Is protectionism getting better or worse? Chad Bown, Senior Economist with the Trade and International Integration Team in the Development Research Group analyses recent World Bank data from 24 major economies suggesting that import protection through temporary trade barriers — such as antidumping, safeguards, and countervailing duties — has increased considerably for a handful of mostly emerging markets in the past year. But the news is not all bad – some countries have lowered their trade barriers.
Every year, 2 million children die of diarrheal diseases worldwide. Chronic diarrhea contributes to malnutrition, stunting, and cognitive impairment. In Kenya, the Development Impact Evaluation team led an impact evaluation that tested different strategies to find effective low cost solutions to improve water safety. Chlorine dispensers at community water collection points raised the number of households with detectable levels of chlorine in their drinking water from 5 to 60 percent, compared to communities that had to rely on store-bought chlorine for purification.
The paradigm of community-driven development (CDD) aims to increase program impact by involving communities in the selection, design, and implementation of local development projects. However, its effectiveness can be undermined when local elites capture or otherwise exploit the paradigm’s prescribed participatory processes. In such cases, the type of projects implemented, as well as the benefits they provide, may end up serve the interests of elites, rather than the targeted communities. Large local landholders, for instance, may be more interested in funding irrigation projects than digging deep wells, building schools, or funding local clinics that benefit the community at large.
The 2012 World Development Report, Gender Equality and Development, argues that gender equality “contributes to economic efficiency and the achievement of other key development outcomes.” U.S. Secretary of State Hillary Clinton stated at the APEC Women and the Economy Summit that “the increase in employment of women in developed countries during the past decade has added more to global growth than China has, ” and argued that incorporating women into the formal workforce is critical for economic progress. Understanding how major policy changes affect women’s employment and the gender wage gap is therefore critical for implementing future policies that may affect women’s status and opportunities.
Sub-Saharan Africa (SSA) is home to the world’s poorest countries. The region’s geographical disadvantages are often viewed as an important deterrent to its economic development. A country’s geography directly affects economic development through its effect on disease burden, agricultural productivity or the availability of natural resources. However, the new economic geography (NEG) literature, initiated by Krugman (1991), highlights another mechanism through which geography affects prosperity.
The current US drought and its emerging effects on food markets underscore the timeliness and importance of this year’s Global Monitoring Report (GMR), which focused on international food prices, nutrition, and MDGs. One key message of the report, which should be taken on board when the emerging crisis is assessed, is that the effects of changes in international food prices depend on the time frame and on country characteristics, most importantly on shares of domestic supply that are exported or imported and the related issue of the extent to which domestic and international markets are linked. While it is possible for governments to mitigate the effects of international price changes, this can be quite costly, requiring higher taxes, more borrowing, or less spending in other areas, giving rise to difficult trade-offs between various competing development objectives. However, for most countries, given that food trade represents a small share of food supplies and demands, domestic conditions determine to a large extent whether sufficient food is available at prices that are affordable also for the less fortunate – it depends on household incomes and the ability of the agricultural sector to ramp up production. It is important not to exaggerate the role of international markets, especially beyond the short run, when farmers have had the opportunity to respond to international price developments.
Latin America’s economic performance has been improving steadily over the past decade. Driven by high commodity prices and capital inflows, growth rose above that in the G7 and also helped for the first time to reduce poverty and high income inequality. More than 70 million Latin Americans were lifted out of moderate poverty between 2003 and 2012 and at least 12 countries in the region experienced non-trivial declines in their income Gini coefficients. In parallel, the middle classes expanded and, as a result, income inequality fell throughout the region. The effectiveness of Latin America's economic reforms since 2000 was evidenced by the resilience of its economies during the recent crisis. In fact, the region's recession was relatively short-lived, and with the exception of Mexico, remarkably mild, partly as a result of effective counter-cyclical monetary, fiscal and credit policies made possible as a result of the sustained macroeconomic stabilization since 2000. Yet, Latin America remains trapped in a middle income status and has made little progress in converging to the per capita incomes of advanced countries (Figure 1).
Political intervention in credit markets, often with telling consequences, seems to be ubiquitous, regardless of the stage of development of the financial system. It has been well documented that in emerging markets, cozy ties between banks and politicians, as well as state ownership of banks, give rise to a great deal of political influence in credit extension and capital allocation. The recent financial crises in U.S. and the Eurozone have demonstrated that even advanced financial systems are not immune to political intervention.