As I reported in my last post, Jim Kim’s arrival as World Bank President has reinvigorated the debate about the idea of the World Bank being a ‘knowledge bank’. In the post, I argued that the knowledge produced by the Bank – whether gleaned from its lending operations, or from its research and other analytic work – is a global public good, and that we should therefore assess the success of the institution in its knowledge work not in terms of how specific ‘client’ governments value the outputs of its knowledge work but rather in terms of how people around the world use and value them.
“People want to work, not fight,” said Nadir Ali, a male shopkeeper in Kabul, Afghanistan, in one of the discussion groups of the Moving out of Poverty: Rising from the Ashes of Conflict report. For many, like Nadir, work is a crucial part of their existence. However, in many parts of the world conflicts and violence prevent citizens from working as they destroy communities, institutions, infrastructure and human capital. Not surprisingly, they represent a major challenge to job creation, as highlighted by the 2011 World Development Report (WDR) and the forthcoming 2013 WDR.
South Asia has experienced high levels of conflict over the past decade. More than 58,000 people were killed in armed conflict worldwide in 2009; at least a third of them were in South Asia.1 Ongoing conflicts in the region include the conflicts in Afghanistan and Pakistan, insurgent movements in India’s northeastern regions, and the violent activities of left-leaning groups in the eastern and central parts of India. Nepal and Sri Lanka are recovering from long-lasting civil wars. In a recent paper prepared for South Asia’s first regional flagship report "More and Better Jobs," we examine the key challenges to job creation in conflict-affected environments, using household and firm level surveys from South Asian countries.
While education is one of the cornerstones of development and is enshrined in the Millennium Development Goals, the pay-offs from a Bachelor’s degree or higher do not enjoy the same confidence. In the wake of the global financial crisis, for some, a college degree is a “lousy investment.” (Read the Daily Beast article to know why). But new data prove otherwise. Adam Looney and Michael Greenstone at the Hamilton Project, through chart illustration, show that “the more income you earn, the more likely you are to have gone to college.” To find out more, read the post “College, still worth it” on the Economix blog here. While we are still discussing education, here’s another interesting finding from the OECD “Education at a Glance 2012” report. According to the report, a college education not only makes you wise and wealthy, it also makes you healthy. Curious? Read this Economist article to know how.
Unsurprisingly, with the recent arrival of a new president fresh from the groves of academia, the halls and meeting rooms of the World Bank are buzzing once again with talk of the “Knowledge Bank” or KB for short. But what exactly is a “knowledge bank”?
To my mind the paper that pins the idea down best is “Positioning the World Bank” by Chris Gilbert, Andrew Powell and David Vines in the Economic Journal in 1999.
Knowledge as a public good
Gilbert & Co argue that knowledge about best-practice development is a global public good – the entire world stands to benefit from it, even though some may benefit from it more than others. Given the public good character of global knowledge on development, too little of it would appear if production were left to the free market.
In case you hadn’t noticed, there’s a growing clamor for a global commitment to universal health coverage (UHC). You might have seen the recent special issue of the Lancet on “the struggle for UHC”. Inevitably, accompanying this clamor, there’s been a lot of wracking of brains on how to measure progress toward UHC. With the excitement of a new political agenda, there’s understandably a desire to carve out a new measurement agenda too. While not wanting dampen people’s enthusiasm for the UHC cause, I would like us to reflect whether on the measurement agenda we’re building enough on what’s been done before.
Is the world ready for the advice that governments can better balance the need for credit and emergency support for banks with measures to promote transparency and competition when crises erupt? Governments want every viable tool possible in their arsenal to fight crises, but a bit of 'less is more' and a cautionary re-examination of the role of the state in finance may be in order. This is the thrust of the new Global Financial Development Report (GFDR) 2013: Rethinking the Role of the State in Finance, released Thursday September 13, just ahead of the fourth anniversary of the collapse of Lehman Brothers, which marked the full onset of the financial crisis. The GFDR analyzes four characteristics of banks in over 200 economies since the 1960s and comes with a useful treasure trove of online data.
Check out the GFDR website here.
Starting in the early 1990s many emerging economies have embraced financial sector reforms and liberalization. As a consequence, they have become more financial globalized, triggering an important debate about the pros and cons of this process and its relation to financial crises. Notwithstanding all the attention, there are different dimensions of globalization, which are many times not clearly defined and which might add noise to the discussion.
In a recent World Bank policy research working paper and VoxEU column, we argue that there are at least two interconnected, albeit essentially distinct facets of financial globalization. The first one is financial diversification, that is, the cross-country holdings of foreign assets and liabilities. The second one is financial offshoring, that is, the use of foreign jurisdictions to conduct financial transactions. While the former focuses on who holds the assets, the latter deals with where the assets are transacted.
DEC staff and the World Bank as a whole are excited at the news that Kaushik Basu will be the new Chief Economist.
Basu was until recently the Chief Economic Adviser to the Government of India, at the Ministry of Finance, and is currently Professor of Economics and the C. Marks Professor of International Studies at Cornell University.
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.