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This blog is maintained by the Growth and Crisis (GC ) Program of the World Bank Institute.

We bring you timely news, resources, tools, ideas and commentaries on issues related to the global economic crisis and growth.

May 2009

Fridays Academy: Corruption, Growth and Poverty

Submitted by Ignacio on Fri, 05/22/2009 - 08:16

(From Raj Nallari and Indira Iyer's lecture notes)

The literature on corruption is large and growing. In this and upcoming Fridays Academy comments we will attempt to capture the essence of the arguments and provide some empirical evidence on the impact of corruption on growth and poverty reduction. Corruption, which includes bribery, rent-seeking, extortion, embezzlement, is perceived as a major problem facing many countries.  Corruption has therefore been variously defined to mean ‘the misuse of public office for private gain.’   This does not mean that there is no corruption in the private sector because this is quite common in (private) financial firms.  But, corruption is more severe in the public sector than in the private sector.  One of the first known articles on corruption and its punishment is in Kautilya’s Arthasastra (dating back to 14 BC).  Corruption is found to be closely inter-related with a country’s social norms, formal and informal rules and culture as well as legal environment in a country.  No matter what, corruption connotes illegal or improper (moral) behavior and is treated as a ‘socially and culturally deviant behavior.’  From political science point of view, high level of corruption coincides with political instability and tends to reduce citizen’s trust and faith in institutions.

Measurement of Corruption

Fridays Academy: Urbanization and Growth

Submitted by Ignacio on Fri, 05/08/2009 - 10:46

Conclusion

Urbanization is increasing at a rapid pace. Between 2005 and 2030, the world’s urban population is expected to grow at an average annual rate of 1.78 per cent, almost twice the growth rate of the world’s total population. The proportion of people living in rural areas will shrink significantly after 2015. While increasing urbanization has led to greater per capita incomes and productivity, at the same time, it has led to increasing informal sector, greater urban poverty, increasing number of slums, scarcity of housing, spiraling urban real estate prices, and inadequate infrastructure facilities. Given this phenomenon of economic concentration in one area and spatial disparities elsewhere, the key issue is “should rural labor move to jobs or should jobs move to rural areas?”  Finance and labor do not automatically move towards poorer areas. Available evidence from across the world suggests that policy makers should strive to remove impediments to capital and labor flows and reinforce agglomeration economies.  This can be done by policy makers encouraging labor movement by abolishing national minimum wages, cutting unemployment benefits and social benefits, and abolishing rent control to increase supply of housing.  Similarly, improving business climate, increasing access to finance, including microfinance and availability of credit to small enterprises, and developing infrastructure services before firms move in, are likely to affect the decisions of firms in location of their productive activities.  Strengthening the capacity of provincial and local governments in provision of essential services would be key to reduce economic concentration and spatial disparities.

World Development Indicators 2009

Submitted by Ignacio on Thu, 05/07/2009 - 14:24

The World Development Indicators is the World Bank's premier annual compilation of data about development. The 2009 WDI includes more than 800 indicators in over 90 tables organized in 6 sections: World View, People, Environment, Economy, States and Markets, and Global Links.

WDI online database available for subscribers. Selected indicators can also be accessed for free with the quick query.

Moving Out of Poverty: Success from the Bottom Up (video presentation)

Submitted by Ignacio on Tue, 05/05/2009 - 13:58

A while ago we mentioned the publication of the World Bank’s newest study on poverty: “Moving Out of Poverty: Success from the Bottom Up”.

A video of a recent presentation of this publication at the World Bank is now available on-line. Participants included, among others, Deepa Narayan, Project Director of the study, and Geoffrey Lamb, Managing Director of Public Policy at the Bill and Melinda Gates Foundation.

Fridays Academy: Urbanization and Growth

Submitted by Ignacio on Fri, 05/01/2009 - 09:57

Urban Land Management and Housing

It is not easy to control migration into a city. Therefore, cities become overcrowded with growing competition for space, mobility and resources. In the past 30 years the urban population in the Asian and Pacific region has increased by 560 million people (or 260 per cent) and in the next 30 years it is expected to increase by about 1,450 million people (or 250 per cent).