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August 2015

Would you lose weight if we paid you?

Arndt Reichert's picture

If you were given a small reward every time you worked out, would you be more inclined to stick to a permanent exercise regimen? How much would that incentive have to be? Would regular exercise be beneficial for your health and ultimately to the greater society?

Monetary incentives are being increasingly introduced by policymakers into all kinds of interventions across a wide range of sectors including health, education, and the environment. The rationale for this trend is that we often make choices without accounting for how these choices may affect other people (and sometimes even ourselves). Obesity is one such example. It imposes high healthcare costs on society. Economists argue that well-designed monetary incentives can drive people to alter their choices so that everyone can benefit. 

​In health, the bulk of existing literature concludes that financial incentive schemes promoting healthy behavior are quite effective in the short run. Think about all the times we’ve rushed to our favorite exercise class lest we be fined for a no-show or were rewarded for showing up for ten classes in a row. Now what happens when those incentives eventually disappear altogether?

The impact of low oil prices in Sub-Saharan Africa

Gerard Kambou's picture
Growth picked up in Sub-Saharan Africa in 2014, after moderating in 2013, but remained weaker than during the pre-crisis years. It softened around the turn of the year owing to headwinds from the plunge in the price of oil. Sub-Saharan Africa’s oil exporters, which account for nearly half of the region’s aggregate output, have been hit hard by the sharp decline in the price of oil. From June 2014 to January 2015, oil prices fell by nearly 50 percent, and have remained low despite the recent uptick.        

Can a picture from space help to measure poverty in a Guatemalan village?

Andrea Coppola's picture

Also available in: Español

John Grunsfeld, former NASA Chief Scientist and veteran of five Space Shuttle flights, had several chances to look down at Earth, and noticed how poverty can be recognized from far away. Unlike richer countries, typically lined in green, poorer countries with less access to water are a shocking brown color. During the night, wealthier countries light up the sky whereas nations with less widespread electricity look dim.
Dr. Grunsfeld’s observation might have important implications. Pictures from satellites could become a tool to help identifying where poverty is, by zooming in to the tiniest villages and allowing a constant monitoring that cannot be achieved with traditional surveys.

The shadow over commodity exporting low-income countries (LICs)

Tehmina S. Khan's picture

Low-income countries facing a hangover as the commodity cycle turns

Until recently, confidence and expectations for low income countries (LICs) were soaring – with good reason. After all, for most of the 2000s, many LICs managed to consistently post growth rates that were much higher than in the previous three decades (Figure 1).

For metal and mineral exporting LICs – these account for almost two-thirds of LICs[1] – robust global demand for copper, iron ore, oil and high commodity prices filled government coffers and lifted investment and exports. This resulted in a broad based improvement in growth (Figure 2).  The 2000s also marked a decade of discoveries, with major oil and gas discoveries in East and West Africa that transformed long term prospects for some LICs.

Despite low commodity prices, growth prospects in low-income countries remain robust

Gerard Kambou's picture
Large agricultural sectors, remittances, and public investment have cushioned the impact of sharply weaker terms of trade in commodity-exporting low-income countries (LICs). Growth in LICs was flat in 2014, but is expected to pick up in 2015 and remain robust during 2016–17.  Declining commodity prices, however, are likely to increasingly put pressure on fiscal and current account balances of LICs that rely heavily on exports of energy and metals. Many commodity-exporting LICs have limited buffers to absorb this deterioration.

What drives local food prices? Is it world prices? Weather? Seasonality? Policies? Fuel prices? Other costs?

John Baffes's picture
The question has been asked often in the context of the post-2005 commodity price boom. In a recently published working paper, What drives local food prices? Evidence from the Tanzanian maize market, we examine the factors driving movements of prices in 18 major regional maize markets in Tanzania.

What do we know (and what not) about safety nets in urban areas?

Ugo Gentilini's picture
Cities are magnets of opportunity: they offer better standards of living than rural areas, and will soon house 75% of the global economy. But when demand for housing, jobs, and services outstrips capacity, urban areas can turn into congested, haphazard locales that amplify extreme poverty.