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January 2013

Development Optimism from Justin Lin: Review of 'The Quest for Prosperity'

Duncan Green's picture

‘Every developing country has the opportunity to grow at over 8% a year for 20-40 years, and to get rid of poverty within a generation.’ There’s something very refreshing about listening to East Asian development economists, in this case the prolific Justin Lin, a former World Bank chief economist, launching his new book The Quest for Prosperity, at ODI just before Christmas. The contrast between his can-do optimism and the dark clouds of Eurogloom and Afropessimism could not have been greater. But is he right?

While others in development wonkland are increasingly scathing about blueprints and best practice guidelines, Justin is unabashedly a man with a plan. The book takes his paper on ‘Growth identification and facilitation’, (see my earlier review, and Justin’s reply), and boils his thinking down into what he calls a ‘six point recipe’ for developing country governments.

The Costs of Inaction

Shanta Devarajan's picture

Sudhir Anand and co-authors recently published a fascinating book, The Costs of Inaction, which looks at cost-benefit analysis in a different way. All cost-benefit analysis requires the analyst to specify a counterfactual—how the world would have evolved in the absence of the project of program.  This is critical.  An evaluation in Kenya included increased use of cellphones as an indicator of project success — neglecting the fact that cellphone use in neighboring villages was just as widespread. 

In many cases, the counterfactual could be “doing nothing.”  For a number of important areas such as health and education in Africa, The Costs of Inaction calculates the costs of doing nothing in terms of lives lost or under-educated children. 

Quote of the Week: Norman Davies

Sina Odugbemi's picture

"Historical change is like an avalanche. The starting point is a snow-covered mountainside that looks solid.  All the changes take place under the surface and are rather invisible.”

- Norman Davies. An English Historian and the author of several books on Polish and European history.

As quoted in the Financial Times, October 19, 2012. Lunch with the FT: Norman Davies, by Tony Barber.

Tourism: a ‘win-win’ sector to promote recovery & employment in the Middle East & North Africa

Peter McConaghy's picture
        World Bank

From the pyramids showcasing the world’s first great civilization, to the sandy white beaches of the southern Mediterranean, religious sites and pristine eco-reserves, the Middle East and North Africa region is chock full of unique tourist attractions. Tourism in MENA does not only satisfy the hedonistic wishes of vacationers – it is an important sector for economic development and job creation.

Financial Innovation: The Bright and the Dark Sides

Thorsten Beck's picture

The Global Financial Crisis of 2007 to 2009 has spurred renewed widespread debates on the “bright” and “dark” sides of financial innovation.   The traditional innovation-growth view posits that financial innovations help reduce agency costs, facilitate risk sharing, complete the market, and ultimately improve allocative efficiency and economic growth.  The innovation-fragility view, by contrast, has identified financial innovations as the root cause of the recent Global Financial Crisis, by leading to an unprecedented credit expansion fueling a boom-bust cycle in housing prices, by engineering securities perceived to be safe but exposed to neglected risks, and by helping banks and investment banks design structured products to exploit investors’ misunderstandings of financial markets and exploit regulatory arbitrage possibilities. Paul Volcker, former chairman of the Federal Reserve, claims that he can find very little evidence that the financial innovations in recent years have done anything to boost the economy.

Revitalizing the Waterfront

Parul Agarwala's picture

A thriving and active waterfront has been a common thread for great cities and urban centers, though the relationship of cities with their waterfront has undergone a series of transformations. In the industrial era, manufacturing and maritime activities such as shipyards, warehouses, and heavy industries dominated properties along the water, which served as an important transportation corridor. Today, in the post-industrial era, many cities are realizing the potential of reinventing waterfront properties.

In a webinar on January 10 hosted by the World Bank’s South Asia Urbanization Flagship Project in collaboration with the East Asia and Pacific urban team, speakers and participants from around the globe discussed challenges, strategies, and successful practices in waterfront redevelopment through a series of case studies. Five essential ingredients emerged:

Bloomberg, Kim on Need for Greener, More Efficient Transport in Cities

Donna Barne's picture

Read this post in Español, Français

World Bank President Jim Yong Kim and New York Mayor Michael Bloomberg speak outside the Transforming Transportation 2013 conference.

World Bank President Jim Yong Kim and New York Mayor Michael Bloomberg weighed in January 18 on what it will take to shape the future of cities — and cut pollution, road deaths, commute times, and poverty.

A large part of the answer: greener, more efficient and cost-effective urban transportation that is designed to move people, not cars.

“We have to start looking at other ways to move people. Traffic does hurt your economy,” Mayor Bloomberg said at the 10th Annual Transforming Transportation conference in Washington, D.C., hosted by the World Bank and EMBARQ.

With 90 percent of city air pollution caused by vehicles, finding transportation solutions also will help confront emissions that drive climate change, Dr. Kim added.

Friday Roundup: Migration and Development, Global Economy and Innovation, and WDR App

LTD Editors's picture

About 3% of the world's people live outside the country of their birth. What does this mean for the migrants, and their countries – most of which are developing? The Guardian is inviting comments and questions on the topic of migration and its impact on development for its monthly podcast. To learn more, read “Talk point: what is the impact of migration on development?,” which also quotes the latest remittances figures from the World Bank.

According to the latest edition of Global Economic Prospects, (GEP), the global GDP  is estimated to grow by  2.4 percent in 2013, marked by weaker growth in  developed countries. With the global economy remaining fragile, a return to the “good times” seems farther now. The Economist argues that the economic stagnation of the rich countries is also hurting innovation, which has direct links to economic growth. Read the post from to know more. While on this topic, according to figures from the GEP, the value of exports from developing countries to other developing countries (“South-South” trade) now exceeds exports from poor countries to rich ones (“South-North” trade). Read the full article on The Economist here.


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