East Asia and Pacific
Last month, the World Bank and IMF both put out predictions that, this year, India would overtake China in terms of GDP growth rate. This caused a flutter and was widely reported around the world. How robust is this prediction and what does it really mean?
First, this is not as monumental a milestone as some commentators made it out to be. China has had one of the most remarkable growth runs witnessed in human history, having exceeded an annual growth of 9% from 1980 to now. Four decades ago its per capita income was close to India’s, but now it is four times as large as India’s. None of all this is going to change in a hurry.
With this caveat in mind, it is a year in which India deserves to feel good. It is expected to top the World Bank’s chart of growth rates in major nations of the world. This has never happened before. Before 1990, India did occasionally grow faster than China, mainly because China’s growth gyrated wildly during the pre-Deng Xiaoping period. It was, for instance, minus 27% in 1961, when Mao Zedong’s Great Leap Forward resulted in the world’s biggest famine, and it was 17% and 19% in 1969 and 1970, respectively--a relief in the wake of the Cultural Revolution. Fluctuations of this magnitude would be intolerable to India’s polity.
How does Serbia fare on gender equality in the labor market? Did it manage to sustain some of the achievements of the former socialist regime, such as equal access to education opportunities, equal treatment of men and women in the labor law and high employment rates of men and women? The analysis of the recent labor force and enterprise surveys shows that although men and women have similar education levels and enjoy equal treatment in the labor legislation, there are major gender disparities in access to economic opportunities:
It’s not every day that jumping monkeys and George Clooney are discussed in the context of a framework for development economics. But that’s exactly what happened on March 6 when Justin Yifu Lin presented his book, ‘New Structural Economics: A framework for Rethinking Development Policy’, with Regional Chief Economist for Africa Shanta Devarajan moderating and Harvard Professor Ricardo Hausmann providing a lively counterpoint as discussant. Justin made an impassioned case for how industrial structure is endogenous to endowment structure, arguing that following comparative advantage and involving the state as a facilitator can be the ticket to income growth and poverty reduction. Hausmann argued that comparative advantage is not determined by an economy’s broad endowment of factors, but by what you know how to do. He also argued that imitation (for example, if George Clooney wears a brand of cologne, other men would wear it too) and moving preferentially towards nearby goods (the jumping monkey analogy) are powerful drivers of innovation and success in industry. Watch the video to get the full narrative or download the Powerpoints here.