suma Chakrabarti, President of the European Bank for
Reconstruction and Development and former Permanent
Secretary of the United Kingdom Department of International
Development and of the Ministry of Justice.

‘The Pursuit of Development by Ian Goldin could not have come at a


better time. The adoption of Sustainable Development Goals puts a
high premium on our understanding of how development happens
OUP CORRECTED PROOF – FINAL, 2/3/2016, SPi

at a time when the global economic landscape is undergoing seismic


changes. The rigour of analysis and the broad approach to the
evolution of thinking beyond the narrow economic approach over
time is one which will greatly benefit the younger generation stu-
dents of development. I highly recommend this primer.’
Donald Kaberuka, President of the African Development Bank
(2005 to 2015) and formerly Minister of Finance, Rwanda.
‘Every citizen should be a champion of, and contributor to, sustain-
able development. Ian Goldin’s book is a great starting point for
understanding our current sustainable development challenges
and future possibilities, including the end of poverty in our time.
The book offers a succinct, highly readable, and reasoned intro-
duction to the debates and the data, from the vantage point of a
world-leading development thinker and practitioner.’
Jeffrey D. Sachs, Special Advisor to the UN Secretary-General
on the Sustainable Development Goals and author
of The Age of Sustainable Development.

‘Anyone interested in development should read The Pursuit of Develop-


ment. Development remains the greatest challenge for humanity. Draw-
ing on his remarkable experience, Ian Goldin looks both back and
forward to address the remaining old and the many emerging chal-
lenges, including rising inequality and climate change. I strongly rec-
ommend this immensely readable, timely and vitally important book.’
Kumi Naidoo, International Executive Director,
Greenpeace and former Secretary General, Civicus.

‘Ian Goldin looks at the complexities of development in our inter-


connected world, and does what so few do. Joining up the dots, he
looks beyond the narrowly economic, and beyond Governments to
people. He considers the important role played by social movements
and by those in a broad range of organisations. He tells us that we all
have a part to play if only we continue learning. A must read.’
Baroness Valerie Amos, Former UN Under-Secretary-General
for Humanitarian and Emergency Relief, Director of SOAS,
University of London.
OUP CORRECTED PROOF – FINAL, 26/2/2016, SPi

The Pursuit of
Development
Economic Growth, Social Change,
and Ideas

IAN GO LDIN

1
OUP CORRECTED PROOF – FINAL, 26/2/2016, SPi

3
Great Clarendon Street, Oxford, OX2 6DP,
United Kingdom
Oxford University Press is a department of the University of Oxford.
It furthers the University’s objective of excellence in research, scholarship,
and education by publishing worldwide. Oxford is a registered trade mark of
Oxford University Press in the UK and in certain other countries
© Ian Goldin 2016
The moral rights of the author have been asserted
First Edition published in 2016
Impression: 1
All rights reserved. No part of this publication may be reproduced, stored in
a retrieval system, or transmitted, in any form or by any means, without the
prior permission in writing of Oxford University Press, or as expressly permitted
by law, by licence or under terms agreed with the appropriate reprographics
rights organization. Enquiries concerning reproduction outside the scope of the
above should be sent to the Rights Department, Oxford University Press, at the
address above
You must not circulate this work in any other form
and you must impose this same condition on any acquirer
Published in the United States of America by Oxford University Press
198 Madison Avenue, New York, NY 10016, United States of America
British Library Cataloguing in Publication Data
Data available
Library of Congress Control Number: 2015956178
ISBN 978–0–19–877803–5
Printed in Great Britain by
Clays Ltd, St Ives plc
Links to third party websites are provided by Oxford in good faith and
for information only. Oxford disclaims any responsibility for the materials
contained in any third party website referenced in this work.
OUP CORRECTED PROOF – FINAL, 26/2/2016, SPi

To the memory of my mother


Who taught me to look and learn
OUP CORRECTED PROOF – FINAL, 26/2/2016, SPi
OUP CORRECTED PROOF – FINAL, 26/2/2016, SPi

CONTENTS

Preface and Acknowledgements xi


List of Figures xv
List of Tables xvii

1. What is Development? 1
2. How Does Development Happen? 18
3. Why Are Some Countries Rich and
Others Poor? 37
4. What Can Be Done to Accelerate
Development? 54
5. The Evolution of Development Aid 79
6. Sustainable Development 119
7. Globalization and Development 129
8. The Future of Development 156

Sources for Figures and Boxes 173


References 178
Further Reading 197
Index 205

ix
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OUP CORRECTED PROOF – FINAL, 26/2/2016, SPi

PREFACE AND ACKNOWLEDGEMENTS

How individuals and societies develop over time is a key


question for global citizens. Development motivates and
intrigues me. I have worked in and with developing coun-
tries for my entire career and it has been a privilege to be
asked by Oxford University Press to distil my experience
into this short volume.
I have trained and worked as an economist and so my
perspective is largely informed by the economic literature
and my engagement in economic policy. As a Vice President
and the Director of Development Policy for the World Bank
Group, Head of Programmes at the Organisation for Eco-
nomic Co-operation and Development (OECD) Develop-
ment Centre, and principal economist at the European
Bank of Reconstruction and Development (EBRD), as well
as in my role as Chief Executive of the Development Bank of
Southern Africa (DBSA) and advisor to President Mandela,
and more recently as the Senior Independent Director of the
United Kingdom Government’s aid agency CDC, I have
drawn on the wisdom of numerous scholars, policymakers,
and members of the development community. Principal
among them has been Nick Stern, who has informed my

xi
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Preface and Acknowledgements

understanding of the role of ideas. Having represented both


developing country and global institutions at different
stages of my career I have learnt that the position one sits
in necessarily informs one’s views. In practice however,
every circumstance is different and there is no theory or
lesson that may be replicated everywhere.
In my current role as Director of the interdisciplinary
Oxford Martin School and Professor of Globalisation and
Development at the University of Oxford, I have come to
appreciate the pitfalls of narrow economic perspectives. All
our futures will be shaped by trends which transcend
national borders, as they do academic disciplinary silos.
Demographic, climate, health, technological, and other
developments will shape all our destinies. The future of
developing countries is intertwined with those of the most
advanced economies. Widening our perspectives beyond
our narrow professional and national perspectives is more
vital than ever.
If there is one thing this book shows it is that there is the
need for constant learning. The evolution in our under-
standing of development makes me optimistic. We have
come a long way. But there is much we still do not under-
stand and much more to learn.
A short book is necessarily selective. All of the topics
I have covered are the subject of fuller analysis elsewhere,
and parts of this volume draw on my previous books. I am
most grateful to my co-authors for their insights and to the
many colleagues, scholars, and policymakers from whom
I have been most fortunate to learn over the past decades.

xii
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Preface and Acknowledgements

This volume owes much to the remarkable depth and


breadth of David Clark’s knowledge of development. David
helped me shape the proposal for this book and has subse-
quently played a vital role in identifying key texts and help-
ing lay the foundations for the book, as well as preparing its
figures and tables, and contributing to my response to the
referees’ reports and polishing the final text. Maximilia Lane
provided excellent research assistance in the drafting of
Chapter 1. John Edwards, a recent graduate in development
at Oxford, went through the early draft, improving the flow
and identifying shortcomings in my coverage, and Sarah
Cliffe has generously provided very timely and helpful
advice on my understanding of conflict and development.
My son Alex offered candid and constructive comments and
daughter Olivia drew on her English and Development Eco-
nomics studies to improve the entire final text.
OUP has once again proved to be a remarkable publishing
partner. Andrea Keegan encouraged me to write this book and
Jenny Nugee has provided timely expert guidance throughout
the publication process, supported by her many tremendously
helpful Oxford colleagues and Saraswathi Ethiraju and others
in India. I also am grateful to two anonymous reviewers and
have sought to incorporate their helpful comments.
My purpose in writing the book is to convey my passion
and interest in development and the progress being made
through the combination of learning and doing. Devel-
opment is a team sport that requires the engagement of
civil servants, businessmen and women, scholars, non-
government organizations, and citizens in all countries.

xiii
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Preface and Acknowledgements

I hope that this volume increases your interest and your


ability to contribute to the success of global development.
Ian Goldin
Oxford, February 2016

xiv
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LIST O F FIG URES

1 GDP per capita for selected regions and


the world (1870–2010). 39
2 GDP per capita for selected countries (1870–2010). 40
3 Kuznets Curve. 53
4 Annual infrastructure spending requirements in the
developing world. 68
5 Armed conflicts by region (1946–2014). 73
6 External debt of developing countries (1970–2013). 97
7 Financial flows to developing and least developed
countries (2000–13). 109
8 Financial flows to developing countries—foreign aid,
remittances, portfolio investment, and foreign direct
investment (1970–2015). 110
9 Traditional and non-traditional aid donors (2000–2013). 112
10 The rise of non-traditional aid donors. 113
11 Share of patents across regions (2013). 141
12 People living on less than $1.90 per
day by region (1990–2012). 158

xv
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L I S T O F TA B L E S

1 Selected indicators of poverty and development 44


2 World population by regions 57
3 Gender-related indicators of development 61
4 Average annual net aid flows received (1960–2014) 80
5 Estimates of genocide since the Second World War
and associated refugees 154
6 Total number and proportion of people below the $1.90
poverty line (1990–2015) 159

xvii
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1
R
What is Development?

Too many people in the world still live in desperate poverty.


About 900 million people live on less than $1.90 a day, the
World Bank’s definition of extreme poverty. Over a billion
people live on less than two dollars a day and are deprived of
the means to lead a decent life. Why is this so? And what can
be done? These are amongst the most important questions
facing humanity at the start of the new millennium.
Progress in tackling poverty over the past twenty-five
years has been remarkable. The Millennium Development
Goal primary target, to cut the 1990 poverty rate in half, was
achieved in 2010. For the first time in history, there is the
real possibility of eliminating extreme poverty in our life-
times. To achieve this, we need to understand how develop-
ment happens.
A hundred years ago, Argentina was amongst the seven
wealthiest nations in the world, but now ranks 56th in
terms of its per capita income. In 1950, Ghana’s per capita
income was higher than that of South Korea; now South
Korean people are more than eleven times wealthier than

1
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What is Development?

the citizens of Ghana. Meanwhile, whilst in recent decades


over 3 billion people have seen remarkable improvements in
health, education, and incomes, more than twenty failed
states and over a billion people have seen little progress in
development.
Within countries, the contrast is even greater than
between countries. Extraordinary achievements enjoyed by
some occur alongside both the absolute and relative depriv-
ation of others. What is true for advanced societies, such as
the United Kingdom and United States, is even more so in
most, but not all, developing countries.
Some countries have grown rapidly, but have lagged
behind others in terms of social achievements. Equatorial
Guinea has grown even faster than China since the discovery
of oil in 1996. Average per capita income expanded from
$1,970 in 2000 to $17,430 in 2014. Yet few people have
shared in this new-found prosperity. Despite now having a
per capita income similar to Estonia or the Czech Republic
(and higher than almost all other African countries), life
expectancy has barely improved since the turn of the century
and has averaged under fifty years. Meanwhile, considerably
poorer African countries such as Ethiopia have managed to
increase life expectancy by sixteen years since 1990.
In other cases, low or modest growth has been associated
with sustained improvements in social indicators. Bangladesh
has made steady progress with literacy and life expectancy
over the last twenty-five years, even though per capita
income remains low (around $1,093). In India the state of
Kerala (which is home to over 33 million people), has per-
sistently outperformed other Indian states in virtually all

2
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What is Development?

social indicators including literacy, life expectancy, infant


mortality, under-nourishment, and fertility. Yet several
Indian states enjoy higher per capita incomes.
This book seeks to explain the pursuit of development
through eight thematic chapters, each of which draws on
development theory and practice and an interdisciplinary
perspective.

The Meaning of ‘Development’

There are many definitions of development and the concept


itself has evolved rapidly over recent decades. To develop is
to grow, which many economists and policymakers have
taken to mean economic growth. Yet development is not
confined to economic growth. Development is no longer
the preserve of economists and the subject itself has enjoyed
rapid evolution to become the object of interdisciplinary
scholarship drawing on politics, sociology, psychology, his-
tory, geography, anthropology, medicine, and many other
disciplines.
While Development Studies is relatively new as an aca-
demic discipline, the questions being asked are not—
philosophers have puzzled over them for millennia. Our
questions are rooted in both classical political economy
and ancient philosophy, such as Aristotle’s notions of well-
being and human flourishing. Many of the giants of classical
economics were also concerned with this intersection of
economic and philosophical thought. Adam Smith worried
about the ‘progress of opulence’ and the necessities
of achieving self-respect; he recognized the importance of

3
OUP CORRECTED PROOF – FINAL, 24/2/2016, SPi

What is Development?

being able to appear in public unashamed and argued that


people need certain basic necessities, such as linen shirts or
leather shoes, to avoid shame, depending on custom and
social convention.
In this volume, our focus is on the economic and social
development of societies and people’s lives. Leading
scholars have long recognized that economic development
cannot be equated with economic growth. For Paul Streeten
development aims ‘to provide all human beings with the
opportunity for a full life’, while for Dudley Seers it should
create ‘the conditions for the realization of human person-
ality’. Such concerns have been more fully articulated
by Amartya Sen’s Capability Approach, which views devel-
opment in terms of capabilities or substantive ‘freedoms’
people have reason to value.

Why are Some Countries Rich and Others Poor?

Until the 1980s development policy mainly focused on gen-


erating economic growth. In purely economic terms, growth
increases when total factor productivity, or the efficiency of
production, increases. An increase in a country’s use of
labour and capital, or its greater efficiency, provides for
economic growth. Growth can be associated with increases
in investment in resources, including education and health,
leading to capital accumulation, or an increase in wealth. It
also can result from changes in the way these resources are
used, leading to structural transformation of economies, in
which there is a reallocation of economic activity, typically
from agriculture to manufacturing and services.

4
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What is Development?

While development cannot be reduced to economic


growth only, economic growth is often necessary to facili-
tate development. Growth is generally needed to eradicate
poverty, because in poor societies without economic growth
there are insufficient resources to invest in education,
health, infrastructure, and the other foundations of devel-
opment. Because economic growth is an important engine
of development, the measurement of development for
many years was often reduced to economic indicators only.
However, growth alone is insufficient, as is evident from the
continued prevalence of dire poverty in many countries
which have enjoyed sustained growth.
Development is necessarily in part a normative or value-
based concept. What would make me feel better off is not
necessarily the same as what would make you feel better off
and the balance between different dimensions of develop-
ment requires subjective judgements. Nevertheless, devel-
opment thinkers and policymakers try to find measureable
features of life to set goals of development and judge success
and failure according to thresholds. Numerous measure-
ments and assumptions are employed to derive such com-
mon frameworks, which draw on both objective criteria and
subjective judgements. The World Bank’s poverty threshold
of $1.90 a day embodies wide-ranging assumptions, as does
the categorization of ‘low’, ‘middle’, and ‘advanced’ econ-
omies. Similarly, there is a ceiling of $1,215 for the per capita
national income levels that in 2015 qualified seventy-seven
countries to be defined as ‘low income’, and therefore
eligible for highly concessional lending from the World
Bank and other multilateral banks. The World Bank’s recent

5
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What is Development?

revision of the poverty threshold to $1.90 per day, whereas


previously it had been $1.25, transformed overnight the
number of people defined as poor and their global distribu-
tion. This is indicative of the somewhat arbitrary nature of
the measurement of poverty. Similarly significant assump-
tions also are embedded in the comparison across countries,
using wildly fluctuating exchange rates and their adjust-
ments to purchasing power parity (PPP).
The most common measure of economic growth is Gross
Domestic Product (GDP) which measures a country’s
national output and expenditure. Gross National Product
(GNP) measures the products and services produced by all
citizens of a given country, adding the balance between
income flowing in from abroad and outflows from the coun-
try. If the outflow of income to foreign assets is greater than
the inflow of income from abroad, GNP will be smaller than
GDP. Gross National Income (GNI) measures the domestic
and foreign output of all residents of a country.
GDP is the most widely used measure of development
as it is relatively easy to calculate, accessible, quantifiable,
and comparable across borders. Dividing GDP by the popu-
lation gives GDP per capita, which is a widely used bench-
mark as it reflects levels of average development by
accounting for discrepancies in population size. To over-
come the distortions that arise when comparing incomes or
expenditures across countries using nominal (official)
exchange rates, the concept of purchasing power parities
(PPP) was introduced, as early as 1940. PPP aims to compare
a country’s product against its international price, so that
economists can see how much a bundle of comparable

6
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“Do you live in that nice place among the baskets?”
Page 51.
ALL THAT HAPPENED
IN A WEEK A STORY
FOR LITTLE CHILDREN

By

Jane H. Findlater

LONDON, EDINBURGH,
DUBLIN, & NEW YORK
THOMAS NELSON
AND SONS

CONTENTS.
I. The Arrival, 9
II. The Wasps, 15
III. The Doctor, 20
IV. The White Stones, 27
V. A Very Bad Child, 32
VI. A Day in Bed, 41
VII. The Adventure in the Lane, 49
VIII. The Ship, 60
IX. The Washing Day, 69
X. The Sea Beasts, 79
XI. The Last Day at Seafield, 86
CHAPTER I.
THE ARRIVAL.

ne summer afternoon many years ago a child, called Peggy


Roberts, arrived at the door of her aunt’s house in an open
carriage. Peggy was just eight years old. She had been in
the train since early in the morning, and was very tired when the
carriage stopped at the door of Seafield. Then she noticed that
everything round her was new and different from things at home, and
she forgot about feeling tired. The house was exactly like the tea-
caddy that stood on the dining-room side-board at home, and had
been brought from China by her uncle—that is to say, it was quite
square, and you felt as if you could lift off the top like the lid of the
tea-caddy.
Right up to the windows there grew such a
lovely rose-tree, covered all over with
branches of bright red roses.
“O Martin, let me get some of the roses!”
Peggy cried, standing still on the steps of the
house.
Martin was her aunt’s maid, a stout, cross-
looking woman, who always refused to allow
Peggy to do anything she wanted.
“No, no, Miss Peggy, come in for your tea;
the roses are far too high up,” she said.
Peggy looked up at the beautiful dangling branches, and her mouth
went down at the corners; she thought nothing would make her
happy unless she got one of them.
It must have been because she was so tired that she began to
cry about nothing in this way. The coachman was more good-
natured than Martin, however, for he stood up on the box of the
carriage and gathered a bunch of the roses. “Here, missie,” he said,
leaning down from his high seat, and handing them to Peggy.
“Oh! oh! oh!” Peggy cried, burying her nose in the lovely red
bunch.
But then something horrid happened: a whole family of great, fat,
brown earwigs came hurrying and dropping out of the roses, in the
greatest speed to get away. Down went the roses on to the steps,
and Peggy cried in earnest now.
There was nothing she hated like earwigs, and to have a whole
nest of them fall out on her frock was too much for her altogether.
And then Martin was so pleased.
“See there, Miss Peggy; that’s what you get for wanting to pick
flowers!” she said. But she did brush away the earwigs, and stamped
upon the biggest of them to Peggy’s great disgust. Then they went
into the house, and she had to speak to her aunt; and, of course, she
had nothing to say to her.
Tea was on the table. A different kind of bread was there from the
home-bread Peggy knew. She went and stood beside the table and
looked at it, then put out her finger and touched it.
“Don’t touch things on the table!” said Aunt Euphemia.
“I’m sorry!” said Peggy, and wanted to cry again. But the door
opened, and such an exceedingly nice cat came walking in, just as if
the house belonged to it, that she forgot all about crying.
She ran to the cat, and went down on her knees on the carpet to
stroke him.
“He is called Patrick,” said Aunt Euphemia; “take care that he
does not scratch you.”
But Patrick did not mean to scratch. He rubbed his big yellow
face against Peggy in the most friendly way, and then walked to the
tea-table and jumped up on a chair and mewed twice, very loudly,
exactly as if he were asking for his tea.
“Patrick is very punctual,” said Aunt Euphemia.
She poured out a saucer of milk for him, and put it on the floor.
Peggy sat down on the carpet to watch him take it. His little red
tongue was so rough and funny, she laughed out aloud at seeing it
dart in and out of the milk. Patrick never paused for a minute till he
had licked the saucer so dry that you would have thought it had been
washed. Then he licked his long, yellow whiskers, and walked away
to the other end of the room, jumped on to the sofa, and was fast
asleep in a minute. Peggy wanted to waken him, and make him play
with her; but Aunt Euphemia wouldn’t allow her. As her own tea was
brought in at that moment, however, she became interested in it.
Martin came in with Peggy’s pinafore, and glanced at the tea-tray
while she put it on. “I’ll just bring a kitchen cup for Miss Peggy,” she
said, adding aside to Aunt Euphemia, “She’s an awfu’ breaker!”
Peggy blushed hotly. She knew that she often broke things, but it
was horrid of Martin to remind Aunt Euphemia of it just then. She had
wanted to take tea out of one of those nice cups with the roses on
them; it wouldn’t taste a bit nice out of a kitchen cup. But it was of no
use to object. Martin always had her way, so the kitchen cup was
brought, and an ugly kitchen plate also. It was wonderful how good
tea tasted after all, and the strange bread had a nice salt taste, and
the strawberry jam was different too. Altogether, Peggy enjoyed tea
very much.
When it was done, she went across to the sofa to see what
Patrick was doing. He opened his green eyes, and looked at her
sleepily. One of his paws was lying out on the cushion. Peggy took it
up in her hand and felt the funny little pads of black skin on his feet.
She knew, because she had a cat at home, that if you give a cat’s
paw ever such a tiny squeeze with your hand, its claws pop out from
between the little pads of black skin. She had sometimes done it to
old Tuffy at home; so she gave Patrick’s paw the tiniest squeeze
possible, just to see the claws slide out from their sheaths. But
instead of receiving this in Tuffy’s kind way, Patrick put out his paw in
a furious rage at her, and buried all his claws in her arm. Oh, what a
howl Peggy gave, and what long, red scratches appeared down her
arm! Then Patrick jumped down from his pillow with an angry fizz,
and walked out of the room.
Aunt Euphemia rang the bell without a word.
“Martin,” she said, “put Miss Peggy to bed; she has been teasing
Patrick!”
And Peggy, sobbing with pain, went off to bed.
CHAPTER II.
THE WASPS.

ou will not have read even as much as this without


finding out that Peggy was always getting into trouble.
And indeed it was her nature to do so, poor dear,
though it seldom was through any serious fault on her
part. The first evening of her visit to Seafield had
ended in this fight with Patrick, and the next morning
something much worse happened. I must tell you all about it.
The sun was shining very brightly next morning, and Peggy felt
as happy as possible. On the way downstairs she met Patrick; and
because she was very sweet-tempered and forgiving, she sat down
on the top step at once, and held out her hand to him—a little warily,
of course.
She was delighted to see that Patrick, too, wanted to be on
friendly terms. He came and rubbed his head against her and
purred. So they made it up, and Peggy ran downstairs.
“May I play in the garden, auntie?” she asked at breakfast.
Aunt Euphemia considered for a moment. “Yes, if you do not
leave the garden, and do not tread upon the flower-beds, or gather
the flowers,” she answered at last.
Peggy did not much mind these regulations. It looked so
delightful out there in the sunshine that she wanted nothing else. So
when breakfast was over, she ran out and began to wander about,
looking at all the new things—quite new most of them were to her.
Different flowers grew here from those that filled the garden at home,
and they were so nice to smell, even if she might not pick them. In
one corner grew a bush of a great feathery shrub that she had never
seen before. She walked round and round it, and longed to have one
of the long feathery switches for a wand, such as fairies use.
Just as she was thinking how much she would like this, a young
man came across the lawn with the mowing-machine. He looked
good-natured, Peggy thought, and she wondered if she might ask
him about the wand. She did not know his name, however, and felt a
little shy. She stood still, with her finger in her mouth (a bad habit she
had), and watched him while he poured oil into the little holes of the
mowing-machine. Then she summoned up courage to speak to him.
“Man,” she said, in a very shy voice—“man, I would like one of
these branches for a fairy-wand; do you think I might have one?”
She pointed to the bush.
He looked up with a grunt and a laugh, flung down the oil-can,
and drew a big clasp-knife out of his pocket. “One o’ thae yins?” he
asked in a kind voice.
She nodded, and pointed to the branch she specially desired.
“What’s your name, please?” she asked.
“James, missie,” he said, hacking away at the branch while he
spoke, and in a minute he handed her the lovely long spray she had
wanted.
Oh, what a wand it was!—longer a great deal than herself, and so
supple that it bent just like a whip.
“See here, missie,” said James; “ye’ll no can manage it that way;
I’ll peel it to ye.” He took the branch and began peeling off the outer
skin till it showed a satin-like white wood.
“Oh, let me peel!” cried Peggy; and together they peeled away till
the branch was bare—all except a beautiful bunch like a green tassel
at the tip.
With this in her hand, Peggy walked away across the lawn, and
you may fancy how delightful it was. She pretended she was a fairy
queen, and a touch of her wand would do whatever she chose. She
walked about muttering charms to the flowers, and then saw her
friend Patrick lying on a bank. She graciously extended the tip of her
wand to him, and he played with it for a minute quite like a kitten.
But then it struck her that she
would walk round the house. And
outside one of the windows she saw
the funniest thing hanging. It looked
like a little bottle made of flimsy gray
paper. She wondered what it could
possibly be; and standing right under
it, she poked up her hand and tickled
the mouth of the gray-paper bottle.
The next moment, she heard a terrible
buzzing noise, and a cloud of wasps
came flying down upon her. Peggy
never knew what she did. Down went
the wand, and she screamed aloud, for
the wasps were stinging her all over
her hands and face. The next moment
James came running up the bank to her. He caught her up in his
arms and ran across the lawn. They both seemed surrounded and
followed by the wasps, and a new sting came on poor Peggy’s face
or neck every moment. There was a gate in the garden wall, and
James ran to the gate, opened it, and crossed the road. The next
minute Peggy saw that he was wading into the sea with her and
dipping her under the water.
The wasps fell away in the distance, an angry, buzzing, black
cloud; and poor Peggy, more dead than alive, found herself being
carried back to the house, all her clothes dripping with the salt water.
James was dripping too, and moving his head in a queer way as if
his neck hurt him.
CHAPTER III.
THE DOCTOR.

hough it was only ten o’clock in the morning,


Peggy was glad enough to be put to bed at
once when she got back to the house. Martin
and Aunt Euphemia rubbed all her stings with
washing-blue and earth, and after that the
worst of the pain went out of them. But how
Peggy’s head did begin to ache! Then she got
sleepy, and had funny dreams, and woke up
crying, and couldn’t eat the nice dinner Martin brought up to her.
Martin was quite kind too, and tried to get her to eat; but it was no
use—she did not want anything. It was very hot too—oh, so hot,
Peggy couldn’t lie still, and tumbled about in bed. At last, just when
she was so hot that she sat up to see if that would make her cooler,
Aunt Euphemia came in, bringing with her a strange man, who laid
Peggy down on the pillows again, and took hold of her wrist with one
hand, while he held his watch in the other.
“This is the doctor, Peggy,” said Aunt Euphemia in explanation.
“Do the stings hurt you still, Peggy?” he asked, pulling up her
sleeves to look at the marks on her arm. But Peggy scarcely knew
what hurt her most, her head was so sore, and she felt so sick.
“I am going to make you quite well,” the doctor said; “but you
must take something nasty first.”
He looked at Peggy and laughed.
Aunt Euphemia looked very stern. “I will make her take it!” she
said.
“Oh, Peggy is too good to need to be made to take things, I’m
sure,” said the doctor.
Peggy sat up suddenly in bed.
“If you give it to me quick,” she said to the doctor, “I’ll take it!”
“Very well; here it is,” he said, shaking a powder into a glass, and
holding it out to Peggy.
Aunt Euphemia expected her to taste it and declare she couldn’t
take it; but Peggy drank the medicine right off without a word, and
lay down again.
“Poor little soul! Keep her in bed to-morrow, and I fancy she will
be all right next day,” said the doctor.—“Good-night, Peggy; go to
sleep, and if you are quite well on Thursday when I come you shall
have a ride on my horse.”
These were the last words Peggy heard, and she fell asleep very
soon, and slept all night long.
It is horrid to be kept in bed when one feels quite well. Peggy
wanted to get up and go out next day, and instead, had to lie still with
nothing to amuse her. The bed she was in was of a kind you never
see nowadays, with four huge mahogany pillars supporting red
damask curtains. It was just like sleeping in a tent.
Peggy found that by sitting high up on the pillows she could see
out of the window. The sea was right in front of the house, and a little
harbour filled with ships. There was a funny noise always going on at
the harbour, and Martin told her it was the ships being loaded with
coal. In the evening, just when Peggy was very dull, she saw a ship
with great white sails come floating along. There was scarcely any
wind, so every one of the sails was up, and it looked like a big white
bird. Then, as it came near the mouth of the harbour, it stood quite
still in the water, and a little steamer went puffing out to it. A rope
was thrown to the ship, and by this rope it was towed into the
harbour. Peggy could hear the men calling out to one another and
laughing.
“Maybe, if you are good, Miss Peggy, I’ll take ye down to the
harbour one day,” said Martin.
“Might I get on to one of the ships?” Peggy asked.
“No, no—dirty places—all coal-dust; whatever would Miss
Roberts say to that?”
“Oh, but I would like to be on a ship, and the coal-dust would do
me no harm,” pleaded Peggy.
“There’s nothing but dirty Germans on the ships, Miss Peggy—
speaking like monkeys, and rings in their ears—Spanish, and Dutch,
and Italian, some of them. No, no; it’s no place for you!”
Peggy said no more. But, would you believe it, she decided that
she must see these men with rings in their ears, who spoke like
monkeys, however she managed it. And with this thought she fell
asleep.
Dr. Seaton came on Thursday, and by that time Peggy was quite
well, and out of bed again.
“May I take her down the avenue on my horse, Miss Roberts?” he
asked of Aunt Euphemia. “I promised her that I would.”
“Oh, don’t trouble with the child,” said Aunt Euphemia. “I mean to
take her for a drive with me this afternoon.”
There was a moment’s
pause, and Peggy looked very
hard at Dr. Seaton—very hard
indeed. A drive with Aunt
Euphemia would be quite
different from a ride with him,
she thought.
“Mayn’t I take her? She shall
not get into any mischief,” he
said.
Peggy gave his hand a little squeeze to show what she felt about
it, and Aunt Euphemia consented.
Dr. Seaton’s horse was tied to a ring at the door—a high, gray
beast. It had taken a mouthful of the earwig roses, and was
munching away at them when Peggy came down the steps.
“O horse, there are such lots of earwigs in these roses,” she said
in disgust, “I am sure they can’t be nice to eat!”
Dr. Seaton laughed, and told Peggy the horse didn’t mind the
taste of earwigs a bit. Then he lifted her up on to the shiny saddle
that made a nice creaking noise, and gave her the reins into her own
hands, while he held her on. The horse stepped away down the
avenue so obediently, just as if he were quite accustomed to having
Peggy on his back. It was delightful, being so high up, and feeling
the horse move. Peggy thought it made up for the wasps.
“I’m glad the wasps made me ill,” she said, “or I wouldn’t have
had this ride.”
At the gate they came in sight of the sea, and Peggy
remembered what Martin had told her.
“Oh, Martin told me the men on the ships talked like monkeys
and had rings in their ears,” she said, “and I want to see them.”
“Have you never been on a ship?” Dr. Seaton asked.
“No, never. The sea doesn’t come near home, you know,” Peggy
explained.
“Well, would you like to come with me some day on to one?
Would Aunt Euphemia let you? I go to see a boy with a broken arm
on one of the ships. I’ll take you, if your aunt lets you come.”
Peggy was quite sure now that it was worth while being ill. Dr.
Seaton lifted her down off the horse, and told her to run back up the
avenue.
“I’d like just to kiss the horse’s nose first,” she said. “He has been
so nice.”
But Dr. Seaton suggested it would be wiser to pat him—just in
case he were to bite; so Peggy contented herself with this, and then
ran away up the avenue as pleased as possible.
CHAPTER IV.
THE WHITE STONES.

artin will put on your hat and jacket, Peggy,


and you will come out for a nice drive with me
at three o’clock,” said Aunt Euphemia at lunch.
This seemed a pleasant thing to do, but Peggy
did not look pleased. She sat quite still and
made no answer.
“Don’t you wish to come?” asked Aunt
Euphemia at last.
“No,” said truthful Peggy. The fact was, she
had found such a delightful new game that she
wanted to go on playing it all the rest of her life.
“What would you do if you stayed at home?” asked Aunt
Euphemia.
Peggy would not say. It spoils a game so much to explain it to
other people.
“I’d just like to stay and play in the garden,” she said.
Aunt Euphemia was not at all pleased. She thought it was
because Peggy did not love her that she refused to go out with her.
“Very well,” she said; “of course, I do not wish to take a little girl
with me who does not care for me.”
Peggy felt sorry, but she couldn’t explain; it would have spoilt
everything, you know. She stood on the steps and watched Aunt
Euphemia drive away, and then she clapped her hands, and danced
off into the garden. A flight of old stone steps led down from one part
of the garden to another; beside the steps there was a rockery, and
Peggy had found among the stones a lot of lumps of soft white chalk.

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