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developing countries

Why Civil Registration matters in the countdown to the Millennium Development Goals

Sulekha Patel's picture

With just four years to the target date of 2015, progress on the health-related Millennium Development Goals (MDGs) has been slow. Measuring progress has been hampered by the lack of quality and timely data; this is especially true when measuring progress toward goals that rely on civil registration for their information, such as Goal 4 on reducing child mortality. Available data in the new edition of World Development Indicators show that of the 144 countries for which data are available, more than 100 countries remain off-track to reach the MDG 4 by 2015.  

What Does Adam Smith’s Linen Shirt Have to do with Global Poverty?

Martin Ravallion's picture

In his Inquiry into the Nature And Causes of the Wealth of Nations Adam Smith pointed to the social-inclusion role of a linen shirt in 18th century Europe:

“A linen shirt … is, strictly speaking, not a necessary of life. Adam Smith. Photo: Istockphoto.comThe Greeks and Romans lived, I suppose, very comfortably though they had no linen. But in the present times, through the greater part of Europe, a creditable day-labourer would be ashamed to appear in public without a linen shirt, the want of which would be supposed to denote that disgraceful degree of poverty which, it is presumed, nobody can well fall into without extreme bad conduct.”

This passage has often been used to justify the view that poverty is not absolute but relative—that certain socially-specific expenditures are essential for social inclusion, on top of basic needs for nutrition and physical survival.

The way this idea is implemented in practice is to set a “relative poverty line” that is a constant proportion of average income for the country and date in question. That is how poverty is measured in most of Western Europe. By contrast, poverty measures in developing countries have almost invariably used absolute lines, which aim to have a fixed real value over time. The World Bank’s international “$1 a day” poverty lines also aim to be absolute lines across countries, using purchasing power parities from the International Comparison Program.

A High Cost to Bangladesh if it Remains Unprepared for Climate Change

Susmita Dasgupta's picture

Global warming may have severe consequences for developing countries prone to extreme weather events. Projections by the Intergovernmental Panel on Climate Change and the World Meteorological Organization suggest the frequencies and/or intensities of climate extremes will increase in the 21st century. Some recent extreme weather events illustrate how severe their consequences can be. Examples include heavy floods in Australia and Brazil in 2011, extreme winter weather all over Europe, heat wave in Russia, devastating floods in Pakistan, India, China, and Mozambique in 2010, and super cyclones in Myanmar (in 2008) and Bangladesh (in 2007).

The Poor Half Billion--what is holding back lagging regions in South Asia?

Ejaz Ghani's picture

South Asia presents a depressing paradox. It is among the fastest growing regions in the world. But it is also home to the largest concentration of people living in poverty. While South Asia is at a far more advanced stage of development than Sub-Saharan Africa, it has many more poor people than Sub-Saharan Africa.

Figure 1: Number of Poor People has increased in South Asia

Source: World Development Indicators, World Bank 2009.          
Note: Number of people living on less than US$1.25 a day at 2005 international prices. South Asia includes Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, and Sri Lanka. East Asia Pacific includes China.

Choosing countries as models for industrial growth

Justin Yifu Lin's picture

Train station. India. Photo: © Curt Carnemark / World Bank

Shanta’s thoughtful comments on our Growth Identification and facilitation (GIF) paper are most welcome. The issues of industrialization and structural transformation are at the heart of economic development. Following comments already made by my co-author Célestin Monga on this blog, let me offer a few thoughts to this exchange.

First, the GIF approach explains the economic success of a very diverse group of countries: China (with 1.3 billion population), Japan (100 million); Taiwan-China (20 million); Korea (40 million); Singapore (5 million); or Mauritius (400.000). The framework has also been applied in large Western countries such as Germany, France, and United States, and small European countries like Sweden, Norway, Finland, and Ireland. The political systems of those economies are also very different, some are democratic and some are authoritarian.

Growth identification and facilitation – let the debate begin

Célestin Monga's picture
 photo: istockphoto.com

In the famous movie Forrest Gump (1994), which is the story of an innocent man who represents how the world should be, the main character Tom Hanks remembers: “My Mama always said, ‘Life is like a box of chocolates; you never know what you’re gonna get.’” Development economists working on industrial policy should always keep in mind that motherly wisdom and maintain humility in their random quest for the recipe for economic growth.

In a recent paper on ‘Growth Identification and facilitation: The role of the state in the dynamics of structural change,’ Justin Yifu Lin and I have tried to suggest a rational way of looking at the trial-and-error process that successful economic development always involves. In a new post on his excellent blog ‘Africa Can,’ my colleague Shanta Devarajan welcomes our work but asserts that we gloss over the politics that underlie efforts by governments to guide certain industries toward success.

Of Dark Matter and Domesday

Kirk Hamilton's picture

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
Produced capital  1,909,259
Natural capital 1,713,939
Net financial assets -117,221
   
Net worth 3,505,978
   
Adjusted NNI 636,356
Implicit rate of return 18.2%
Source: The Changing Wealth of Nations
World Bank (2011)

 

The global economy ushers in new phase of recovery, but vigilance is required

Justin Yifu Lin's picture
Photo: © World Bank

Two years after the crisis triggered by the collapse of Lehman Brothers, the world economy has entered a new phase of recovery. Most developing countries have recovered to pre-crisis (or close to pre-crisis) levels of activity and have transitioned from a bounce-back phase to more mature growth.

We estimate in our new online Global Economic Prospects 2011 report that the growth rate for the world economy was 3.9% in 2010 and is likely to be to 3.3% this year, then 3.6 % in 2012.

The GDP growth rate for developing countries was a robust 7 percent in 2010, up sharply from 2% growth in 2009. This year we project the developing world will record GDP growth of 6%, then edge to an estimated 6.1% in 2012. This far outstrips the high income countries, which grew by 2.8% in 2010 and are estimated to growth by 2.4% this year and 2.7% next year.

Talking development in two hundred years of books

Martin Ravallion's picture

  Photo: istockphoto.com
How long have we been talking about “economic development”? And what about concepts like “economic growth,” “poverty” and “inequality”? How old are they in the literature, and how has the frequency of their use changed over time?

We can now answer such questions thanks to a new software tool, the Google Books Ngram Viewer, introduced in a research paper by Jean-Baptiste Michel and others (13 authors are listed, plus the Google Books Team); the paper has just been published in the journal Science, and was picked up in the New York Times. The authors have formed a corpus of over 500 billion words (360 billion in English) from over 5 million books spanning 1800-2000.

International capital flows: Final picture from 2009

Shahrokh Fardoust's picture
 Photo: Istockphoto.com

As snow covers ground in Washington, D.C., debt markets swoon, and another year comes to a close, it seems like a good time to look at what actually happened to international capital flows to developing countries last year and what that might portend for flows in 2010, as this year’s numbers will be finalized in coming months.

At a time when the global economy has seen the most severe slowdown since the end of WWII, capital flows to the developing world—including private flows (debt and equity) and official capital flows (loans and grants from all sources)—are in an overall slump, well below their level in 2007 ($1.1 trillion). According to the just-published Global Development Finance: External Debt of Developing Countries, which contains detailed data on the external debt of 128 developing countries for 2009, net capital flows to these countries fell by 20 percent from $744 billion in 2008 to $598 billion in 2009. 

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