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1. A Short-Sighted Vision for Global Britain

Author:
Owen Barder, Hannah Timmis, and Arthur Baker
Publication Date:
03-2019
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
here has been a resurgence in calls to reconsider the cross-party consensus in the UK on foreign aid and development. The main political parties are all committed to spending 0.7 percent of gross national income on aid, to using the internationally agreed definition of aid, and to maintaining a separate government department to administer the majority of this aid, led by a Cabinet Minister. In their recent report, Global Britain: A Twenty-first Century Vision, Bob Seely MP and James Rogers lay challenge to these long-established pillars of UK development policy. In this note, we consider some of the questions they raise and suggest alternative answers.
Topic:
Development, Government, Foreign Aid, and Bureaucracy
Political Geography:
Britain and Europe

2. The Principles on Commercial Transparency in Public Contracts

Author:
The Working Group on Commercial Transparency in Public Contracts
Publication Date:
03-2019
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Transparency by design: Transparency should be the norm for all government contracts, particularly regarding information on what is being exchanged and for what price. Contracting systems should be designed to support proactive publication of contracts as open data. Public contracting should be designed for transparency and efficiency. Full contract publication should be the norm. Information needed to judge value for money should be disclosed. Exceptions in the public interest: Redactions on the basis of commercial sensitivity should only be justified where the public interest in withholding information is greater than the public interest in having that information published. The assessment should take into account both any commercial harm to the contractor and the broader benefits of transparency to markets and public trust. Where exceptions to publication are considered: Information should only be redacted for reasons of commercial sensitivity when the public interest in withholding information is greater than the public interest in disclosure. The public interest test should take into account the wider economic benefits of the sharing of commercial information, as well as the case for accountability and the public’s right to know. All redactions should be clearly marked with the reason for redaction. A clear and robust process: Governments should issue detailed guidance on commercial sensitivity principles and exemptions, put in place systems to support publication, ensure that redaction is time-limited, and use other oversight mechanisms to compensate for information withheld from publication. Governments should issue clear guidance to public entities, agencies, and firms on contract publication and when information may be exempted from publication for commercial sensitivity reasons. Where redaction is potentially allowed, there should be a clear process for determining what is redacted, why, for how long, and with what appeals process. There should be a system for ensuring that contracts and contract information are in fact disclosed in practice. Where exemption to disclosure of information is granted for commercial sensitivity reasons, this should be grounds for increased scrutiny through other oversight mechanisms.
Topic:
Government, Transparency, Public Service, and Contracts
Political Geography:
Global Focus

3. Guarantees, Subsidies, or Paying for Success? Choosing the Right Instruments to Catalyze Private Investment in Developing Countries

Author:
Owen Barder
Publication Date:
05-2015
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Governments, donors, and public sector agencies are seeking productive ways to 'crowd in' private sector involvement and capital to tackle international development challenges. The financial instruments that are used to create incentives for private sector involvement are typically those that lower an investment's risk (such as credit guarantees) or those that lower the costs of various inputs (such as concessional loans, which subsidise borrowing).
Topic:
Development and Government

4. The Cost and Cost-Effectiveness of Alternative Strategies to Expand Treatment to HIV-Positive South Africans: Scale Economies and Outreach Costs

Author:
Mead Over, Gesine Meyer-Rath, Daniel J. Klein, and Anna Bershteyn
Publication Date:
04-2015
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
The South African government is currently discussing various alternative approaches to the further expansion of antiretroviral treatment (ART) in public-sector facilities. Alternatives under consideration include the criteria under which a patient would be eligible for free care, the level of coverage with testing and care, how much of the care will be delivered in small facilities located closer to the patients, and how to assure linkage to care and subsequent adherence by ART patients. We used the EMOD-HIV model to generate 12 epidemiological scenarios. The EMOD-HIV model is a model of HIV transmission which projects South African HIV incidence and prevalence and ARV treatment by age group for alternative combinations of treatment eligibility criteria and testing. We treat as sunk costs the projected future cost of one of these 12 scenarios, the baseline scenario characterizing South Africa's 2013 policy to treat people with CD4 counts less than 350. We compute the cost and benefits of the other 11 scenarios relative to this baseline. Starting with our own bottom-up cost analyses in South Africa, we separate outpatient cost into non-scale-dependent costs (drugs and laboratory tests) and scale-dependent cost (staff, space, equipment and overheads) and model the cost of production according to the expected future number and size of clinics. On the demand side, we include the cost of creating and sustaining the projected incremental demand for testing and treatment. Previous research with EMOD-HIV has shown that more vigorous recruitment of patients with CD4 counts less than 350 appears to be an advantageous policy over a five-year horizon. Over 20 years, however, the model assumption that a person on treatment is 92 percent less infectious improves the cost-effectiveness of higher eligibility thresholds over more vigorous recruitment at the lower threshold of 350, averting HIV infections for between $1,700 and $2,800 (under our central assumptions), while more vigorous expansion under the current guidelines would cost more than $7,500 per incremental HIV infection averted. Granular spatial models of demand and cost facilitate the optimal targeting of new facility construction and outreach services. Based on analysis of the sensitivity of the results to 1,728 alternative parameter combinations at each of four discount rates, we conclude that better knowledge of the behavioral elasticities would be valuable, reducing the uncertainty of cost estimates by a factor of 4 to 10.
Topic:
Government
Political Geography:
Africa

5. Direct Distribution of Oil Revenues in Venezuela: A Viable Alternative?

Author:
Pedro L. Rodríguez, José R. Morales, and Francisco J. Monaldi
Publication Date:
09-2012
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Venezuela is a textbook example of a resource-dependent country—between 1950 and 2008, oil generated over a trillion dollars of income for the state. Nevertheless, Venezuela currently combines an economy that is stagnant, despite high oil prices, with an increasingly authoritarian government. The authors argue that large oil rents that accrue to the state, together with a lack of formal and transparent mechanisms to facilitate citizen oversight, are a large part of the problem. They consider the nature of the fiscal contract between the Venezuelan government and its people. This has been characterized by increasing discretion of the executive; only a small share of the rents is now subject to political oversight within the framework of the budgetary system. The authors consider the case for direct distribution of rents, distinguishing it from a populist approach to transfers as effected through Venezuela's misiones. They also report on focus group discussions of the directdistribution approach and the political viability of direct transfers.
Topic:
Civil Society, Economics, Energy Policy, Government, Oil, and Political Economy
Political Geography:
Argentina and Latin America

6. Why Did Abolishing Fees Not Increase Public School Enrollment in Kenya?

Author:
Tessa Bold, Mwangi Kimenyi, Germano Mwabu, and Justin Sandefur
Publication Date:
10-2011
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
A large empirical literature has shown that user fees signicantly deter public service utilization in developing countries. While most of these results reflect partial equilibrium analysis, we find that the nationwide abolition of public school fees in Kenya in 2003 led to no increase in net public enrollment rates, but rather a dramatic shift toward private schooling. Results suggest this divergence between partial- and general-equilibrium effects is partially explained by social interactions: the entry of poorer pupils into free education contributed to the exit of their more affluent peers.
Topic:
Education, Government, and Poverty
Political Geography:
Kenya and Africa

7. The High Return to Private Schooling in a Low-Income Country

Author:
Tessa Bold, Mwangi Kimenyi, Germano Mwabu, and Justin Sandefur
Publication Date:
12-2011
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Existing studies from the United States, Latin America, and Asia provide scant evidence that private schools dramatically improve academic performance relative to public schools. Using data from Kenya—a poor country with weak public institutions—we find a large effect of private schooling on test scores, equivalent to one full standard deviation. This finding is robust to endogenous sorting of more able pupils into private schools. The magnitude of the effect dwarfs the impact of any rigorously tested intervention to raise performance within public schools. Furthermore, nearly two thirds of private schools operate at lower cost than the median government school.
Topic:
Development, Education, Government, and Poverty
Political Geography:
Kenya, United States, Asia, and Latin America

8. Quid Pro Quo: Builders, Politicians, and Election Finance in India

Author:
Devesh Kapur and Milan Vaishnav
Publication Date:
12-2011
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
In developing countries where elections are costly and accountability mechanisms weak, politicians often turn to illicit means of financing campaigns. This paper examines one such channel of illicit campaign finance: India's real estate sector. Politicians and builders allegedly engage in a quid pro quo, whereby the former park their illicit assets with the latter, and the latter rely on the former for favorable dispensation. At election time, however, builders need to re-route funds to politicians as a form of indirect election finance. One observable implication is that the demand for cement, the indispensible raw material used in the sector, should contract during elections since builders need to inject funds into campaigns. Using a novel monthly-level data set, we demonstrate that cement consumption does exhibit a political business cycle consistent with our hypothesis. Additional tests provide confidence in the robustness and interpretation of our findings.
Topic:
Corruption, Democratization, Government, and Politics
Political Geography:
South Asia and India

9. How Can Bill and Melinda Gates Increase Other People\'s Donations to Fund Public Goods?

Author:
Dean Karlan and John A. List
Publication Date:
04-2011
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
We develop a simple theory which formally describes how charities can resolve the information asymmetry problems faced by small donors by working with large donors to generate quality signals. To test the model, we conducted two large-scale natural field experiments. In the first experiment, a charity focusing on poverty reduction solicited donations from prior donors and either announced a matching grant from the Bill and Melinda Gates Foundation, or made no mention of a match. In the second field experiment, the same charity sent direct mail solicitations to individuals who had not previously donated to the charity, and tested whether naming the Bill and Melinda Gates Foundation as the matching donor was more effective than not identifying the name of the matching donor. The first experiment demonstrates that the matching grant condition generates more and larger donations relative to no match. The second experiment shows that providing a credible quality signal by identifying the matching donor generates even more and larger donations than not naming the matching donor. Importantly, the treatment effects persist long after the matching period, and the quality signal is quite heterogeneous—the Gates\' effect is much larger for prospective donors who had a record of giving to "poverty-oriented" charities. These two pieces of evidence support our model of quality signals as a key mechanism through which matching gifts inspire donors to give.
Topic:
Development, Government, Humanitarian Aid, Markets, and Foreign Aid
Political Geography:
United States

10. Failed States, Vicious Cycles, and a Proposal

Author:
Raghuram G. Rajan
Publication Date:
03-2011
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Rajan examines the problems of failed states, including the repeated return to power of former warlords, which he argues causes institutions to become weaker and people to get poorer. He notes that economic power through property holdings or human capital gives people the means to hold their leaders accountable. In the absence of such distributed power, dictators reign. Rajan argues that in failed states, economic growth leading to empowered citizenry is more likely if a neutral party presides. He proposes a unique solution to allow the electorate to choose a foreigner, who would govern for a fixed term. Candidates could be proposed by the UN or retired leaders from other countries; they would campaign on a platform to build the basic foundations of government and create a sustainable distribution of power. Rajan emphasizes that this is not a return to the colonial model—the external candidate (like all the others) would be on a ballot and the electorate would choose whether he or she was their best chance to escape fragility.
Topic:
Democratization, Development, Economics, Government, and Fragile/Failed State
Political Geography:
United Nations

11. The Illusion of Equality: The Educational Consequences of Blinding Weak States, For Example

Author:
Lant Pritchett and Martina Viarengo
Publication Date:
08-2009
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Does the government control of school systems facilitate equality in school quality? There is a trade-off. On the one hand, government direct control of schools, typically through a large scale hierarchical organization, could produce equalization across schools by providing uniformity in inputs, standards, and teacher qualifications that localized individually managed schools could not achieve. But there is a tendency for large scale formal bureaucracies to “see” less and less of localized reality and hence to manage on the basis of a few simple, objective, and easily administratively verified characteristics (e.g. resources per student, formal teacher qualifications). Whether centralized or localized control produces more equality depends therefore not only on what “could” happen in principle but what does happen in practice. When government implementation capacity is weak, centralized control could lead to only the illusion of equality: in which central control of education with weak internal or external accountability actually allows for much greater inequalities across schools than entirely “uncontrolled” local schools. Data from Pakistan, using results from the LEAPS study, and from two states of India show much larger variance in school quality (adjusted for student characteristics) among the government schools—because of very poor public schools which continue in operation. We use the PISA data to estimate school specific learning achievement (in mathematics, science, and reading) net of individual student and school average background characteristics and compare public and private schools for 34 countries. For these countries there is, on average, exactly the same inequality in adjusted learning achievement across the private schools as across the public schools. But while inequality is the same on average, in some countries, such as Denmark, there was much more equality within the public sector while in others, such as Mexico, there was much more inequality among the public schools. Among the 18 non-OECD participating PISA countries the standard deviation across schools in adjusted quality was, on average, 36 percent higher in government than in private schools. In cases with weak states the proximate cause of high inequality again was that the public sector distribution of performance had a long left tail—schools with extremely poor performance. Relying on blinded weak states for top-down control of educational systems can be lose-lose relative to localized systems relying on bottom-up control—producing worse average performance and higher inequality.
Topic:
Economics, Education, Government, Political Economy, and Social Stratification
Political Geography:
Pakistan and India

12. A Fresh Look at Global Governance: Exploring Objective Criteria for Representation

Author:
Vijaya Ramachandran, Enrique Rueda-Sabater, and Robin Kraft
Publication Date:
02-2009
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
The geopolitical world of the 21st century is very different than that of the post–World War II era. In this new world order, what constitutes a system of global governance? We argue that it has to balance representation, which is made credible by the inclusion of key parts of the global community, and effectiveness, which means involving as small a number of actors as possible while having access to the resources—and clout—to turn decisions/intentions into action/results. In this paper, we propose simple, fundamental criteria—based on global shares of GDP and population—around which global governance might be organized. We analyze the role that these criteria would assign to different countries and compare them with some of the key components of the system of governance currently in place—the Bretton Woods institutions and the United Nations. We also examine the implications of our analysis for membership in the G-20 and the OECD. We find major disparities, which suggest the need for fundamental changes in sharp contrast to the incremental changes that are currently being considered. Overall, our analysis points to the need for a more comprehensive approach, and for much more than incremental solutions.
Topic:
Globalization, Government, International Organization, International Political Economy, and Political Theory
Political Geography:
United Nations

13. Why Warner-Lieberman Failed and How to Get America's Working Families behind the Next Cap-and-Trade Bill

Author:
David Wheeler
Publication Date:
07-2008
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Among partisans of greenhouse gas emissions regulation, the Senate's failure to pass the Warner-Lieberman cap-and-trade bill is often attributed to rampant denial, fueled by diehard political conservatism, energy-company propaganda, and government suppression of evidence on global warming. If so, the solution to the problem is electoral change, exposure of the propaganda, and public education. However, public concern is already so widespread that even leaders of the Southern Baptist Convention have acknowledged the need for action. In this paper, I consider two additional forces that have stymied carbon emissions regulation in developing countries. The first is the perception that costly carbon regulation promoted by the rich will inflict an unjust burden on the poor. The second is hostility to taxation of critical fossil-fuel resources that were developed long before climate risk was identified. My econometric analysis suggests that these same forces have significantly affected senators' votes on Warner-Lieberman. By implication, Congress is not likely to approve cap-and-trade legislation unless Americans with below-median incomes are compensated for expected losses. My analysis supports recent proposals for direct distribution of emissions permit auction revenues to American families on an equal per-capita basis.
Topic:
Climate Change, Environment, Government, Markets, and Politics
Political Geography:
America

14. Reviving Economic Growth in Liberia

Author:
Steve Radelet
Publication Date:
11-2007
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Liberia was decimated by 25 years of gross economic mismanagement and 14 years of brutal civil war. GDP fell by over 90% in less than two decades, one of the largest economic collapses in the world since World War II. This paper explores the challenges in reinvigorating rapid, inclusive, and sustained economic growth in the post-war environment. It stresses the importance of not just reigniting growth, but rebuilding the economy in a way that avoids the substantial income concentration of the past and creates significant economic opportunities to groups that were marginalized and excluded in the past. It examines the new government's progress so far, including the major steps it has taken in its first 18 months and the unique way that it has organized government-donor relations.
Topic:
Development, Government, International Cooperation, and International Political Economy
Political Geography:
Africa and Liberia

15. Do No Harm: Aid, Weak Institutions, and the Missing Middle in Africa

Author:
Nancy Birdsall
Publication Date:
03-2007
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
The implicit assumption of the donor community is that Africa is trapped by its poverty, and that aid is necessary if Africa is to escape the trap. In this note I suggest an alternative assumption: that Africa is caught in an institutional trap, signaled and reinforced by the small share of income of its independent middle-income population. Theory and historical experience elsewhere suggest that a robust middle-income group contributes critically to the creation and sustenance of healthy institutions, particularly healthy institutions of the state. I propose that if external aid is to be helpful for institution-building in Africa's weak and fragile states, donors need to emphasize not providing more aid but minimizing the risks more aid poses for this group in Africa.
Topic:
Corruption, Development, Government, and Humanitarian Aid
Political Geography:
Africa

16. Why Doesn't Africa Get More Equity Investment? Frontier Stock Markets, Firm Size and Asset Allocations of Global Emerging Market Funds

Author:
Vijaya Ramachandran, Scott Standley, and Todd Moss
Publication Date:
02-2007
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
This paper addresses the question of investment in sub-Saharan African listed securities by examining characteristics of the continent's 15 equity markets, the rise and fall of African regional funds, and the asset allocation trends for global emerging market (GEM) funds. The data shows that South Africa is now a leading destination of capital, but that few managers invest elsewhere on the continent. However, we find that African markets are not treated differently than other markets and present evidence that small market size and low levels of liquidity are a binding deterrent for foreign institutional investors. Thus, orthodox market variables rather than market failure appear to explain Africa's low absolute levels of inward equity flows. The paper then turns to new data from firm surveys to explore why African firms remain small. The implications of our findings are threefold: (a) efforts to encourage greater private investment in these markets should concentrate on domestic audiences and specialized regional funds, (b) the depth and success of the Johannesburg Stock Exchange can perhaps be better utilized to benefit other parts of the continent, and (c) any long-term strategy should concentrate on the underlying barriers to firm entry and growth.
Topic:
Government, International Trade and Finance, and Markets
Political Geography:
Africa and South Africa

17. Fragile States and U.S. Foreign Assistance: Show Me the Money

Author:
Stewart Patrick and Kaysie Brown
Publication Date:
08-2006
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
The Bush administration has increasingly acknowledged that weak and failing states represent the core of today's global development challenge. It has also recognized that such states are potential threats to international peace and security. But despite the rhetoric, it has yet to formulate a coherent strategy around fragile states or commit adequate resources towards engaging them. Excluding funding for Iraq, Afghanistan, Pakistan, and HIV/AIDS, the administration's FY07 budget request proposes to spend just $1.1 billion in direct bilateral assistance to fragile states—little more than a dollar per person per year. In this new working paper, CGD research fellow Stewart Patrick and program associate Kaysie Brown urge U.S. policymakers to consider increasing aid to fragile states and to think creatively about how and when to engage these troubled countries. The authors also call for the policy community to integrate non-aid instruments into a more coherent government strategy. To put its money where its mouth is, the U.S. should treat aid to weak and failing states as a form of venture capital, with high risk but potentially high rewards.
Topic:
Economics, Government, and Humanitarian Aid
Political Geography:
Pakistan, Afghanistan, United States, and Iraq

18. Social Cohesion, Institutions

Author:
William Easterly, Michael Woolcock, and Jozef Ritzen
Publication Date:
08-2006
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
We present evidence that measures of “social cohesion,” such as income inequality and ethnic fractionalization, endogenously determine institutional quality, which in turn casually determines growth.
Topic:
Civil Society, Development, Government, and Poverty
Political Geography:
Global Focus

19. The Economics of Young Democracies: Policies and Performance

Author:
Nathan Converse and Ethan Kapstein
Publication Date:
03-2006
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Since the “third wave” of democratization began in 1974, nearly 100 states have adopted democratic forms of government, including, of course, most of the former Soviet bloc nations. Policy-makers in the west have expressed the hope that this democratic wave will extend even further, to the Middle East and onward to China. But the durability of this new democratic age remains an open question. By some accounts, at least half of the world's young democracies—often referred to in the academic literature as being “unconsolidated” or “fragile”—are still struggling to develop their political institutions, and several have reverted back to authoritarian rule. Among the countries in the early stages of democratic institution building are states vital to U.S. national security interests, including Afghanistan and Iraq.
Topic:
Democratization, Development, Economics, and Government
Political Geography:
Afghanistan, China, and Iraq

20. Governance and Corruption in Public Health Care Systems

Author:
Maureen Lewis
Publication Date:
01-2006
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
What factors affect health care delivery in the developing world? Anecdotal evidence of lives cut tragically short and the loss of productivity due to avoidable diseases is an area of salient concern in global health and international development. This working paper looks at factual evidence to describe the main challenges facing health care delivery in developing countries, including absenteeism, corruption, informal payments, and mismanagement. The author concludes that good governance is important in ensuring effective health care delivery, and that returns to investments in health are low where governance issues are not addressed.
Topic:
Corruption, Government, Health, and Third World