PSD Blog - The World Bank Group

Arvind Subramanian on Jagdish Bhagwati

The Division Chief of the IMF’s Research Department has done an eloquent and excellent profile of the famous trade theorist and Nobel hopeful. His initial introduction kicks off with:

…both theoretician and policy wonk, wielding a deft pen and moving easily between the ivory tower, op-ed pages, and corridors of influence. You have to stop and notice a man who tries to score a point on the merits of free trade by invoking a Balzac novella.

Low-cost, high-impact technology: the Simputer

Vivek heads to college on his Yamaha motorbike with a frown. Upcoming exams are not his concern - it is a hand-held gadget the traffic police have started using.

Bangalore...is the first city in India to be given the Simputer to fine traffic offenders. Described as "the people's computer" for its affordable price and ease of use, this paperback-sized console can fine traffic violators even for previous offences.

Via the BBC; catching dangerous drivers is surely only the start for the Simputer. (Sim stands for Simple, Inexpensive and Multilingual.)

How to increase aid effectiveness?

The U.K.’s DFID and the finance ministers of Burkina Faso and Tanzania were recently asked how they would increase aid effectiveness.

DFID favors greater country ownership:

…the most promising path to better aid is a “country-led” approach, in which governments of developing countries themselves define and lead the poverty reduction agenda.

Mr. Comparé (Burkina Faso) believes strengthening capacity is key:

The main difficulty… is persistently low absorption capacity for externally finance projects, with only about 70 percent of money committed by donors getting effectively disbursed.

While Mr. Mramba (Tanzania) touts ‘smart’ partnerships that:

…better coordinate and harmonize [donor] support and align it with national priorities and government systems and procedures.

For a summary of the many issues involved see Peter Heller on Making Aid Work or this World Bank reading list.

2005 Commitment to Development Index

The Center for Global Development has released the 2005 version of their popular index. The index ranks the world’s 21 richest nations in terms of their aid, trade, investment, migration, security, environment and technology policies.

Let them know what you think or go to the launch. See also this great interactive feature courtesy of MappingWorlds. (Click on 'rescale.')

Update: see the summary article in Foreign Policy.

Dani Rodrik on the 'trade-and-aid myth'

Domestic efforts trump everything else in determining a country’s economic fortunes… What matters most is whether a country adopts the right growth strategy… It is far from clear that expanding market access and increasing aid are the most productive use of valuable political capital in the North. Development should focus not on trade and aid, but on improving the policy environment in poor countries.

He also suggests that rich countries should focus on pressuring corrupt dictators, increasing worker mobility and relaxing WTO and conditionality rules. Comments are open!

Private health insurance for the poor

Development countries bear over 90% of the world’s disease burden. The OECD DevCentre offer’s their policy insight on how private health insurance can help lighten this oppressive weight:

Private for-profit and not-for profit schemes are emerging… [as] a potential improvement in risk sharing for a larger part of the population… In particular non-profit group-based insurance schemes could become an important pillar of the health-financing system.

The demand is definitely there. As Tyler Cowen points out, some of Africa’s neglected poor have resorted to developing their own safety nets.

For more, see the new PSP-One site or this World Bank reading list.

Fighting corruption: hospital extortion

The New York Times reports on a disturbing practice in Indian hospitals:

Just as the painful ordeal of childbirth finally ended and Nesam Velankanni waited for a nurse to lay her squalling newborn on her chest, the maternity hospital's ritual of extortion began. Before she even glimpsed her baby, she said, a nurse whisked the infant away and an attendant demanded a bribe. If you want to see your child, families are told, the price is $12 for a boy and $7 for a girl.

The article goes on to highlight other forms of petty bribery and how their impact is often overshadowed by the attention given to the bank accounts of corrupt politicians and CEOs.

Industry risks, and how to mitigate

MIGA has published a new series of briefs outlining the investment challenges in 10 different global sectors. Each brief not only outlines the portfolio and the risk mitigation services that MIGA offers, they also provide a practical and concise summary of the main challenges potential investors face.

Here they are: agribusiness, issuing securities, manufacturing, mining, oil and gas, power projects, tourism and hospitality, transportation, water and sanitation and a water Q&A.

For more on global retailing, see the recently released AT Kearney Global Retail Development Index.

Deregulating electricity markets

Nobel Laureate Vernon Smith writes in the Wall Street Journal to advocate vertical separation for the US electricity industry, to prevent the monopolistic wires business from sitting on potential competition elsewhere in the supply chain.

From Marginal Revolution. Browse World Bank resources on utility regulation.

LifeStraw: invention of the century?

The aptly-named LifeStraw... is a personal, low-cost water purification tool with a life time of 700 litres - approximately one year of water consumption for one person... that could become one of the greatest life-savers in history. It is a 25 cm long, 29 mm diameter, plastic pipe filter and purchased singly, costs around US2.00. (source)

Clean water for a year for just two bucks? -  sounds good to me! WorldChanging provides a good summary of the product, though I don’t understand why the promotional pictures have people kneeling down and drinking directly from riverbeds instead of from cups or bowls. Seems like this simple step could drastically increase the effectiveness and life of the product.