I’ve suggested recently that although high economic growth in recent decades has greatly improved average life expectancy, infant mortality, and other leading indicators policymakers and development practitioners were still worried about the sustainability of these trends and whether people in developing countries would eventually enjoy the high standards of living of high-income countries. This, against the background of a planet under increasing stress, particularly as a result of climate change. In this blog, I explore some of the actions needed to sustain our global economy.
There is increasing evidence that labor markets in developed countries are polarizing or hollowing out. On the one hand, the share of employment in high-skilled, high-paying occupations (managers, professionals and technicians) and low-skilled, low-paying occupations (elementary, service, and sales workers) is growing. On the other hand, the share of employment in middle-skilled, middle-paying occupations (clerks, plant and machine operators) is being squeezed. There is ample evidence of polarization in the United States (see Acemoglu and Autor, 2011; Autor and Dorn, 2013; and Autor (2014) for a less technical discussion), and also in Western Europe (Goos, Manning, and Salomons, 2014). Harrigan, Reshef and Toubal (2016), more recently, document the same phenomenon in France, using firm-level data.
Conventional wisdom holds that Sub-Saharan African farmers use few modern inputs despite the fact that most growth-inducing and poverty-reducing agricultural growth in the region is expected to come largely from expanded use of inputs that embody improved technologies, particularly improved seed, fertilizers and other agro-chemicals, machinery, and irrigation. Yet following several years of high food prices, concerted policy efforts to intensify fertilizer and hybrid seed use, and increased public and private investment in agriculture, how low is modern input use in Africa really?
Last week, I participated in GE’s global conference, ‘Disrupt or Be Disrupted’. The theme of the event was simple. As barriers to entry fall in nearly every industry, no company is safe or immune from being disrupted in a fundamental way. It’s no longer uncommon that industry leaders lose their edge in months, and wither to irrelevance in record time. Unless corporates have the courage to embrace and empower their ‘creatives’ they don’t stand a chance in sustaining their competitive advantage.
Twitter, Facebook, SMS, and Crowdsourcing—2011 has certainly been the year in which the use of social media and technology has captured the world’s attention.
From Tahrir Square in Egypt to the Anna Hazare movement in India, citizens have demonstrated that they want voice and accountability. Innovations in social media, mobile phones and inter-active mapping are powerful tools to mobilize citizens and to provide people with a voice—thus broadening the political debate.
However, key questions remain unanswered: What role can these innovative tools play to encourage governments, donors and foundations to become more transparent, open and accountable? Can the use of social media and cell phones empower people and marginalized communities, and close the feedback loop, allowing citizens to directly report back on project results and participate in decision-making processes about the use of public funds? These are a few issues that emerge when analyzing the potential transformative power of technology on development.
Life before the web was neatly compartmentalized. Research was produced by researchers who wrote articles for academic journals; news was written up by professional journalists who wrote for newspapers and talked on news broadcasts on the TV and the radio; policy was made by politicians and policymakers behind closed doors in smoke-filled ministries in capital cities; and entertainment was crafted by professionals and delivered in theaters, cinemas and on the TV.
Countries of the Middle East and North Africa (MENA) are a cauldron of wrenching social change. For years pundits have attributed the region's tense social fabric to relatively high population growth rates, a lack of economic diversity, autocratic governments, and, in many countries, on an over-reliance on oil.
Howard Pack, eminent business and public policy Professor at the Wharton School, came to the World Bank earlier this week to share his views on the question of why MENA countries never came close to the equivalent of an East Asian miracle and how they might get on a more successful economic path.
There is an increasing consensus about the need of poorer economies to shift away from low technology, low productivity areas into new product areas, particularly to generate non-commodity exports. The figure below shows the low level of manufactured exports from the poorest region, sub-Saharan Africa (SSF) as well as from Southeast Asia (SAS) compared to other regions. It is this disparity that many have in mind in urging a sectoral transformation. In the 1950s and early ‘60s there was an argument for a “big push” in development premised on export pessimism.
|*lcn- Latin America & Caribbean, mea- Middle East & Africa, SAS - Southest Asia, ssf- Sub-Saharan Africa, eap- East Asia & Pacific, and eca- Europe & Central Asia|
The emphasis on the big push and balanced growth continued until the 1970s when the success of export oriented countries in Asia such as Korea and Taiwan (China) demonstrated that it was possible to escape the need to have balanced internal growth. Annual export growth of 15 percent or more helped to effect a major transformation in many of the newly industrialized Asian nations. A critical question is whether five decades later this option is still open.