Frontiers in Development Policy: A Primer on Emerging Issues

✍ Scribed by Raj Nallari, Shahid Yusuf, Breda Griffith, Rwitwika Bhattacharya

• Publisher: World Bank Publications
• Year: 2011
• Tongue: English
• Leaves: 316
• Category: Library

✦ Synopsis

Frontiers in Development Policy, developed for courses at the World Bank and elsewhere, is a primer that examines interlinkages in various parts of the economy and the need for practical policy making to reach development goals in a globalized world of instabilities and complexities. The global crisis of 2008 09 opened new discussions about a plethora of economic and policy issues as well as basic concepts, frameworks, and forms of evaluation. What is development? What are the roles of political economy and institutions? How are private and public sectors balanced in the economy? How can economies best achieve structural transformation while ensuring human development and managing growing risks and crises in a rapidly changing world? The policy issues in this primer were selected because of their importance to promote strong, sustainable, and inclusive growth in low-income and middle-income developing countries; and because they are new and emerging and necessitate debate among policy makers and practitioners. The book is divided into five parts. Part 1 clarifies basic concepts in development policy, discusses the challenges of low- and middle-income developing countries, and suggests frameworks for analysis. Part 2 moves from the macroeconomic to the microeconomic; it focuses on the private sector as the engine for growth and is balanced with softer issues of the need for trust, accountability, and corporate social responsibility. Part 3 examines growing consensus on the need to balance the public and private sectors roles in the structural transformation of an economy. It also discusses newer thinking on industrial policy and public-private partnerships in infrastructure. Part 4 discusses human development policies in emerging topics-such as education quality and investment in early childhood development, health, and nutrition-and the roles of the state and the private sector. Finally, Part 5 looks at issues of global shocks and risks as well as systems and institutions that need to be in place to manage such risks-including climate change and financial crises-and new thinking on social protection and insurance to mitigate adverse shocks. This primer has been used by leading policy experts around the world and is intended for policy makers, practitioners-particularly government sector officials-and researchers from NGOs and think tanks interested in international development policy and marketing trends.

✦ Table of Contents

CONTENTS......Page 7
Preface......Page 13
About the Authors......Page 15
Abbreviations......Page 16
PART I. DEVELOPMENT CHALLENGES IN A POSTCRISIS WORLD......Page 17
Section 1. Overview......Page 19
Section 2. What Is Development?......Page 25
Section 3. Poverty Traps and the MDGs......Page 41
Section 4. Middle-Income Trap......Page 55
Section 5. Pathways to Development......Page 61
Section 6. Why Is Development Blocked?......Page 71
Section 7. Development Challenges......Page 77
Section 8. Political Economy......Page 83
PART II. PRIVATE ENTERPRISE AND DEVELOPMENT......Page 87
Section 9. Overview......Page 89
Section 10. Firms Are the Prime Movers......Page 95
Section 11. Industrial Mix, Research Intensity, and Innovation by Firms......Page 103
Section 12. Investing in Technology and Human Capital: An Example from Asia......Page 111
Section 13. Impact of Regulation on Growth and Informality......Page 121
Section 14. Private Sector Regulation and Financial Regulation......Page 127
PART III. GROWTH AND DEVELOPMENT STRATEGIES AND RETHINKING DEVELOPMENT......Page 131
Section 15. Overview......Page 133
Section 16. Why Is Growth Higher in Some Countries?......Page 141
Section 17. The Role for State Intervention......Page 147
Section 18. Private Participation in Infrastructure......Page 151
Section 19. Changing Development Paradigms......Page 159
Section 20. Aid Effectiveness......Page 167
Section 21. Enhancing Competitiveness......Page 175
Section 22. Land Policy and Effective Use of Natural Resources......Page 181
Section 23. Cities as Engines of Growth......Page 187
Section 24. Rethinking Macroeconomic Theory......Page 195
Section 25. Macro-Fiscal-Monetary Policies......Page 201
Section 26. Fiscal Activism......Page 209
Section 27. Fiscal Multipliers......Page 217
Section 28. Preventing Future Credit Bubbles......Page 221
Section 29. Revisiting Exchange Rate Regimes......Page 225
Section 30. Reexamining Trade Policy......Page 229
PART IV. HUMAN DEVELOPMENT POLICIES......Page 233
Section 31. Overview......Page 235
Section 32. Early Childhood Development: The First Thousand Days Are Most Important......Page 237
Section 33. Education Access and Quality: What We Know and Don’t Know......Page 241
Section 34. Health Care Policy......Page 247
Section 35. Labor Market Trends......Page 251
Section 36. Labor Market Policies......Page 263
PART V. MANAGING RISKS......Page 271
Section 37. Overview......Page 273
Section 38. Managing the Climate Crisis......Page 275
Section 39. The Role of Macroprudential Regulations......Page 279
Section 40. Managing Capital Flows......Page 285
Section 41. Triple Crisis: Rising Food Prices, Global Financial Crisis, and Climate Change Issues......Page 293
Section 42. Catastrophes and Economic Growth......Page 299
Index......Page 303
2.1 Income and Happiness, 1980s and 1990s......Page 34
2.2 Income and Happiness in the United States......Page 35
2.3 Relationship between Well-Being and Income within Individual Countries, Gallup World Poll, 2002......Page 36
2.4 Happiness and GDP, World Values Survey, 1999–2004......Page 37
3.1 Per Capita GDP Growth Rates, by Country Group, 2003–07......Page 45
3.2 Poverty Rates in Sub-Saharan Africa, South Asia, and East Asia and Pacific, 1981–2005......Page 46
3.3 Gender Parity in Primary Education, 1991 and 2007......Page 47
3.4 Ratio of Employment to Population, Men and Women, 1991 and 2007......Page 49
4.1 Middle-Income Trap......Page 56
4.2 Global Competitiveness Indexes......Page 57
5.1 Sources of Economic Growth, by Region......Page 64
6.1 Regional Growth Poles......Page 72
7.1 Monthly Price Indexes, 2005–09......Page 79
7.2 Development Is No Longer Just North-South......Page 80
9.1 Scientific Innovation: Penetration of New Technologies......Page 91
11.1 R&D Intensity, by Industry, in 10 OECD Countries......Page 105
11.2 Share of U.S. Patents, by Industry, 2006......Page 106
12.2 Composition of R&D Spending, by Type of Organization......Page 113
12.2 Royalty and License Fee Receipts, 1995–2006......Page 114
13.1 Regulation and GDP Per Capita......Page 122
13.2 Informal Economy across Several Countries and Sectors......Page 124
14.1 Average Per Capita GDP Growth and Ease of Doing Business, 2000–05......Page 128
16.1 GDP Percentage and Investment Rates, by Growth in 13 Economies, 1971–2004......Page 143
18.1 Totals of Infrastructure Projects and Investments, Low- and Middle-Income Developing Economies, 1990–2010......Page 152
18.2 Investment Commitments to Infrastructure Projects with Private Participation in Developing Countries, by Sector, 1990–2009......Page 154
18.3 Investment Commitments to Infrastructure Projects with Private Participation in Developing Countries, by Region, 1990–2009......Page 156
19.1 Flows of FDI, Remittances, and Official Development Assistance to Developing Countries, 1980–2007......Page 161
20.1 Progress Toward the 2010 Paris Declaration Targets......Page 170
22.1 Initial Land Distribution and Growth, by Economy, 1960–2000......Page 182
26.1 Balancing the Fiscal Options......Page 214
1.1 Global Output......Page 20
1.2 Net Financial Flows, 2007–10......Page 22
2.1 Alternative Measures of GDP......Page 27
3.1 Testing the Poverty Trap for Long Periods......Page 42
3.2 Selected MDGs......Page 44
5.1 Contribution to World Growth Percentage Share......Page 63
9.2 Boston Consulting Group/National Association of Manufacturers’ Global Innovation Index, 2009......Page 92
10.1 Major Innovations by Small U.S. Firms in the 20th Century......Page 98
12.1 R&D Spending, by Country, Selected Years, 1996–2006......Page 112
12.3 Number of Patents Granted to East Asian Economies by the USPTO, 1992, 2000, and 2008......Page 115
12.4 Eighth-Grade TIMSS Scores for Science and Mathematics, Selected East Asian Economies, 1999, 2003, and 2007......Page 116
12.5 Percentage of First University Degrees in Science and Engineering......Page 117
16.1 Success Stories of Sustained High Growth......Page 142
18.2 Risk Mitigation Instruments......Page 153
18.3 PPI Project Pipeline in Developing Countries, by Sector and Project Status, January 2008–March 2010......Page 155
20.1 Measures to Achieve Aid Effectiveness......Page 168
22.1 Characteristics of Property Rights for Land......Page 184
23.1 Business Friendliness......Page 189
27.1 Spending Multipliers of the United States and Other Country Groups......Page 219
35.1 Labor Supply Trends, by Region......Page 252
35.2 World Merchandise Imports and Exports, by Region, 2008–09......Page 253
35.3 Female and Male Labor Force Participation, by Region, 2007 and 2009......Page 254
35.4 Unemployment Rates for Both Sexes, by Region, Selected Years 1999–2009......Page 255
35.5 Youth Unemployment Rates, by Region, Selected Years, 1999–2009......Page 257
36.1 MILES framework......Page 264
40.1 Net International Capital Flows to Developing Countries, 2005–10......Page 286