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March 2007

Fridays Academy: Education, Poverty Reduction and Economic Growth (IV)

Submitted by Ignacio Hernandez on Fri, 03/30/2007 - 10:04

As usual on Fridays, from Raj Nallari and Breda Griffith's lecture notes on Economic Policies for Poverty Reduction.

 

Global Initiatives for Education For All (EFA)

As mentioned in previous weeks, a number of global initiatives are on the table to achieve “education for all”.  Today we will examine how close the EFA goal is to being achieved. This posting is based on research conducted by Bruns, Mingat and Rakotomalala (2003).

 

The MDG for education that was also agreed at the Dakar World Education Forum aims at:

  • Ensuring that, by 2015, children everywhere, boys and girls alike, will be able to complete a full course of primary schooling
  • Eliminating gender disparity in primary and secondary education, preferably by 2005, and at all levels of education no later than 2015.

Completing a full-course of primary schooling would suggest a Universal Primary Completion (UPC) of 100. Based on the progress achieved over the 1990s, and projecting forward, Bruns et al., (2003) find that the global primary completion rate in 2015 would not exceed 83 percent. However, this rate masks enormous regional differences as illustrated in the exhibits below. 

 

Primary Completion Progress in Africa, Middle East and North Africa and South Asia Regions, 1990-2015, Country-Weighted

Analysing and Achieving Pro-Poor Growth

Submitted by Ignacio Hernandez on Thu, 03/29/2007 - 08:13

The latest issue of UNDP International Poverty Centre's journal, Poverty in Focus, is fully devoted to the analysis of pro-poor growth and its policy implications and results. The authors spell out and apply different definitions and measures in discussing various policy-related aspects of pro-poor growth.

Featured articles:

  • Global Estimates of Pro-Poor Growth, by Hyun H. Son
  • Pro-Poor Growth and Gender Inequality: Insights from new research, by Stephan Klasen
  • Analysing the Distributional Pattern of Growth, by Andy McKay
  • Promoting Pro-Poor Growth: Lessons from country experiences, by Louise Cord
  • Integrated Economic Analysis for Pro-Poor Growth, by Susanna Lundström and Per Ronnas
  • Employment and Pro-Poor Growth, by Azizur Rahman Khan
  • Formalising Informal Firms: What can be done?, by Esther K. Ishengoma and Robert Kappel
  • The Policy Origins of Poverty and Growth in India, by Timothy Besley, Robert Burgess and Berta Esteve-Volart
  • Growth and Poverty in Asia: Prospects for achieving the MDGs, by John Farrington and Mark Robinson
  • Poverty, Inequality and Labour Markets in Sub-Saharan Africa, by Germano Mwabu and Erik Thorbecke
  • Pro-Poor Stagnation: The Brazilian paradox, by  Nanak Kakwani, Marcelo Neri and Hyun H. Son
  • Ten Commandments of Pro-Poor Growth, by Mwangi S. Kimenyi

Fridays Academy: Education, Poverty Reduction and Economic Growth III

Submitted by Ignacio Hernandez on Fri, 03/23/2007 - 09:51

Like every Friday, from Raj Nallari and Breda Griffith's lecture notes on Economic Policies for Poverty Reduction.

 

Average Educational Attainment of Adult Population by Region, 2000

barro
Source:   Bruns, Mingat and Rakotomalala, 2003
 

 

In terms of inequality and educational attainment, the research is even more strongly established, with illiteracy one of the strongest predictors of poverty and unequal access to educational opportunity one of the strongest correlates of income inequality (Bruns, Mingat and Rakotomalala, 2003).  O’Connell and Birdsall (2001) and Birdsall and Londoño (1998) suggest that primary education is the “people’s asset” and that inequality in education has a strong and negative effect on growth, independent of the level of education and other factors such as trade openness and natural resource endowments.

 

Primary School Enrollment and Completion Rates; Selected Countries

Enrollment

Source:   Bruns, Mingat and Rakotomalala, 2003.

 

Today is World Water Day

Submitted by Ignacio Hernandez on Thu, 03/22/2007 - 07:20

Today is World Water Day. The theme this year is "Coping with Water Scarcity".

 

A good day to repost what writer Mario Vargas Llosa wrote recently about UNDP's Human Development Report 2006.

(my translation)

 

From this reading, the first conclusion I reach is that the emblematic object of civilization and progress is not the book, the telephone, Internet or the atomic bomb, but the toilet. Where human beings empty their bladder and intestines is the decisive factor to know if they still find themselves in the cruel underdevelopment or if they have started to make progress. The repercussions that this simple and very important fact has on people’s life are vertiginous…

…

In Dharavi, a populous part of Mumbai, there is only one toilet per 1,440 people, and in the rainy season the water flooding the streets turns them into rivers of excrements. The abundance of the liquid element is, in this case as in many third world cities, a tragedy, because, given the condition in which people live, water, instead of being life is often times the instrument of sickness and death…

…

In Les Miserables, Victor Hugo wrote that “sewers are the conscience of the city” and … he tried to do a strange interpretation of history through human excrement. This terrific report does something similar, without the poetry and eloquence of the great French romantic, but with a much better scientific knowledge.

…

Democracy and Economic Growth

Submitted by Ignacio Hernandez on Wed, 03/21/2007 - 17:48

Is Democracy the best setting for strong economic growth?

 

That is what the Wall Street Journal asked economists Daron Acemoglu and Ed Glaeser. You can read their debate on this very controversial issue in the WSJ online.

 

CIPE posted a quick summary of their discussion:

 

Glaeser: Data does not back up the idea that democracy is a key ingredient in economic growth

Acemoglu: There are different kinds of democracies, what you define as democracy matters.  Further, the relationship between democracies and economic growth differs, depending which view you take (short-term vs. long-term)

Glaeser: Democracies are not necessarily more stable than dictatorships.  More stable, successful democracies invest in human capital - and there is data to back this up.

Acemoglu: Education is important, but if you look around the world today it is evident that education is not necessarily more likely to consolidate democracy.

Glaeser: The link between education and democracy works, because: 1) educated people often lead political uprisings 2) educated people can craft better constitutions 3) educated people stand up and fight for democracy

Acemoglu: Educated countries may be more democratic and prosperous, but it does not mean that they are democratic and prosperous because they are more educated - the fact that they become more educated does not necessarily mean they are more likely to become more democratic.

 

John Edwards and the fight against poverty

Submitted by Ignacio Hernandez on Tue, 03/20/2007 - 17:42

Sarah Jane Hise writes in the CGD Blog about presidential candidate John Edwards and his Global Poverty Proposal launched last week: "Restoring America's Moral Leadership by Fighting Worldwide Poverty"

 

Three cheers for John Edwards for being the first presidential candidate of the 2008 campaigns to put forth his proposal on global poverty.

 

Owen also blogs about it: 

 

It would be good news for development if this becomes an issue in the US Presidential elections.

 

We agree with both.

Fridays Academy: Education, Poverty Reduction and Economic Growth II

Submitted by Ignacio Hernandez on Fri, 03/16/2007 - 10:20

Like every Friday, from Raj Nallari and Breda Griffith's lecture notes on Economic Policies for Poverty Reduction.

 

Education, Growth and Poverty Reduction

One of the major contributions to the new economic growth literature has been the recognition that human capital is critical in explaining growth differences across countries, with human capital in turn relying on a strong education system. Education directly benefits the individual and has positive spin-off effects for society in terms of increased productivity, higher rates of innovation and invention, and adaptation of new technologies.  However, the focus on ‘school attainment’ has generated criticism in recent years. Researchers note that while school attainment may be correlated with economic growth, this does not suggest a causal relationship.  Moreover, the relationship is sensitive to alternative estimates of school attainment and the underlying assumptions. 

 

Online Atlas of the Millennium Development Goals

Submitted by Ignacio Hernandez on Thu, 03/15/2007 - 08:11

Our colleagues from the Development Data Group at the World Bank have launched this online MDG Atlas.

 

Each map is supported by data tables, informative text, and charts in three languages: English, French, and Spanish.

 

Very useful, informative and easy to use. The option to have a map resized according to relative size of countries in relation to the various MDGs provides a very interesting and instant perspective.

 

Related: MDG website

The Gross Inequalities of Global Imbalances

Submitted by Ignacio Hernandez on Tue, 03/13/2007 - 13:15

Terry McKinley and Alex Izurieta write about global economic imbalances in UNDP International Poverty Centre's February one pager.

 

According to this paper, the US is running a deficit about 3.5 times larger than the deficits of all other OECD countries combined. The average US current account deficit in recent years has been one third higher than the total GDP of sub-Saharan Africa.

 

global imbalances
Source: UNDP - International Poverty Centre

 

 

Current global imbalances not only pose huge dangers; they also cause a grossly inequitable distribution of global resources. Capital is ‘flowing uphill’ to rich countries—overwhelmingly to one rich country, the US.

…

The money that many middle-income countries are now investing in the US could make a major contribution to development if it were redirected to poorer countries, or even kept within these middle-income countries. Because more goods and services would become available domestically, the population in such countries would enjoy a higher standard of living.

…

Since the US is enjoying the fruits of this inequitable imbalance in resource flows, it has limited motivation to correct it. An impending US economic collapse is probably the main factor that could impel national policymakers into action. An alternative solution, mutually beneficial to all, could be a coordinated effort by both developed and developing countries to stimulate domestic demand in regions other than the US.

 

 

Fridays Academy: Education, Poverty Reduction and Economic Growth

Submitted by Ignacio Hernandez on Fri, 03/09/2007 - 10:42

Like every Friday, from Raj Nallari and Breda Griffith's lecture notes on Economic Policies for Poverty Reduction.

 

Educational attainment has a positive impact on economic growth and poverty reduction. The microeconomic literature has also established a clear relationship between educational attainment and individual income. Educational attainment is positively linked with technological adaptation, innovation, and increased productivity, generating positive spin-off and growth effects for the economy. Non-economic factors also posit a positive role for education: it is a basic human development capability.  Yet for many of the world’s poor, access to education remains out of reach. Improvements have taken place in school attainment but many challenges remain.

 

Achieving universal primary education (UPE) by 2015 is a Millennium Development Goal.  The failure to achieve UPE and reduced illiteracy rates by 2000 that was agreed by the global community at the World Conference on Education for all at Jomtien, Thailand, was again adopted by 180 nations at the World Education Forum at Dakar in 2000.  Education helps in the achievement of all of the other Millennium Development Goals such as poverty reduction, gender equity, child and maternal health, lower HIV/AIDS and other communicable diseases, and environmental stability. 

 

International Women's Day

Submitted by Ignacio Hernandez on Thu, 03/08/2007 - 12:45

Today is International Women's Day.

 

A good day to remember that Gender Equality is not only desirable and fair per se, it is also Smart Economics, promoting growth and poverty reduction. (Full World Bank's Gender Action Plan)

 

Nicola Jones from ODI blog writes an interesting article about how to overcome Gender Fatigue.

But a smarter response would be to take occasions like International Women’s Day (March 8) to encourage school and university teachers to teach students about the history of the first and second wave women’s movements (in the North and South) and what these activists achieved, often at considerable personal and social cost. Too often there is a rather simplistic assumption that greater gender equality will simply follow economic development rather than being a dynamic process in which deliberate collective action efforts to reshape gender relations often play a critical role.

Internet course: Economic Policies for Poverty Reduction in Developing Countries

Submitted by Ignacio Hernandez on Tue, 03/06/2007 - 19:21

We are organizing the second part of our Economic Literacy for Civil Society Internet course: "Economic Policies for Poverty Reduction in Developing Countries" (18 March to 13 April). The course is based on the teaching materials used in our Fridays Academy series.

 

The aim of this Internet course is to contribute to a deeper understanding of the areas that impact the lives of the poor. After describing the experience over the past several decades with development aid, which aims to place poor countries on a sustainable long-run sustainable growth path, the course turns to a discussion of external debt and how it became unsustainable in many low-income countries, crippling their growth potential and keeping millions in poverty. The remainder of the course examines four areas that can hinder the movement of the poor out of poverty. These areas—education, health, labor markets and land —are core components of public policy that need to be addressed if poverty is to be tackled effectively.

 

Full description

Apply online

Please note that deadline to apply is March 13th.

Fridays Academy: The Initiative for the Heavily Indebted Poor Countries (HIPCs)

Submitted by Ignacio Hernandez on Fri, 03/02/2007 - 11:10

Like every Friday, from Raj Nallari and Breda Griffith's lecture notes.

 

In September 1996, the World Bank and the IMF together launched the Initiative for the Heavily Indebted Poor Countries (HIPCs) with the ‘aim of reducing the external debt burden of all eligible HIPCs to a sustainable level in a reasonably short period of time’ and provided that the countries carried out a ‘strong programs of macroeconomic adjustment and structural reforms’ (Andrews et al., 1999).  A country was judged to have reached a sustainable level of external debt if it could meet its current and future external debt-service obligations in full without accessing debt relief, rescheduling of debt, accumulation of arrears and without compromising growth.  At the outset, 41 countries were identified as being heavily indebted poor countries; 32 of these had a GNP per capita in 1993 of $695 or less, a NPV of debt to exports of 220 percent or higher or a NPV of debt to GNP of 80 percent or higher.  The remaining nine countries were those that had received or were eligible for concessional rescheduling from the Paris Club official creditors.  Furthermore, these countries were eligible for IDA loans and for the ESAF and were required to show strong track records of performance under IMF and World Bank sponsored programs (Andrews et al., 1999).