Building on Johanna's earlier post on social media, I thought I'd highlight a few points from Clay Shirky's new piece in Foreign Affairs, entitled "The Political Power of Social Media" (users must register). The essay is a thought-provoking contribution to the ongoing discussion about technology's political impact - and it also gives me an opportunity to clarify a few issues regarding my thinking on the Internet and authoritarian regimes.
As surprising as it may seem, there is a deep dark secret at the core of the System of National Accounts (SNA) – the accounts used by Finance ministries worldwide to measure economic performance. The numbers don’t add up. We can see this in the table below, showing the net worth of Brazil and its composition in 2005. The final two lines in the table report a measure of Brazil’s net national income and the implicit rate of return on wealth (the ratio of income to net worth). The return to Brazil’s produced and natural capital is over 18%! As good economists, we should all be investing our pension funds in Brazil. Why? Because financial market data tell us that the long run real rate of return across the broad range of assets averages only about 5% a year.
|Table – Net worth and net national
Income (NNI) in Brazil, 2005, $million
|Net financial assets||-117,221|
|Implicit rate of return||18.2%|
|Source: The Changing Wealth of Nations
World Bank (2011)
Editor's Note: The following post was submitted jointly by Mohammad Amin and Arvind Jain, both of the World Bank Group's Enterprise Analysis Unit.
The AkiraChix, an-all girls’ team, was declared a winner of the recently held IPO48 software development competition in Kenya. The IPO48 initiative brought together 100 participants from all over the country to pitch their ideas, question business models, form teams and create 17 prototypes and products which, by the end of 48 hours, were ready for the market (Afrinnovator). The winning girls came up with an innovative M-Farm, a mobile-based marketplace that is targeted to small-scale farmers to increase their agriculture productivity.
The entity often known as ‘the international community’ has a touching faith in standard liberal constitutions and one-person-one-vote elections. Now, while those are outstanding human inventions, it is becoming clearer every day that in plural, deeply divided societies these inventions alone will not lead to settled systems of governance.
|Kathmandu, Nepal. Photo: © Simone D. McCourtie / World Bank|
You might recall that the finance minister of Nepal announced in the annual budget in July 2009 that the government would issue a diaspora bond to raise funds for infrastructure development. Indeed Nepal Rastra Bank followed through in June 2010 by floating a “Foreign Employment Bond”. Although the initial goal was to issue Rs. 7 billion (about $100 million), Rs. 1 billion was floated in the first round. Nepali workers in Qatar, Saudi Arabia, UAE, and Malaysia could buy the bond from one of seven licensed money transfer operators in denominations of Rs. 5,000 (about $65).
Data are hard to come by, but the funds raised have been minuscule, nowhere near target. Apparently, the name of the bond had nothing to do with its unsuccessful launch!
Editor's Note: Raju Jan Singh recently presented the findings of the paper discussed in the following blog post at a session of the FPD Academy. Please see the FPD Academy page on the All About Finance blog for more information on this monthly World Bank event.
The recent financial crisis has renewed concerns about the merits of financial development, especially for the most vulnerable parts of the population. While financial development and its effects on economic growth have attracted much attention in the literature, far less work has been done on the relationship between financial deepening and poverty. Yet some economists have argued that lack of access to finance is among the main causes of persistent poverty.
Studies on the relationship between financial development and income distribution have been inconclusive. Some claim that by allowing more entrepreneurs to obtain financing, financial development improves the allocation of capital, which has a particularly large impact on the poor. Others argue that it is primarily the rich and politically connected who benefit from improvements in the financial system.
If Einstein had to write his famous equation in the context of the changes in Bihar it would translate into:
EDUCATION = MATH * COMMUNICATION * CURIOSITY (and probably have a 3rd C as another element for ‘Confidence’!!)
Gyanshala’s innovative pedagogy and Chaitanya Gurukul’s integration of technology and web content into education are building a strong case for innovation in getting effective education to the most remote and poor corners of India – by focusing on whats essential.
From the Latin American Debt crises to East Asia’s financial sector turmoil, past macroeconomic shocks have traditionally affected women differently than men. Such asymmetries are even more evident in the context of today’s financial crisis, where gender-differentiated impacts are expected to affect women more acutely than ever.
As women’s participation in the globalized workforce has steadily increased, the present shock is expected to have greater effects on women’s
The world economy is moving from a post-crisis bounce-back phase of the recovery to slower but still solid growth this year and next, with developing countries contributing almost half of global growth. This is according to the World Bank’s latest Global Economic Prospects 2011, a twice-yearly report examines growth trends for the global economy and how they affect developing countries.