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March 2015

​What is a fragile state?

Anne-Lise Klausen's picture
Much like Tolstoy’s quip that each 'unhappy family is unhappy in its own way', a fragile state is fragile in its own way (see this paper, by the World Bank’s Michael Woolcock for more). Therefore, it is all too often unhelpful to reduce the definition of fragility to standardized, static lists or indicators – in so doing, we miss the complexities and nuances of fragility in some situations, and miss other fragile situations all together.
 

The 2014 Global Findex

Asli Demirgüç-Kunt's picture

The Little Data Book on Financial Inclusion I’m thrilled to announce the April 15 launch of the 2014 Global Findex database, the world’s most comprehensive gauge of global financial inclusion. Drawing on interviews with almost 150,000 adults in over 140 countries, the Global Findex tracks worldwide changes in account ownership and explores how adults save, borrow, make payments, and manage risk. Financial inclusion, measured by the Global Findex as having an account that allows adults to store money and make and receive electronic payments, is critical to ending global poverty. Studies show that broader access to, and participation in, the financial system can boost job creation, increase investments in education, and directly help poor people manage risk and absorb financial shocks.

Our research updates the first Global Findex database, which the World Bank launched in 2011 in partnership with Gallup, Inc. and with funding from the Bill & Melinda Gates Foundation. Their continued support made it possible to add new features to the second edition of the database, including more nuanced questions on mobile banking and an extended module on domestic payments. The 2014 Findex for the first time sheds light on how adults use accounts — and what can be done to have people become more active users of the financial system.

There is much good news to report…. But to learn the details, you’ll need to follow our data launch during the annual World Bank-IMF Spring Meetings.

​Important experiences and lessons from integrated fare systems

Jorge Rebelo's picture
Although integrated modal fares are important innovations for low-income riders, these systems can be plagued by many problems.

For example, in Rio de Janeiro — despite efforts by the government to convene all transit operators during the planning stage —private rail-based operators were reluctant to participate in the design of the system because they feared that the bus system would stand to benefit more from integrated fares.  In the end, the government went ahead with its plans.

Today, although the integrated fare system benefits the poor, it fosters the inefficiency of inter-municipal buses that receive a subsidy that allow them to survive despite low load factors. Several of those routes should have been integrated with rail. There was also fraud by van operators using transport routes and the system’s smart cards. Consequently, the subsidy rose very quickly. 

Even so, Rio de Janeiro’s system is a blessing to low-income users, and overall ridership increased. If challenges are met, the system can work better for everyone. Efforts must be done to fine-tune the system, close loopholes, decrease fraud and reward the most efficient parts of the system.

In my previous blog entry, I wrote about nine suggestions for designing and implementing integrated fare systems. Now, in addition to the initial example from Brazil, I’d like to share a few other experiences and lessons regarding integrated modal fares.

When there is a regional transport agency, an integrated fare system’s level of service can be monitored from a central location, provided buses are equipped with GPS and smart card systems (as in Santiago, Chile).

Business training for small enterprises in developing countries: does it work?

Suresh de Mel's picture
What helps small businesses grow? In January 2009, two colleagues (David McKenzie and Chris Woodruff) and I began an experiment that examined the effects of general business training on current and potential female small business owners in urban Sri Lanka.We found that small business training helps potential owners to open businesses more quickly and helps to improve their business outcomes. But generating re-investable profit growth in subsistence-level female-run businesses remains a challenging task.  
 

Global Daily: U.S. initial jobless claims slid to five-week low

Global Macroeconomics Team's picture
Financial Markets

Oil prices rallied on Thursday after Saudi Arabia and its allies started air strikes in Yemen, boosting demand for safe-haven assets from gold to Japanese yen. Brent crude surged more than $3 to close to $60 a barrel, and the price of U.S. crude saw a similar surge as it topped $51 a barrel. In the currency market, the dollar weakened against traditional safe-haven currencies such as the Swiss franc and the yen. Meanwhile, gold prices climbed 0.6% to pace gains among metals.

Strengthened accountability in a changing world

Gonzalo Castro de la Mata's picture

Gonzalo Castro de la Mata, Chairman of the Inspection Panel at the World Bank, shares his thoughts on the Panel's new Pilot for Early Solutions and describes its success in the Sustainable Agriculture and Rural Development Project in Paraguay.

Roman archesRichard Branson believes in accountability. When he founded Virgin Galactic, the first company to offer commercial trips to space, he promised to be on board during the inaugural flight so that he would be the first saying “oops” if need be (let’s hope not). Similarly, the tradition is that the Captain of a ship is the last one to abandon it, if things go wrong, and to go down with it if necessary (the Captain of the “Costa Concordia” being a recent exception to this rule). In earlier times, Roman engineers stood under the arches they designed as the capstone was set in place, so that the full force of their mistakes would be unleashed upon their heads. Regardless of the definition of accountability used, spotting it is easy when it is there.

The Inspection Panel was designed more than 20 years ago, at a time when both the Bank and the world were quite different. Today, information travels instantaneously, and the challenges of development are ever more pressing and complex. This new world demands ever stronger levels of accountability. At the Panel, we define successful accountability as the process through which redress is provided to people that have suffered harm when things have gone wrong, and lessons are learned by the Institution so that the same mistakes are not repeated.

One example of successful accountability is the recently concluded Sustainable Agriculture and Rural Development Project (PRODERS) case in Paraguay. This is a Bank-financed project aimed at supporting participatory rural development with indigenous populations. Last July, we received a complaint from indigenous people from the Departments of San Pedro and Caaguazú in Paraguay claiming that consultation within the PRODERS project had broken down. Through discussions with World Bank management, we learned that the project team had developed an Action Plan geared to working closely with the government to resolve the impediments for effective indigenous participation. We also learned that the requesters wanted a quick solution to their participation problems, rather than to wait for the results of a potentially lengthy Panel process.

Dispelling myths about surgery’s role in global health

Paul Farmer's picture



The past few decades have seen enormous changes in the global burden of disease. Although many people, especially those living in (or near) poverty and other privations, are familiar with heavy burdens and much disease, the term “global burden of disease” emerged in public health and in health economics only in recent decades. It was coined to describe what ails people, when, and where, and just as reliable quantification is difficult, so too is agreeing on units of analysis. Does this term truly describe the burden of disease of the globe? Of a nation? A city?

Updating the renewable energy lexicon

Oliver Knight's picture
Photo by ffennema via iStock
A just-published report by the World Bank’s Energy Sector Management Assistance Program (ESMAP) on the integration of variable renewable energy (VRE) into national grid systems shows once again that adding solar, wind and other forms of VRE does not represent the calamity for grid operators or the high costs that are frequently claimed, particularly in mainstream media. In fact, with proper planning, integrating relatively high levels of renewable energy generation into a large, interconnected grid is feasible at modest incremental cost.

This is important because with the cost of renewable energy continuing to fall, VRE is looking increasingly attractive. Just consider the recent results from South Africa’s renewable energy auctions.

Why then does the discourse around renewable energy continue to view it as a pesky annoyance at best, and a costly gamble at worst? Terms such as “intermittent” and “backup” are often used to pour cold water on the contribution that renewable energy might provide or to question the reliability of solar or wind generation. In addition to the damage they inflict on efforts to promote clean energy, they hint at a very conventional view of electricity systems that is rapidly becoming outdated.

Taking these two particular terms in turn, let us explore them in more detail.

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