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Begin New Search Topic Development Content Type Working Paper Publishing Institution United Nations University

101. The Rise and Halt of Economic Development in Brazil, 1945-2004: Industrial Catching-up, Institutional Innovation and Financial Fragility

Author:
Nelson H. Barbosa-Filho, José A.P. de Souza, and Leondardo Burlamaqui
Publication Date:
08-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper seeks to explain the dynamics of Brazilian industrial catch-up in the last 60 years by discussing its background institutional conditions as well as its main macroeconomic features. After a brief introduction, the second section describes how after the institutional innovations introduced during the Vargas' and Kubitschek's administrations, a Brazilian version of the Developmental State was created, releasing the growth potential of the economy during the 1950s. The third section analyses the inflationary crisis and institutional inertia of the mid-1960s, and its solution through the introduction of a new of wave of institutional innovations and conflict management devices, which lead to the Brazilian growth miracle, until the debt crisis of early 1980s signaled its end. The fourth section analyses why the financial crisis, coupled with ineffective institutional changes and unsuccessful macroeconomic stabilization plans lead growth to a halt. It also includes an analysis of the pro-market reforms from the early 1990s onwards. The fifth section concludes the paper offering a brief sketch on how the analytical narrative fits the conceptual framework within which it was performed.
Topic:
Conflict Resolution, Development, and Economics
Political Geography:
Brazil and South America

102. Primary Education in India: Prospects of Meeting the MDG Target

Author:
Bernarda Zamora and Sonia Bhalotra
Publication Date:
07-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper uses two large repeated cross-sections, one for the early 1990s, and one for the late 1990s, to describe growth in school enrolment and completion rates for boys and girls in India, and to explore the extent to which enrolment and completion rates have grown over time. It decomposes this growth into a component due to changes in the characteristics that determine schooling, and another associated with changes in the responsiveness of schooling to given characteristics. Our results caution against the common practice of using current data to make future projections on the assumption that the model parameters are stable. The analysis nevertheless performs illustrative simulations relevant to the question of whether India will be able to achieve the Millennium Development Goal of realising universal primary education by the year 2015. The simulations suggest that India will achieve universal attendance, but that primary school completion rates will not exhibit much progress.
Topic:
Civil Society, Development, and Education
Political Geography:
India and Asia

103. Reconstruction from Breakdown in Northeastern India: Building State Capability

Author:
M. Sajjad Hassan
Publication Date:
07-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The northeast region of India remains fraught with severe violence, poor growth and acute frustration among its youth. Success of policies to resolve the region's crisis has proved less than encouraging. What could be the way out of the violence–poor growth trap? This paper argues that a key determinant of the instability in the region is the absence of the effective role of the state: to provide security and opportunities for social and economic wellbeing equitably to all sections of society; and to uphold the rule of law. For reconstruction to work the state must act to provide key political goods to all its citizens, and restore its legitimate authority by implementing policies and enforcing laws cleanly and transparently. Political leaders can contribute to this endeavour by organizing politics inclusively.
Topic:
Conflict Resolution, Development, and Government
Political Geography:
India and Asia

104. Institutionalism Ancient, Old and New: A Historical Perspective on Institutions and Uneven Development

Author:
Eric S. Reinert
Publication Date:
07-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper argues for an 'ancient' institutional school, predating Thorstein Veblen's 'old' institutionalism. In this view, going back as far as the thirteenth century, institutions tended to be seen as specific to a mode of production. Here both institutions and development itself are context-specific and activity-specific. Much clearer than today the arrows of causality of economic development go from the mode of production to the institutional setting, not vice versa. In order to understand development, institutions can also usefully be divided into Hayekian institutions that facilitate equilibrium and Schumpeterian institutions that enable the dynamics of development and structural change.
Topic:
Development, Economics, and Education

105. Rethinking Import-substituting Industrialization: Development Strategies and Institutions in Taiwan and China

Author:
Tianbiao Zhu
Publication Date:
07-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Conventional explanations of Taiwan and China's economic success point to the shift from an import-substituting industrialization (ISI) strategy to an export-oriented industrialization (EOI) strategy. This paper argues that the development strategies in Taiwan and China have always been a combination of ISI and EOI strategies during their entire miracle-creating period; far from the shift from ISI to EOI strategies, export promotion was used in both cases to sustain ISI, which has always been the central focus of development. Behind this strategy there is a set of institutions in both Taiwan and China, which has played a key role in supporting ISI, in particular, the government, the bank sector, public enterprises, and their relationship.
Topic:
Development and Industrial Policy
Political Geography:
China, Israel, Taiwan, East Asia, and Asia

106. The Formation of a Mercantilist State and the Economic Growth of the United Kingdom 1453-1815

Author:
Patrick Karl O'Brien
Publication Date:
07-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
New institutional economics lacks a theory of state formation which could help us to deal with the mega question of why some states became more efficient than others at establishing and and sustaining institutions. Some kind of middle range theory could be formulated based upon historical case studies. This paper considers the case of Britain and as its title suggests degrades the myth of the United Kingdom as the paradigmn example of liberalism and laisser faire. In making its precocious transition to and industrial market economy the kingom's history is best represented as a case of successful mercantilism.
Topic:
Development, Economics, and Sovereignty
Political Geography:
Britain, United Kingdom, and Europe

107. The Political Economy of Taxation and Tax Reform in Developing Countries

Author:
Jonathan Di John
Publication Date:
07-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Taxation provides one of the principal lenses in measuring state capacity, state formation and power relations in a society. This paper critically examines three main approaches (economic, administrative and political economy) to understanding taxation. It also examines differences in tax composition across middle-income developing regions and finds that Latin American economies tax upper income groups much less than in East Asia and Eastern Europe, and explores the political economy and policy implications of these differences. The paper also examines issues of tax reform in low income/post-war economies and explores the problem that capital flight poses for less developed countries.
Topic:
Development, International Trade and Finance, Political Economy, and Third World
Political Geography:
Eastern Europe, East Asia, and Latin America

108. Institutions and Economic Performance in Africa: A Comparative Analysis of Mauritius

Author:
Julius Kiiza
Publication Date:
07-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper examines the relationship between institution building and economic performance in Mauritius, Botswana and Uganda. The rationale for comparing these cases is simple. While the three have been super-economic stars in their own right, they have achieved substantially different outcomes. Mauritius has achieved Asia-type rapid growth, backed by the structural transformation of the economy from colonial commodity production (sugar) to postcolonial higher value-added industrial and information outcomes. Botswana has delivered rapid and sustained growth with no structural economic transformation. Uganda has attained rapid growth for a shorter postcolonial period (since 1992) and with no structural transformation. This paper contends that these cross-national differences largely arise from the presence of developmental nationalism plus Weberian bureaucracies in Mauritius and Botswana, and their absence in Uganda.
Topic:
Development, Economics, and Nationalism
Political Geography:
Uganda, Africa, Mauritius, and Botswana

109. The Role of Federalism in Developing the US during Nineteenth-century Globalization

Author:
Eric Rauchway
Publication Date:
07-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
During its development into a continental empire, the US, like other countries relied on the investment of capital and labour from abroad; unlike other countries, the US had a peculiar political institution, federalism, which channeled these resources and also determined the course of protest against these resources. The paper argues that federalism played a key role in determining the course of US economic development and reaction to this early instance of globalization, a role with possible lessons for other countries today.
Topic:
Development, Globalization, and Politics
Political Geography:
United States

110. Corporate Governance, Innovative Enterprise, and Economic Development

Author:
William Lazonick
Publication Date:
07-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The notion that good corporate governance means maximizing shareholder value derives from the neoclassical theory of the market economy. I explain why this perspective is highly problematic for understanding the operation and performance of the business corporation and hence the institutions that, for the sake of economic development, should govern it. The main problem is that the market-economy perspective cannot comprehend the process of innovation, including the role of the business corporation. I construct a theory of the innovating firm that, when embedded in comparative-historical analysis, provides a basis for analyzing the relation between corporate governance institutions and economic development.
Topic:
Development, Economics, Government, and Markets

111. Gender, Local Knowledge, and Lessons Learnt in Documenting and Conserving Agrobiodiversity

Author:
Regina Laub and Yianna Lambrou
Publication Date:
06-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper explores the linkages between gender, local knowledge systems and agrobiodiversity for food security by using the case study of LinKS, a regional FAO project in Mozambique, Swaziland, Zimbabwe and Tanzania over a period of eight years and now concluded. The project aimed to raise awareness on how rural men and women use and manage agrobiodiversity, and to promote the importance of local knowledge for food security and sustainable agrobiodiversity at local, institutional and policy levels by working with a diverse range of stakeholders to strengthen their ability to recognize and value farmers' knowledge and to use gender-sensitive and participatory approaches in their work. This was done through three key activities: capacity building, research and communication. The results of the LinKS study show clearly that men and women farmers hold very specific local knowledge about the plants and animals they manage. Local knowledge, gender and agrobiodiversity are closely interrelated. If one of these elements is threatened, the risk of losing agrobiodiversity increases, having negative effects on food security. Increased productivity, economic growth and agricultural productivity are important elements in poverty reduction. The diverse and complex agroecological environment of Sub-Saharan Africa requires that future efforts be based on more localized solutions while maintaining a global outlook. Food security will have to build much more on local knowledge and agrobiodiversity with a clear understanding of gender implications while keeping in mind the continuously changing global socioeconomic and political conditions.
Topic:
Agriculture, Development, and Gender Issues
Political Geography:
Africa, Mozambique, Tanzania, Zimbabwe, and Swaziland

112. Food Security in Vietnam during the 1990s: The Empirical Evidence

Author:
Vasco Molini
Publication Date:
06-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Analysing the performance of ten developing countries, Hoddinot and Yohannes (2002) find a strong association between two measures of food security (calorie intake and mostly dietary diversity) and the increase in expenditures per capita. Using various indicators of food security, we describe the changes in food balances in Vietnam and find evidence of a substitution of poor micronutrients items (rice and cereals) with rich ones like fruit, vegetables fish and meat. Poor households, while increasing the amount of calories consumed, still lack vitamins, iron, calcium, etc. A preliminary assessment of the food security variation showed that improvements were, as expected, more concentrated among the richer Vietnamese households than the poor ones, although there was some improvement among poorer strata as well. We also focus on the calorie/expenditure elasticity and compare results for the years 1993 and 1998. Our findings confirm that this link is strong, and show that calorie income elasticity changed in the expected direction. We conclude that in general food security improved in Vietnam during 1990s although considerable differences still remain among expenditure deciles and among regions due to the accentuated spatial difference.
Topic:
Security, Development, and Human Welfare
Political Geography:
Asia and Vietnam

113. Development of Financial Intermediation and the Dynamics of Rural-Urban Inequality: China, 1978-98

Author:
Qi Zhang, Mingxing Liu, and Yiu Por Chen
Publication Date:
06-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Using China as a test case, this paper empirically investigates how the development of financial intermediation affects rural-urban income disparity (RUID). Using 20-year province level panel data, we find that the level of financial development is positively correlated with RUID. Examining two subperiods, 1978-88 and 1989-98, we test several competing hypotheses that may affect RUID. We find that the increase of RUID may be explained by fiscal policy during the first period and financial intermediates during the second period. In addition, we show that the direction of the Kuznets effect on RUID is sensitive to changes in government development policies. The rural development policies during the first period may have enhanced the rural development and reduced RUID. However, the financial intermediary policy during the second period focused on urban development and increased both urban growth and intra-urban inequalities, thus leading to an increase in RUID. Finally, we show that RUID is insensitive to the provincial industrial structure (the share of primary industry in GDP). These results are consistent with the traditional urban-bias hypothesis and are robust to the inclusion of controls for endogeneity issues. This study adds to the economic inequality literature by clarifying the effects of government policies on the underlying dynamics on convergent and divergent effects on rural-urban inequality.
Topic:
Development, Economics, and Government
Political Geography:
China and Asia

114. How Should We Measure Global Poverty in a Changing World?

Author:
Kuan Xu and Lars Osberg
Publication Date:
06-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Before effective anti-poverty policy can be designed and implemented, the extent, trend and distribution of poverty must be identified. In this sense, poverty measurement is a crucial intermediate step in public policymaking and development planning. This paper asks whether the estimated proportion of the world's population with income below US$1 (adjusted according to purchasing power parity) per day is a good measure of trends in global poverty. We argue that the answer depends on two important issues in the measurement of poverty—the definition of the poverty line, and how best to summarize the level of poverty In this paper, we survey the literature on poverty measurement, demonstrate the importance of considering poverty incidence, depth and inequality jointly, present a simple but powerful graphical representation of the Sen and SST indices of poverty intensity (the poverty box) which is the FGT index of order 1 and extend our empirical work to China using the commonly accepted international poverty line definition of one half median equivalent income.
Topic:
International Relations, Development, and Poverty
Political Geography:
China and Asia

115. Poverty Accounting by Factor Components: With an Empirical Illustration Using Chinese Data

Author:
Guanghua Wan
Publication Date:
06-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The purpose of this paper is to develop two poverty decomposition frameworks and to illustrate their applicability. A given level of poverty is broadly decomposed into an overall inequality component and an overall endowment component in terms of income or consumption determinants or input factors. These components are further decomposed into finer components associated with individual inputs. Also, a change in poverty is decomposed into components attributable to the growth and redistributions of factor inputs. An empirical illustration using Chinese data highlights the importance of factor redistributions in determining poverty levels and poverty changes in rural China.
Topic:
Development, Economics, and Poverty
Political Geography:
China and Asia

116. The Gender Dimensions of Post-Conflict Reconstruction: The Challenges in Development Aid

Author:
Elaine Zuckerman and Marcia E. Greenberg
Publication Date:
06-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Based on analysing World Bank and other donor post-conflict reconstruction (PCR) loans and grants from rights-based, macroeconomic and microeconomic perspectives, we conclude that few PCR projects identify or address gender discrimination issues. Bank PCR investments hardly reflect Bank research recognizing that gender inequality increases the likelihood of conflict and gender equality is central to development and peace. Our conceptual framework examining women's programmes, gender mainstreaming, and gender roles in transforming violent into peaceful societies, leads to recommending that PCR projects systematically address gender issues and promote gender equality to make peace work.
Topic:
Development, Gender Issues, Humanitarian Aid, and International Trade and Finance

117. Asia's Labour-Driven Economic Development, Flying-Geese Style: An Unprecedented Opportunity for the Poor to Rise?

Author:
Terutomo Ozawa
Publication Date:
06-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The notion of 'shared growth' was introduced by the World Bank in recognition of East Asia's rapid growth accompanied by poverty reduction. It emphasizes the criticality of pro-poor policies and institutional setups in the fast-developing East Asian economies. The efforts of these individual countries are, however, a necessary but not sufficient condition (explanation). There is a more essential, underlying region-wide mechanism that simultaneously promotes regionalized growth and specifically favours Asia's working mass of unskilled labour. Such an efficacious mechanism is posited in the 'flying-geese paradigm of comparative advantage recycling in labour-intensive goods'. The paper argues that a number of favourable factors have fortuitously coalesced to engender a considerably favourable condition for Asia's rapid catch-up growth in which unskilled labour (the poor) can participate as their countries' most vital input in labour-driven development.
Topic:
Development, Economics, and Poverty
Political Geography:
East Asia and Asia

118. Trade, Migration, and Poverty Reduction in the Globalizing Economy: The Case of the Philippines

Author:
Jonna P. Estudillo and Yasuyuki Sawada
Publication Date:
06-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper investigates how the two types of globalization—i.e., integration of international trade and emigration—affected poverty reduction in the Philippines. Using the Family Income and Expenditure Surveys from 1985 to 2000, we found that both nontransfer and transfer incomes decreased poverty significantly but transfer income exerted greater impact. External openness reduced poverty significantly before the Asian currency crises but its impact had been reversed since. The effect of land reform in inducing transfer income from abroad was significant only in the 1990s. Yet, the ultra poor were bypassed in the land reform-credit-emigration-transfer nexus.
Topic:
Development, Globalization, International Trade and Finance, and Migration

119. Pro-Poor Growth: The Asian Experience

Author:
Hyun H. Son and Nanak Kakwani
Publication Date:
06-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper looks into the interrelation between economic growth, inequality, and poverty. Using the notion of pro-poor growth, this study examines to what extent the poor benefit from economic growth. First, various approaches to defining and measuring pro-poor growth are scrutinized using a variety of criteria. It is argued that the satisfaction of a monotonicity axiom is a key criterion for measuring pro-poor growth. The monotonicity axiom sets out a condition that the proportional reduction in poverty is monotonically an increasing function of the pro-poor growth measure. This paper proposes a pro-poor growth measure that satisfies the monotonicity criterion. This measure is called the 'poverty equivalent growth rate', which takes into account both the magnitude of growth and how the benefits of the growth are distributed to the poor and the non-poor. As the new measure satisfies the criterion of monotonicity, it is indicative that to achieve a rapid poverty reduction, the poverty equivalent growth rate ought to be maximized rather than the actual growth rate. The methodology developed in the paper is then applied to Asian countries, including the Republic of Korea, Thailand, and Vietnam.
Topic:
Development, Economics, and Poverty
Political Geography:
Asia, Vietnam, Korea, and Thailand

120. From Seers to Sen: The Meaning of Economic Development

Author:
Wayne Nafziger
Publication Date:
01-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The paper compares perspectives on the meaning of development in the late 1970s and early 1980s to the contemporary period, with a focus on the works of Dudley Seers and Amartya Sen. Both men were critical of the development literature of their times. Seers was especially critical of neoclassicism's universal claims and economic growth as the prime objective. For Sen, development involves reducing deprivation or broadening choice. One challenge for future work is for development economists, similar to Seers and Sen, to be more holistic, integrating economic development, human rights, and conflict reduction.
Topic:
Development, Economics, and Poverty

121. Central Banks as Agents of Economic Development

Author:
Gerald Epstein
Publication Date:
05-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
In the last two decades, there has been a global sea change in the theory and practice of central banking. The currently dominant 'best practice' approach to central banking consists of the following: (1) central bank independence (2) a focus on inflation fighting (including adopting formal 'inflation targeting') and (3) the use of indirect methods of monetary policy (that is, short-term interest rates as opposed to direct methods such as credit ceilings). This paper argues that this neo-liberal approach to central banking is highly idiosyncratic in that, as a package, it is dramatically different from the historically dominant theory and practice of central banking, not only in the developing world, but, notably, in the now developed countries themselves. Throughout the early and recent history of central banking in the US, England, Europe, and elsewhere, financing governments, managing exchange rates, and supporting economic sectors by using 'direct methods' of intervention have been among the most important tasks of central banking and, indeed, in many cases, were among the reasons for their existence. The neo-liberal central bank policy package, then, is drastically out of step with the history and dominant practice of central banking throughout most of its history.
Topic:
Development and Economics
Political Geography:
United States, Europe, and England

122. The Rule of Law, Legal Traditions, and Economic Growth in East Asia

Author:
Meredith Woo-Cumings
Publication Date:
05-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper examines the literature on the rule of law and economic development, and in particular the influential argument by La Porta et al., on the superiority of the Anglo-American common law system in fostering financial development. In this paper I show that however compelling their argument might be, legal traditions and institutions do not determine the nature of the state, nor its likely role in the economy—nor do they critically determine the course of economic development. I build my case by examining the real and informal mechanisms of state intervention in the economy in East Asia.
Topic:
Development, Economics, and International Law
Political Geography:
America, Israel, and East Asia

123. Modern Bureaucracy

Author:
Joseph Toye and John Toye
Publication Date:
05-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Max Weber believed that bureaucracy could be understood by analysing its ideal-typical characteristics, and that these characteristics would become more pervasive as the modern age advanced. Weber's horizontal account of bureaucracy can be criticised on various grounds, including its unrealistic notion of bureaucratic rationality. An alternative view is proposed, namely, that the development of state bureaucracies is driven by the trajectory of the highpower politics in which they are nested.
Topic:
Development, Economics, and Politics

124. Finance and Poverty in Ethiopia: A Household Level Analysis

Author:
Alemayehu Geda, Daniel Zerfu, and Abebe Shimeles
Publication Date:
05-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
In this paper, using the rich household panel data of urban and rural Ethiopia that covers the period from 1994 to 2000, we attempted to establish the link between finance and poverty in Ethiopia. Our results show that access to finance is an important factor in consumption smoothing and hence poverty reduction. We also found evidence for a poverty trap due to liquidity constraints that limits the ability of the rural households from consumption smoothing. The empirical findings from this study could inform finance policies aimed at addressing issues of poverty reduction.
Topic:
Development, Economics, and Poverty
Political Geography:
Africa and Ethiopia

125. Manufacturing, Services and Premature Deindustrialization in Developing Countries: A Kaldorian Analysis

Author:
Ajit Singh and Sukti Dasgupta
Publication Date:
05-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper uses a Kaldorian framework to examine the evidence of deindustrialization in developing countries at low levels of income, the jobless growth in these economies and the fast expansion of the informal sector. The questions are specifically examined for the Indian economy, using state level data but the analysis has a wider application for economic policy in developing countries.
Topic:
Development, Economics, Industrial Policy, and Third World
Political Geography:
India

126. Development Strategy, Viability, and Economic Institutions: The Case of China

Author:
Mingxing Liu, Pengfei Zhang, Shiyuan Pan, and Justin Yifu Lin
Publication Date:
05-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper explores the politically determined development objectives and the intrinsic logic of government intervention policies in east developed countries. It is argued that the distorted institutional structure in China and in many least developed countries, after the Second World War, can be largely explained by government adoption of inappropriate development strategies. Motivated by nation building, most least-developed countries, including the socialist countries, adopted a comparative advantage defying strategy to accelerate the growth of capital-intensive, advanced sectors in their countries. In the paper we also statistically measure the evolution of government development strategies and the economic institutions in China from 1950s to 1980s to show the co-existence and coevolution of government adoption of comparative advantage defying strategy and the trinity system.
Topic:
Development, Economics, and Government
Political Geography:
China and Asia

127. Absorptive Capacity and Achieving the MDGs

Author:
Mark Sundberg and Franois Bourguignon
Publication Date:
05-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The ability of low-income countries to productively absorb large amounts of external assistance is a central issue for efforts to scale-up aid. This paper examines absorptive capacity in the context of MDG-based development programmes in low-income countries. It first defines absorptive capacity, and proposes a framework for measuring it. Applying a dynamic computable general equilibrium model to link the macro framework to sector results, the paper simulates MDG scenarios for Ethiopia and examines the role of infrastructure, skilled labour, macroeconomic, and other constraints on absorptive capacity. The main policy conclusions are that careful sequencing of public investment across sectors is key to minimizing the costs of reaching the MDGs; the macro impact of large aid flows on the tradeables sector can potentially be serious in the short run; large-scale frontloading of aid disbursements can be costly as it pushes against absorptive constraints; and that improvement of governance and institutional structures can significantly reduce the cost of achieving the MDGs.
Topic:
International Relations, Development, Humanitarian Aid, and Third World

128. A Quest for Pro-Poor Globalization

Author:
Erik Thorbecke and Machiko Nissanke
Publication Date:
05-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
While the opportunities offered by globalization can be large, the question is often raised whether the actual distribution of gains is fair and, in particular, whether the poor benefit proportionately less from globalization and could under some circumstances actually be hurt by it. The paper discusses channels and transmission mechanisms through which the process of globalization affects different aspects and dimensions of poverty in the developing world. It examines how these numerous channels interact, as the net effects on poverty depend on the relative strength of the positive and negative forces of globalization. On the basis of our analysis of these transmission mechanisms from globalization to the world's poor, the paper discusses what may constitute a policy framework for encouraging globalization to be pro-poor.
Topic:
Development, Globalization, Human Welfare, and Poverty

129. Trade Liberalization, Environment and Poverty: A Developing Country Perspective

Author:
M.S. Quresh
Publication Date:
04-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper revisits the pollution haven hypothesis in the context of Pakistan by offering a systematic analysis of its trade and production patterns. Using bilateral trade statistics from 1975-2003, we test the hypotheses that Pakistan's net exports of pollutionintensive products have increased to the OECD countries. We also investigate if the stringency of environmental governance in the importing countries plays a role in determining Pakistan's exports of pollution-intensive products. The results reveal that there has been a change in the composition of output and exports towards pollutionintensive manufacturing that parallels the opening of the economy. Overall, the findings appear to be in favour of the pollution haven hypothesis and call for effective environmental policy response for poverty alleviation and sustainable development.
Topic:
Development, International Trade and Finance, and Poverty
Political Geography:
Pakistan and Asia

130. Economic Development Strategy, Openness and Rural Poverty: A Framework and China's Experiences

Author:
Justin Yifu Lin and Peilin Liu
Publication Date:
04-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper argues that both openness and poverty in a country are endogenously determined by the country's long-term economic development strategy. Development strategies can be broadly divided into two mutually exclusive groups: (i) the comparative advantage-defying (CAD) strategy, which attempts to encourage firms to deviate from the economy's existing comparative advantages in their entry into an industry or choice of technology; and (ii) the comparative advantage-following (CAF) strategy, which attempts to facilitate the firms' entry into an industry or choice of technology according to the economy's existing comparative advantages.
Topic:
Development, Economics, and Poverty
Political Geography:
China and Asia

131. Globalization, Growth and Poverty in India

Author:
Arup Mirtra and N.R. Bhanumurthy
Publication Date:
04-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
In this paper an attempt is made to assess the impact of economic reforms on the incidence of poverty by decomposing the change in poverty ratio between two time points into growth/mean effect, inequality effect and the population shift effect. Based on the National Sample Survey data an analysis has been carried out for two time periods: (i) 1983 to 1993-94 and (ii) 1993-94 to 1999-2000, broadly representing the pre-reform and reform-period respectively, for the rural and urban areas of the fifteen major states, and also for the all-India level. The growth/mean effect, which determines the extent of fall (rise) in poverty incidence due to rise (fall) in mean per capita consumption expenditure, dominates in both the periods over the inequality effect, that estimates the rise (fall) in poverty due to rise (fall) in inequality. It also dominates over the population shift effect, which assesses the net impact on all-areas combined poverty, of a decline (rise) in rural (urban) poverty caused possibly by rural-urban migration. The growth effect, which is beneficial for poverty reduction, seems to have gone up in the reform period. The adverse inequality effect also fell in magnitude in the second period compared to the first. States with a greater beneficial growth effect in the second period relative to the first, also show a fall in the magnitude of an adverse population shift effect in the urban areas, i.e., a relatively less rise in the incidence of urban poverty caused by rural-urban migration.
Topic:
Development, Globalization, and Poverty
Political Geography:
India and Asia

132. Vulnerability to Globalization in India: Relative Rankings of States Using Fuzzy Models

Author:
Brinda Viswanathan and S. Kavi Kumar
Publication Date:
04-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The net impact of globalization on developing countries, and more specifically on the poorer sections of population in these countries, is complex and context dependent, and hence needs to be analysed empirically. This study in the context of globalization attempts to develop regional level indices of vulnerability with respect to welfare loss in India using a methodology based on fuzzy inference systems. The vulnerability of an entity is conceptualized (following the practice in global climate change literature) as a function of its exposure, sensitivity and adaptive capacity. Empirical analysis based on such multidimensional conceptualization demands use of indicator-based approach which is attempted in this study and uses fuzzy models that adequately capture vagueness inherent in such approaches.
Topic:
Development, Economics, and Globalization
Political Geography:
India and Asia

133. Measuring Pro-Poor Progress towards the Non-Income Millennium Development Goals

Author:
Stephen Klasen, Kenneth Harttgen, and Melanie Grosse
Publication Date:
04-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
In order to track progress in MDG1 and explicitly link growth, inequality, and poverty reduction, several measures of 'pro-poor growth' have been proposed in the literature and used in applied academic and policy work. These measures, particularly the ones derived from the growth incidence curve, allow a much more detailed assessment of the distributional impact of growth and its link to poverty reduction. However, there are no corresponding measures for tracking the distribution of progress in non-income dimensions of poverty, and thus the distribution of progress towards MDGs 2-7. In this paper, we propose to extend the pro-poor growth measurement to non-income dimensions of poverty (particularly health and education). We empirically illustrate the approach for Bolivia and show that it allows a much more detailed assessment of progress towards MDGs 2-7 by focusing on the distribution of progress. Furthermore, this extension also allows an explicit assessment of the linkage between progress in MDG1 and MDGs 2-7 as well as extends traditional incidence analysis by quantifying outcomes in non-income dimensions of poverty along the income distribution.
Topic:
Development, Economics, and Poverty
Political Geography:
Europe and Bolivia

134. Gender and Growth in Sub-Saharan Africa: Issues and Evidence

Author:
Stephen Klasen, David Lawson, Sudharshan Canagarajah, and Mark Blackden
Publication Date:
04-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The study suggests that gender inequality acts as a significant constraint to growth in sub-Saharan Africa, and that removing gender-based barriers to growth will make a substantial contribution to realizing Africa's economic potential. In particular we highlight gender gaps in education, related high fertility levels, gender gaps in formal sector employment, and gender gaps in access to assets and inputs in agricultural production as particular barriers reducing the ability of women to contribute to economic growth. By identifying some of the key factors that determine the ways in which men and women contribute to, and benefit (or lose) from, growth in Africa, we argue that looking at such issues through a gender lens is an essential step in identifying how policy can be shaped in a way that is explicitly gender-inclusive and beneficial to growth and the poor. We also argue that in some dimensions and channels of the gender-growth nexus, the evidence is only suggestive and needs further detailed research and analysis. Investigations of the linkage between gender inequality and growth should therefore be a priority for development economics research in coming years.
Topic:
Development, Economics, and Gender Issues
Political Geography:
Africa

135. Do We Need a New "Great Transformation"? Is One Likely?

Author:
Frances Stewart
Publication Date:
04-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Karl Polanyi wrote The Great Transformation in 1944 which analysed the double movement Europe experienced, from a situation where the market was heavily regulated and controlled in the eighteenth century to a virtually unregulated market in the nineteenth century, and the huge transformation in which the market was once more brought under control as a reaction to the poverty, unemployment and insecurity brought about by the unregulated market. Yet in both developed and developing countries there has since been a reaction with a new move towards the market. This paper analyses such processes in contemporary developing countries, and considers whether, in the light of the consequences of the unregulated market, a new Great Transformation is needed. It also considers whether such a transformation is likely, reviewing moves towards increased regulation of the market, and also the challenges faced by any contemporary great transformation arising from globalization and the nature of politics.
Topic:
Development, Markets, and Poverty
Political Geography:
Europe

136. International Risk Tolerance, Capital Market Failure and Capital Flows to Emerging Markets

Author:
Valpy FitzGerald
Publication Date:
04-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The level, tenor and instability of capital flows from global financial markets towards developing countries are a major source of concern for macroeconomic managers, while their causes remain largely unexplained by economic theory. Country 'fundamentals' (such as economic growth, monetary stability and institutional capacity) as sources of default risk have been the main focus of economic research and policy prescriptions. However, recent empirical research on the determinants of capital flows and the roots of market failure indicate that much of the explanation lies in the nature of the home (that is, the developed country) demand for emerging market assets. In this paper, the microeconomic roots of home bias and demand instability are explained in terms of investor risk perception and credit rationing, exacerbated by traders' behaviour. The consequences for host country macroeconomic balances and income distribution of varying investor risk tolerance are then demonstrated. Although the net impact also depends upon the host policy response, this transmission mechanism means that host 'fundamentals' are themselves strongly affected by capital flows and thus cannot be considered as to be independent of home asset demand. The paper concludes by examining the implications of these findings for the future of development economics in general and for policy response in particular.
Topic:
Development, Emerging Markets, Markets, and Third World

137. Three Decades of Rural Development Projects in Asia, Latin America, and Africa: Learning From Successes and Failures

Author:
Annelies Zoomers
Publication Date:
03-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This article aims to contribute to the discussion about how to make development interventions more effective by analyzing the factors contributing to the success or failure of rural development projects. We made an aggregate level analysis of 46 projects in the field of agricultural research (AR), water management (WM), natural resource management (NRM), and integrated rural development (IRD), financed by the Netherlands' Directorate-General for International Cooperation (DGIS) and carried out between 1975-2005 in Asia, Africa and Latin America. Making a distinction between the successful projects and failures, we showed the possibilities and limitations of evaluating projects on the basis of the official criteria (relevance, efficiency, effectiveness, sustainability and impact and/or using criteria such as poverty, gender, institutional development, governance and environment). We learned that project performance very much depends on whether interventions 'keep track' with local priorities and trends. This is much more important than 'measuring output' (are results in line with the project goal?) which is wrongly presented as a priority in monitoring and evaluation practices.
Topic:
Development
Political Geography:
Africa, Asia, and Central America

138. Investing in Health for Economic Development: The Case of Mexico

Author:
Nora Lustig
Publication Date:
03-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Health is an asset with an intrinsic value as well as an instrumental value. Good health is a source of wellbeing and highly valued throughout the world. Health is not only the absence of illness, but capacity to develop a person's potential. Health is also an important determinant of economic growth. Given the importance of health, both as a source of human welfare and a determinant of overall economic growth, the Popular Health Insurance (Seguro Popular) was first introduced in Mexico as a pilot programme by the federal government in 2001, becoming part of the formal legislation in 2003. This study looks at the current situation, and some of the early findings and improvements made so far with regard to public health coverage in Mexico.
Topic:
Development, Economics, and Health
Political Geography:
Central America and Mexico

139. Development through Globalization?

Author:
Deepak Nayyar
Publication Date:
03-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper seeks to analyze the prospects for development in a changed international context, where globalization has diminished the policy space so essential for countries that are latecomers to development. The main theme is that, to use the available policy space for development, it is necessary to redesign strategies by introducing correctives and to rethink development by incorporating different perspectives, if development is to bring about an improvement in the well-being of people. In redesigning strategies, some obvious correctives emerge from an understanding of theory and a study of experience that recognizes not only the diversity but also the complexity of development. In rethinking development, it is imperative to recognize the importance of initial conditions, the significance of institutions, the relevance of politics in economics and the critical role of good governance. Even if difficult, there is also a clear need to create more policy space for national development, by reshaping the rules of the game in the world economy and contemplating some governance of globalization.
Topic:
International Relations, Development, Globalization, and Government

140. Innovations, High-Tech Trade and Industrial Development: Theory, Evidence and Policy

Author:
Lakhwinder Singh
Publication Date:
03-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Innovations spur science-based trade and industrial development in a fast changing pace of globalization. Knowledge accumulation and diffusion have been increasingly recognised as fundamental factors that play an important role in long-run economic growth. This paper focuses on the long-term innovation strategy of industrial and technological development in developing countries. Growth theory, empirical evidence and several indicators of innovation have been pressed into service to draw important lessons from historical experience of the developed and newly industrializing countries for the industrial development of the developing economies. Technology development and public technology policy experience of the East Asian countries have been examined to reinvent the role of public technology policy that can be adopted to develop national innovation system to nurture and build innovative capabilities in the developing economies in the dynamic global economy.
Topic:
Development, Economics, Industrial Policy, and International Trade and Finance
Political Geography:
East Asia

141. Decomposing Growth: Do Low-Income and HIPCs Differ from High-Income Countries? Growth, Technological Catch-up, Technological Change and Human and Physical Capital Deepening

Author:
Heli Virta and Pertti Haaparanta
Publication Date:
03-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper studies the distribution of output per worker between the years 1980 and 2000 in different country groups. The study uses data envelopment analysis (DEA) to decompose the changes in the distribution of labour productivity into changes in productive efficiency, changes in best practice technology, accumulation of physical capital, and accumulation of human capital. The study focuses on low-income countries and within them on highly indebted poor countries (HIPCs), which has not been possible in earlier studies.
Topic:
Civil Society, Development, Economics, and Science and Technology

142. Is Social Capital Part of the Institutions Continuum and is it a Deep Determinant of Development?

Author:
Stephen Knowles
Publication Date:
03-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
There is a growing literature which analyses, using cross-country data, whether institutions or geography is the most important deep determinant of economic development. The empirical proxies for institutions used in this literature focus on the definition of institutions, formal and informal. This study argues that the concept of informal institutions is similar to social capital. However, the social capital and 'institutions as a deep determinant' literatures rarely acknowledge the existence of the other. It is argued that social capital meets the criteria for being a deep determinant of development and that both the cross-country literature on social capital, and the deep determinants of development literature, could be enriched by empirically modelling social capital as a deep determinant of development.
Topic:
Civil Society, Development, and Economics

143. Applying Behavioural Economics to International Development Policy

Author:
Kostas Stamoulis and Leigh Anderson
Publication Date:
03-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Many development policies and programmes are premised on a traditional economic model of rationality to predict how individuals will respond to changes in incentives. Despite the emphasis of these programmes on poverty reduction, economists and the development community in general are still unable to fully understand how the poor make decisions, especially under uncertainty and over time. Individuals avail themselves less than predicted in health programmes, participate less than expected in market opportunities, under or over insure themselves, and make short-run decisions that are inconsistent with their long-run welfare. The rise and fall of different descriptive models and paradigms of poor household behaviour can partly be attributed to this limited understanding. More helpful answers may lay within behavioural economics, that these insights are particularly important for poor populations, and that they can improve the future design, implementation and subsequent effectiveness of development programmes. Behavioural economics is an approach that rigorously combines the insights of psychology and economics to try to better understand and predict human decision making. Empirical evidence is helping us learn, for example, how cognitive limitations, fairness, loss aversion, framing of choices, variable discount rates, and the qualitative dimensions of risk—such as proximity and control—affect decision making. The regularity of many of these anomalies suggests that these behaviours are anomalous only to traditional models, but that they may otherwise be the norm.
Topic:
Foreign Policy, Development, Economics, and International Cooperation

144. A Wider Approach to Aid Effectiveness: Correlated Impacts on Health, Wealth, Fertility and Education

Author:
Mark McGillivray, Sebastian Torres, and David Fielding
Publication Date:
02-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
In this paper we discuss the results of research into the impact of foreign aid on human development. Rather than focussing on per capita income, as is common in the existing literature, we look at how aid impacts on a range of human development indicators, including measures, of health, education and fertility, and allow for the fact that these different dimensions of wellbeing are likely to interact with each other. Overall, aid is found to have a substantial positive impact on many development outcome.
Topic:
Development, Economics, Health, and Humanitarian Aid

145. The Human Dimensions of the Global Development Process in the Early Part of the 21st Century: Critical Trends and New Challenges

Author:
Mihly Simai
Publication Date:
02-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
At the beginning of the twenty -first century there is a rare coincidence of profound transformations in a number of areas, in population dynamics, in human settlements, in science and technology, economics, social stratification, in the role and functions of the states and in the global power structure and in governance. The systemic transformation of the former socialist countries is an important component of the ongoing changes Political, economic, and social conditions vary immensely throughout the world, influenced by the size, natural endowments, development level, economic structure, political and institutional patterns, and competitiveness of the countries. The new state and non-state actors make the system of interests and values more diverse. All these have a major influence on the future of the global development process. The paper concludes that developing societies do not need old textbook models, neoliberal or other utopias. There is widespread demand for a new scientific thinking on development, with realistic and humanistic alternatives helping collaborative global and national actions.
Topic:
Development, Economics, Globalization, and Government

146. Institutions, Policies and Economic Development

Author:
Grzegorz W. Kolodko
Publication Date:
02-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Institutions are not only created and built, but al so, and especially, need to be learnt. It is a process which takes place in all economies, but acquires a special importance in less advanced countries. Not only theoretical arguments, but also the practical experience over the past 15 years demonstrates that faster economic growth, and hence also more broadly, socioeconomic development, is attained by those countries which take greater care to foster the institutional reinforcement of market economy. However, progress in market-economy institution building is not in itself sufficient to ensure sustained growth. Another indispensable component is an appropriately designed and implemented economic policy which must not confuse the means with the aims.
Topic:
Development, Economics, Globalization, and International Trade and Finance

147. Migration in the Development Studies Literature: Has It Come Out of Its Marginality?

Author:
Arjan de Hann
Publication Date:
02-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper explores the role migration has played in development studies, and in debates on economic growth and poverty. It argues that, despite a recent surge of interest in international migration and remittances, research on human mobility particularly for labour within poor countries does not have the place it deserves, and that it used to have in the classical development literature. Review of the empirical literature suggests that in fact much is known about the migration–development relationship, provided we are careful with definitions, and allow for context-specificity to be a key component of analyses. Against this richness of empirical detail, the paper reviews theoretical models of migration, finding significant differences in understandings of migration and its role in shaping wellbeing, but also complementarities. This highlights the importance of interdisciplinarity, and institutional understanding of processes of economic growth. In particular, it stresses that development economics need to draw more strongly on the insights by and approaches of non-economist social sciences.
Topic:
Development, Economics, Education, and Migration

148. Violence in Peace: Understanding Increased Violence in Early Post-Conflict Transitions and Its Implications for Development

Author:
Marcia Byrom Hartwell
Publication Date:
02-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
A key issue for development in the late twentieth and early twenty -first centuries has been an escalation of violence during post-conflict transitions. A long-term goal for international donor involvement is to assist in building legitimate and effective political, economic, and legal institutions. However, research and observation has revealed that increased violence is commonplace during peace processes and strongly influences the ways in which these institutions are formed. In turn post-conflict violence itself is strongly influenced and motivated by the way in which peace agreements have been negotiated. This study addresses some of the reasons for escalation of violence following peace agreements. It describes the underlying dynamics including the relationship between perceptions of justice as fairness, formation of post-conflict identity, political processes of forgiveness and revenge; and the policy implications for development particularly in relation to peace conditionality tied to aid.
Topic:
Conflict Prevention, Development, International Trade and Finance, and Peace Studies

149. Credit Co-operatives in Locally Financed Economic Development: Using Energy Efficiency as a Lever

Author:
Robert J. McIntyre
Publication Date:
02-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
In most transitional and many developing countries institutions capable of supporting economic development with localized saving-investment cycles have not developed. This crucial gap is in no way addressed by either country-level macro programmes dealing with 'development finance' or by donor-driven 'micro credit' schemes of Grameen and other types operating at a lower (local) level. The latter seldom evolve into financial institutions able to sustain themselves on the basis of local resources, do not operate on a sufficient scale to trigger dynamic local-level economic growth, and are ultimately artificial manifestations of concessional or charitable aid. The advantages of credit co-operatives in mobilizing and financing local economic development a contrasted with the disadvantages of both conventional micro credit and the most recent neoliberal fashion of so-called 'new wave financial institutions'. Both precedent and the structural logic suggest that this is a promising space for the development of a localized financial system based on credit co-operatives, which elsewhere have overcome the SME credit famine and stimulated local saving-investment cycles. Recent Russian developments are placed in the context of earlier experience in structurally similar conditions. These lessons apply to all other former Soviet Union states, as well as other countries.
Topic:
Development, Economics, Humanitarian Aid, and Third World
Political Geography:
Russia

150. Patterns of Rent-Extraction and Deployment in Developing Countries: Implications for Governance, Economic Policy and Performance

Author:
Richard M. Auty
Publication Date:
02-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Rents tend to be relatively high in developing countries and also very fungible, so that differences in the scale of the rent and in its distribution among economic agents profoundly affect the nature of the political state and the development trajectory. This paper identifies two basic trajectories to a high-income democracy linked to the scale and deployment of rents. Low-rent countries tend to engender developmental political states that competitively diversify the economy and sustain rapid per capita GDP (PCGDP) growth, which strengthens three key sanctions against anti-social governance (political accountability, social capital and the rule of law) to achieve endogenous democratization that is incremental. In contrast, rent-rich countries are likely to experience a slower and more erratic transition. This is because high rents tend to nurture non-developmental (predatory) politic al states whose deployment of the rent locks the economy into a staple trap, which carries a high risk of a growth collapse. The events presaging a growth collapse weaken sanctions against anti-social governance. However, a growth collapse may abruptly trigger democracy if exogenous factors are favourable, although such a change is likely to prove unstable and prone to regression. Very preliminary tests of the link between PCGDP growth and sanctions against anti- social governance suggest that social capital and law strengthen as predicted by the models for low-rent countries, but political accountability lags. Rent-rich countries exhibit the expected weaker link between PCGDP growth and democratization, an outcome consistent with a more erratic transition towards a high-income democracy.
Topic:
Development, Economics, Politics, and Third World