Recently three IMF economists published a paper arguing that redistribution is in general pro-growth (Ostry et al. 2014). The paper caused a stir as it dismisses right-wing beliefs that redistribution hurts growth. However, even people sympathetic to the ideas of inclusive growth and equality of opportunity find this finding problematic. One reason is that the authors rely on a measure of redistribution that misrepresents the true cost of redistribution in an economy. Another has to do with the omission of factors that affect positively the income growth of the poor and vulnerable, such as employment. This omission would exaggerate the importance of equality through redistribution as a source of growth and underplay the importance of structural transformation and investments directed towards sectors that use unskilled labor more intensively, and therefore have the potential to generate inclusive growth and productive employment for the poor segments of the population.
Last January, Egypt and Tunisia enacted new constitutions in the context of the political changes they have been witnessing since the 2011 revolutions that overthrew the Mubarak and Ben Ali regimes. While most public attention has focused on how these constitutions have addressed hotly debated issues such as the structure of government, the role of religion and fundamental freedoms, there has been relatively less attention to how they have dealt with economic and social issues. In this regard, it is noteworthy that the two constitutions contain clauses which give high priority to building a knowledge economy and which provide for the protection of intellectual property rights (IPRs), at the constitutional level, for the first time in the history of these countries.
“It is not what you know that matters, it is who you know” is how the old adage goes, and so I have observed from my conversations with family and friends during my recent visit back to my hometown in East Jerusalem when I asked what they thought of the often heard complaint among Arab youth that “wasta” is all that matters in landing a decent job nowadays.
- Social Development
- Labor and Social Protection
- Middle East and North Africa
- Yemen, Republic of
- West Bank and Gaza
- United Arab Emirates
- Syrian Arab Republic
- Saudi Arabia
- Iran, Islamic Republic of
- Egypt, Arab Republic of
Equality for women means progress for all. That is this year’s theme for International Women's Day, which falls on March 8 every year. To mark the occasion, we asked women from across the Middle East and North Africa region to share their views on what it's like being a woman in the Arab world; the challenges they face and what they need most to overcome them. After reading their views, we invite you to share yours.
In last week's op-ed for the Washington Post, World Bank Group President Jim Yong Kim provided the broader context for the Bank's concern about discrimination in general, and more specifically about anti-gay laws: "Institutionalized discrimination is bad for people and for societies. Widespread discrimination is also bad for economies. There is clear evidence that when societies enact laws that prevent productive people from fully participating in the workforce, economies suffer."
On February 18, 2014 in Tunis, the results of a diagnostic study for the development of ultra-fast broadband in Tunisia were presented to all the key actors in the sector. Financed by the Arab Financing Facility for Infrastructure (AFFI), this study (which is not yet available) proposes as a vision for Tunisia a target of 50 percent ultra-fast broadband coverage for the population in 2020 and 100 percent coverage in 2025, while focusing in the short term on priority targets for such as communities, businesses, academic institutions, health centers, and post offices.
The issue of affordable connectivity gained prominence last week when photographer John Stanmeyer won World Press Photo of the Year for his eloquent picture of people standing on a beach at night in Djibouti, trying to access cheaper wireless service from neighboring Somalia. In a new study “Broadband Networks in the Middle East and North Africa: Accelerating High –Speed Internet Access” (launched February 6 in Abu Dhabi) my colleagues Carlo Maria Rossotto, Michel Rogy and I looked at prices and other market structures in places like Djibouti when we set out to understand what it will take to expand broadband internet in the Middle East North Africa (MENA) from its current low base.
In terms of the World Bank’s twin goals of eliminating extreme poverty and boosting shared prosperity, the Middle East and North Africa Region was making steady progress. The percentage of people living on less than $1.25 a day was 2.4% and declining. And the incomes of the bottom 40% have been growing at higher rates than average incomes in almost all MENA countries for which we have information.
Yet, there were revolutions in several countries and widespread discontent. Why?
Photo: "January 25th is the best and most honorable day in the history of Egypt"
In the World Bank office in Cairo, there is a beautiful poster that proclaims January 25th as the best day in history. I do not know its origin, but it looks like a drawing made in the heart of Cairo’s Tahrir Square during the January 25th revolution. Three years later, January 25th has a deep meaning in modern Arab history.
The announcement comes at a time when growth is slow, unemployment is high and the economy is still suffering from already ballooning subsidies -amounting to 9 percent of GDP- that have kept Egypt’s fiscal deficit at an exceptionally high 13.7 percent of GDP. At least seven countries in the Middle East and North Africa Region —including all those in transition after the Arab Spring (such as Egypt)--are trapped in a low-growth-poor-policy loop.