Do economic incentives crowd out individuals’ intrinsic motivation for certain activities that are performed in the absence of explicit rewards, such as volunteering in soup kitchens, recycling, or giving blood? This is an important question with implications for public policy and has been explored on Development Impact with a number of recent posts (here is the latest one from Jed).
Bangkok is a vibrant, cosmopolitan city, home to more than eight million people. However, a new report released by the World Bank today paints a grim picture for the Thai capital. It notes that, without adaptation, a predicted 15cm sea-level rise by the 2030s coupled with extreme rainfall events could inundate 40% of the Thai capital and almost 70% of Bangkok by the 2080s. While I certainly hope it doesn't happen, words cannot describe the impact this would have on the lives and livelihoods of people residing in this city. And Thailand isn’t the only country that could be affected by rising temperatures.
The report - Turn Down the Heat: Climate Extremes, Regional Impacts, and the Case for Resilience - was commissioned by the World Bank’s Global Expert Team on Climate Change Adaptation and prepared by a team of scientists at the Potsdam Institute for Climate Impact Research and Climate Analytics. It looks at the latest peer-reviewed science and with the aid of advanced computer simulations looks at the likely impacts of present day (0.8°C), 2°C, and 4°C warming across three regions – Sub-Saharan Africa, South Asia, and South East Asia. It focuses on the lives and livelihoods of people in the developing world by analyzing the risks to agriculture and food security in sub-Saharan Africa; the rise in sea-level, bleaching of coral reefs and their impact on coastal communities in South East Asia; and the impact of fluctuating rainfall patterns on food production in South Asia. The poor and the vulnerable are the ones that will be most affected by the impacts of climate change.
Recently, I participated in several events that look at the space between empowered government (gov2.0) and empowered citizens (citizen2.0 both individuals and civic groups and NGOs).
One discussion was around tapping into networks of empowered citizens clustering around different issues for open policy making (Masters of Networks, Venice) and another on getting human-readable stories from data (Open Data on the Web, London).
Then, there was a question on how open data and modern technologies can improve environmental sector governance (#ICT4ENV, Cetinje), or strengthen political transparency and accountability (Point 2.0, Sarajevo).
Different countries, different venues, different leading institutions – but a common set of issues that I struggle with and that, I hope, will emerge as topics in some future events (one of those, shaping up to be the policy making 2.0. deluge in Dublin, is coming up this month).
Sovereign difficulties have divided financial markets in the Euro area, thereby increasing differences in bank lending rates across countries. Policy makers in both Brussels and Frankfurt are concerned about an uneven transmission of policy interest rate cuts by the European Central Bank (ECB) to bank lending rates across the region.
Based on this situation, a key question stands out: is the link between official, market, and retail interest rates broken?
When markets are functioning properly, interest rates on loans follow the policy rate in a uniform way across countries (granted with some lag). But, in the context of the ongoing crisis, markets became somewhat irresponsive – resulting in ECB rate cuts being unevenly passed on to borrowers across Euro-area countries. This uneven distribution has meant that those countries facing greater financial difficulties had to endure tougher financing conditions than those facing fewer difficulties – as exemplified when comparing Spanish and Italian retail rates to the much-lower French and German ones.
So far, the economic literature has been relatively robust in arguing that government bond yields or credit default swaps (CDSs), given their stability, do not exert much influence on the way banks set their interest rates for their clients. However, the crisis has shown that because of the interconnectedness of central bank and sovereign balance sheets, developments in sovereign markets affect retail interest rates.
How has this played out in the EU11 countries? Have retail interest rate decreased in those countries where central banks reduced their policy rates? Or, was this a reaction on downward movement of CDSs?
Figure 1. Interest rates on new lending to enterprises (in Percent) and CDS spreads (in basis points) in selected EU11 countries
In many parts of the world, border-crossings are more than just an annoyance for women traders. Women can be subject to physical and sexual abuse from border officials, or charged illegal fees because they cannot read a receipt. Yet women traders are vital to some of the poorest economies in the world.
In addition to – and perhaps related to – the heightened risks women take in cross-border trade, they are underrepresented in the institutions that manage those borders. Men dominate the ranks of customs officials around the globe. One recent count estimated just 45 women in leadership positions in customs administration worldwide.
The World Customs Organization (WCO) is trying to change that statistic. On July 1, the WCO, with support from the World Bank, will hold a conference in Brussels to stimulate a conversation about women in customs - about their empowerment through both trade and public administration. Called the Women in Customs, Trade and Leadership Conference, the day-long agenda will address the hurdles faced by women in a wide range of roles, from informal traders to customs officials.
Thirty-five organizations will be awarded $800,000 by the Egypt Development Marketplace (DM) funded by The World Bank Group (WBG) and its local and international partners. Each of the grantees will receive $25,000 to scale up their business model that would generate employment in the agriculture and handicraft sectors. Winning organizations will beshowcased at a DM sponsored event. A number of financial institutions, social entrepreneurs, investors, development organizations, and government officials will also participate in the event to bring attention to organizations implementing innovative solutions to unemployment in the country.
Overwhelming response to “Call for Proposal”
The call for proposals was launched in November and closed in January. At closing, 180 proposals from 171 organizations were submitted for funding. Preference was given to projects implemented in Upper Egypt and the majority of proposals were for projects in Minya. Applicants comprised the following types of organizations: 89 percent were Non-governmental Organizations (NGOs), 7 percent were private companies and 4 percent were foundations.
From its conception, the Egypt DM has been designed to surface and build the skills of organizations creating jobs in the country, primarily in the poorest areas with an emphasis on Upper Egypt. To generate interest in the competition and to ensure organizations operating in targeted areas applied, outreach events were held in Assyut, Qena, Aswan, and Minya. As a follow up, skill-building workshops in business planning were held for each of the 70 finalists to ensure high quality proposals were submitted.
Climate change is definitely upon us. You don’t need to have a scientific mind to realize this, as recent natural calamities have shown in the Philippines, which also swept through some parts of Southeast Asia causing hundreds of casualties and losses to the economy: Typhoons Ondoy (International name: Ketsana) and Pepeng (Parma) in 2009 that flooded Metro Manila; Sendong (Washi) in 2011 which was recognized as the world’s deadliest storm in 2011; and Pablo (Bopha) in 2012. Certainly, this is a little discomforting and makes us a little bit apprehensive about our future. To lessen our anxiety about this phenomenon, it helps to ask questions and get answers. It’s also good to know if something is being done to address the problem – and know that it is being done right.
The Aquino government has been very aggressive in its approach to address the problem of climate change. It staffed the Climate Change Commission (CCC) and made it functional. The CCC coordinates and provides oversight and policy advice on programs and projects on climate change. It is also tasked to craft the National Strategic Framework on Climate Change and the National Climate Change Action Plan (NCCAP). The latter serves as the country’s roadmap to effectively deal with the problem. The CCC also takes a strong stand in international negotiations to reduce greenhouse gas emissions.
Connectivity is paramount for landlocked developing countries (LLDCs). In his famous book The Wealth of Nations, Adam Smith argued that specialization is the key to productivity gains. In order for these gains to materialize, however, access to markets and the development of trade have to be ensured.
Businesses create jobs and spur growth. But businesses can do more. As competitive pressures increase and as resources around the world become harder to sustain, foresighted businesses have started to adopt new, collaborative and open private sector practices that accomplish two goals at once: improve the bottom line and increase development impact.
The reason businesses do this? Not because of old do-gooding principles, but because solving development issues around the value chain becomes a crucial part of doing business through crowd-sourcing innovations, reducing cost and managing risk.
But the questions are, how can practices that benefit both the bottom line AND development, be scaled up? Can we encourage mass-adoption of the sustainable approaches that IFC has been promoting for years? How do we mainstream that which Michael Porter has called “Creating Shared Value”? How do we go from a few smart companies to millions adopting open and collaborative practices?
To begin answering these questions, the World Bank Institute is launching the “Open and Collaborative Private Sector” initiative. This will complement efforts that others at the World Bank and elsewhere have been advancing on Open Aid, Open Data and Open Government.
With as many as 12 million mobile phone users, mobile is booming in Afghanistan (Credit: USAID, Flickr Creative Commons)
Afghanistan has made significant progress in its development since 2001. Yet, these achievements remain fragile due to a volatile security situation and limited human capacity. Of an estimated 30 million inhabitants, 46 percent is under the age of 15 and with high population growth, the country is experiencing a classic youth bulge. In addition, literacy rates remain at extremely low levels (approximately 43% for men and 12% for women).
Canadians are supposed to be good in a few things: skating, painting trees and rocks, welcoming newcomers, writing engaging stories that surely must have a meaning in there somewhere, and paddling a canoe. The canoe—a bit like the moose—holds an almost mythic place in the Canadian psyche. Anything and everything can be compared to canoeing. This metaphor is apt when applied to city administration.
An experienced and comfortable pair of paddlers can take a canoe almost anywhere and through whatever waves, winds and rapids that might arise. Over any sort of distance, solo kayakers with their fancy paddles and cramped storage compartments are no match for a canoe with tandem paddlers. Canoeing is the most efficient and gracious way to travel on open water—the secret to good canoeing, as with city administration, is good communication and a ‘little-little, big-big’ approach.
How political is development assistance? How political should it be? These questions provoke divergent reactions within the aid community. For some, being political means using aid to advance geopolitical interests aside from development. Others emphasize the far-reaching political consequences aid can have on recipient countries, from bolstering dubious strongmen to undermining systems of domestic accountability. These two perspectives highlight how aid’s political motivations or side effects can limit its effectiveness in advancing developmental change.
Yet in recent years many development practitioners and scholars have been arguing that aid should become more, not less, political. What do they mean by this? They are not talking about political side effects or prioritizing geostrategic motives. Rather they are referring to efforts by development aid actors intentionally and openly to think and act politically for the purpose of making aid more effective in fostering development.
As we chronicle in our new book, Development Aid Confronts Politics: The Almost Revolution, donors have increasingly incorporated politics into their work in two major ways. First, they now pursue explicit political goals in developing countries, whether expressed as advancing democracy, democratic governance, or effective governance. Second, they are trying to adopt politically smart methods, moving away from the idea of aid as a narrowly technical input to considering it a facilitating agent of local processes of change, which requires aid providers to conduct political analyses, adapt programs to local political contexts, and reach a diverse range of socio-political actors within developing countries.