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Let’s Talk Development one year on + an invite to readers

Justin Yifu Lin's picture

What kinds of countercyclical policies make the most sense during financial crises? Can going ‘beyond Keynesianism’ by investing in infrastructure restart worldwide demand and help avoid a double dip recession? How can you sort good industrial policy from bad? Is it more important to focus on pragmatic development lessons from other emerging market countries, or should researchers spend most of their time on randomized control trials and experimental approaches to evaluation? These and many other questions were explored during the first year of ‘Let’s Talk Development,’ which we launched on September 28, 2010.

We went live with this blog on that day because it was when World Bank Group President Robert B. Zoellick delivered a speech on ‘Democratizing Development Economics’ at Georgetown University. This blog aimed to attract commentary and insights on breakthrough solutions to development challenges as well as to transmit some of the newest thinking taking hold in the field of development economics. 

The education of a gender skeptic: what I learnt from the WDR 2012

Ana Revenga's picture

Before I started working on the World Developmnet Report 2012 (WDR), I often thought of gender equality being at the periphery of my work on development.  Like many other World Bank colleagues, I would have told you: “Yes, gender equality matters and it is a good thing.”  But in my mind gender equality was something that happened pretty much automatically with economic development.  If asked about policy priorities, I would say: focus on growth, on creating jobs, on reducing poverty and improving equity in opportunities, and gender equality will come right along.  But I was wrong. Gender equality is not just something that ‘happens’ with development. Gender equality is both fundamental to and a means for development.  And countries need to work hard at achieving it, because it does not come about on its own with economic growth.

In Nigeria, One Size Doesn’t Fit All

Volker Treichel's picture

I blogged a few months ago about a paper Justin Lin and I were writing that focused on applying  the Growth Identification and Facilitation Framework in Nigeria.  The paper has just recently been completed and is now available online.

In the meantime, attacks on the UN house in Abuja have highlighted the extreme social tensions experienced by Nigeria. Many of these tensions may be related to the country’s persistent poverty. In fact, notwithstanding high and sustained growth over the past decade, Nigeria’s job creation has barely kept up with the relentless growth of its workforce, and youth unemployment has further risen.  Moreover, formal sector employment has fallen, as a result of privatization and civil service retrenchment, while employment in informal family agriculture has increased. 

Nigeria urgently needs to increase employment intensity and sustainability of its growth performance, and our paper can be a useful tool for developing a strategy to do so. 

Bears, boots and long-run growth

Justin Yifu Lin's picture

Photo: istockphoto.comJackson Hole was abuzz last week as top economists rubbed shoulders with central bankers, but the stuffed bears in the lobby of the venue seemed symbolic of the angst permeating world markets.

In spite of this, the participants got down to business and I was not alone in thinking that today’s financial market turmoil and the anxiety over high unemployment in the United States and over European debt should be treated by the economics profession as an opportunity to think differently about solutions for kick-starting growth. 

Today’s uncertainty should spur policymakers to take new economic ideas and build a social consensus for action. An ambitious, innovative approach is needed otherwise the crisis will likely be with us for some years. Indeed, the US and EU could face a Japan-style scenario, with prolonged recession and a high level of public debt.

Low Female Participation in the Workforce: Solving the Turkish Dilemma

Asli Gurkan's picture

During his July 19-22 visit to Turkey, World Bank president Robert B. Zoellick put his finger on a key issue, female participation in the Turkish workforce. It wasn't a coincidence that Zoellick commended Turkey's remarkable economic performance and spoke of the gender-gap in Turkey concurrently. The Turkish case presents a dilemma. Despite Turkey's successes in macroeconomic stability and poverty-reduction, the participation of women in economic life is abysmal.

How to Seize the 85 million Jobs Bonanza

Justin Yifu Lin's picture

Remember the famous joke about an economist who believes so much in rational expectation theory that he would not pick up a $100 dollar bill off the sidewalk under the pretense that if it were actually there someone would have already picked it up? A similar excuse may be invoked to justify why low-income countries that are currently facing high underemployment are not organizing themselves to seize the extraordinary bonanza of the 85 million manufacturing jobs that China will have to shed in the coming years because of fast rising wages for unskilled workers.

Economic development is a process of continuous industrial and technological upgrading in which each country, regardless of its level of development, can succeed if it develops industries that are consistent with its comparative advantage, determined by its endowment structure. As I explained in an earlier blog post for China to maintain GDP growth of nearly 10 percent a year in the coming decades, it must keep moving up the value chain and relocate many of its existing labor-intensive manufacturing industries to countries where wage differentials are large enough to ensure competitiveness in global production networks.

Uzbekistan explores a path to growth

Justin Yifu Lin's picture

Does a remote double-landlocked Commonwealth of Independent States country have the potential to grow at 8 percent a year for the next 20 years? Call me an optimist, but I have just been to the country and I am convinced it’s true. My lecture to a packed audience in Tashkent on ‘Uzbekistan: New Strategies and Opportunities for Structural Transformation’ was well received. Perhaps they were just being extraordinarily polite hosts, but officials there thought my visit marked a transformation point and at the end of my visit, they said they’d start working on a long-term development vision report together with the World Bank and their think tanks.

The recipe for dynamic growth in a developing country is to tap into latecomer’s advantages by developing industries in accordance with its comparative advantages in a well-functioning market economy with the state playing a facilitating role. In the case of Uzbekistan, the potential of late comer advantages have been enormous in many sectors including the traditional ones, such as carpet, garment and horticulture, and modern ones, such as consumer electronics and cars. I visited a carpet factory in Samarkand. Impressed by the owner’s entrepreneurship and the abundant supply of well-educated, disciplined, wage-competitive workers, I am convinced Uzbekistan can out compete Turkey as the world’s production center of synthetic carpets in the coming years.

Managing Capital Flows

Shahrokh Fardoust's picture

With sluggish growth in advanced economies, much investment money is heading south to more favorable climates. And while capital flows can provide greater opportunities for emerging and developing economies to pursue economic development and growth, capital inflows can also pose some serious policy challenges for macroeconomic management and financial sector supervision. Recently, large capital inflows in some middle-income countries have placed undue  upward pressure on their currencies, adversely affecting  macroeconomic and financial system stability as well as export competitiveness in a number of  these countries. Furthermore, the pro-cyclical nature of global capital flows to emerging and developing economics can serve to aggravate these risks.

China’s Special Economic Zones and Industrial Clusters: Success and Challenges

Douglas Zhihua Zeng 曾智华's picture

In the past 30 years, China has achieved phenomenal economic growth, an unprecedented development “miracle” in human history. Since the institution of its reforms and Open Door policy in 1978, China’s gross domestic product (GDP) has been growing at an average annual rate of more than 9 percent (figure 1). In 2010, it has surpassed that of Japan and become the world’s second-largest economy.

Structural Change, growth and jobs

Merrell Tuck-Primdahl's picture

Structural transformation is a key determinant of productivity growth and explains two-thirds of the difference between superior East Asian growth and more muted Latin American growth in the past two decades.

Given the multi-speed paths that regions and countries take as they transform, with some succeeding spectacularly and some struggling to compete, it may be time to consider new industrial and labor policies to ensure that a huge swath of the lower middle class in the developing world doesn’t get left behind in the race to compete in today’s unforgiving global marketplace.

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