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31. Reigniting labour productivity growth in developing countries: Do structural reforms matter?

Author:
Kwamivi Gomado
Publication Date:
08-2022
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
While the negative effects of the 2008 global financial crisis on labour productivity are still fresh in people’s minds, the COVID-19 pandemic raises concerns that productivity will continue to decline. To boost labour productivity and regain economic performance, there is an empirical consensus on the role of structural reforms that allows an efficient reallocation of resources such as labour by reducing rigidities in markets. This study analyses the role of certain structural reforms in improving labour productivity in 35 developing countries over the period of 1990–2014. From the local projection method, our results show that structural reforms have a positive impact on productivity growth in the short and medium terms. The results also illustrate that reforms induce an efficient reallocation of resources within but not between sectors. Taking the business cycle into account in estimates shows that structural reforms stimulate labour productivity growth better in periods of low economic growth.
Topic:
Labor Issues, Financial Crisis, Reform, Business, Economic Growth, and Productivity
Political Geography:
Global Focus

32. Unlocking the Power of Reformers to Achieve Better Progress on Extractives Governance

Author:
Columbia Centre on Sustainable Investment
Publication Date:
01-2022
Content Type:
Policy Brief
Institution:
Columbia Center on Sustainable Investment
Abstract:
This project arose out of conversations over the past few years between CCSI staff and high-level officials in extractive industry (EI) ministries in Africa, the Cauca- sus, and Latin America. After describing the need for an array of genuine reforms in the governance of their re- spective countries’ energy and mining sectors, these of- ficials expressed their frustration at the resistance they encountered from within their own government when pushing for reform. These pressures come from above and below.
Topic:
Politics, Governance, Reform, Sustainability, and Progressivism
Political Geography:
Global Focus

33. A Simple Theory of Economic Development at the Extensive Industry Margin

Author:
Dario Diodato, Ricardo Hausmann, and Ulrich Schetter
Publication Date:
09-2022
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
We revisit the well-known fact that richer countries tend to produce a larger variety of goods and analyze economic development through (export) diversifcation. We show that countries are more likely to enter ‘nearby’ industries, i.e., industries that require fewer new occupations. To rationalize this fnding, we develop a small open economy (SOE) model of economic development at the extensive industry margin. In our model, industries difer in their input requirements of non-tradeable occupations or tasks. The SOE grows if proft maximizing frms decide to enter new, more advanced industries, which requires training workers in all occupations that are new to the economy. As a consequence, the SOE is more likely to enter nearby industries in line with our motivating fact. We provide indirect evidence in support of our main mechanism and then discuss implications: We show that there may be multiple equilibria along the development path, with some equilibria leading on a pathway to prosperity while others resulting in an income trap, and discuss implications for industrial policy. We fnally show that the rise of China has a non-monotonic efect on the growth prospects of other developing countries, and provide suggestive evidence for this theoretical prediction.
Topic:
Industrial Policy, Poverty, Reform, Economy, Diversification, Exports, and Convergence
Political Geography:
Global Focus

34. New Rules, Same Practice? Analysing UN Development System Reform Effects at the Country Level

Author:
Silke Weinlich, Max Otto Baumann, Maria Cassens-Sasse, Rebecca Hadank-Rauch, Franziska Leibbrandt, Marie Pardey, Manuel Simon, and Anina Strey
Publication Date:
01-2022
Content Type:
Working Paper
Institution:
German Institute of Development and Sustainability (IDOS)
Abstract:
With its unique multilateral assets, the United Nations Development System (UNDS) should be playing a key role in assisting governments and other stakeholders with their implementation of the 2030 Agenda for Sustainable Development. But this requires change. Despite improvements in recent decades, too often the UNDS has continued to act as a loose assemblage of competing entities, undermining its effective support for Sustainable Development Goal (SDG) implementation. It is against that backdrop that the UNDS has been undergoing an extensive reform – that was decided on in 2018 and has been implemented since 2019 – to provide more coherent, integrated support in line with requirements of the 2030 Agenda to United Nations (UN) programme countries. What effects have the reforms yielded at the country level? This paper presents the main findings, conclusions and recommendations from our research on UNDS reform implementation. It does so with a focus on reform-induced changes towards what we call a strengthened, collective offer at the country level. Overall, our research shows that reform implementation is moving the needle on the quality of the collective offer. In particular, with regard to its institutional element, we observed that the reform has fostered change in how UN country teams work together that is in line with what the 2030 Agenda demands. Institutional changes allow for increased cross-organisational and cross-sectoral coordination, which could potentially lead to increased policy coherence. But while we see substantial progress, it remains incomplete, fragile and subject to structural limitations. A more critical picture emerges with regard to change in the substantive component of the collective offer in the areas of SDG integration, cross-border work and normative approaches. While there were positive examples, we found little evidence of a systematic repositioning in these areas. The adjustment of the UNDS to the 2030 Agenda does not (yet) meet the expectations derived from the UN’s own reform ambition.
Topic:
Development, United Nations, Reform, and Sustainable Development Goals
Political Geography:
Global Focus

35. Inequality Can Only Be Fixed By Structural Economic Reform

Author:
Graeme Maxton
Publication Date:
03-2022
Content Type:
Journal Article
Journal:
Brown Journal of World Affairs
Institution:
Brown Journal of World Affairs
Abstract:
Inequality is like a slippery eel: it is easy to see but very hard to grasp. It has endured for centuries and has worsened recently.1 As a result of climate change, it is likely to become more of a problem in the future, bringing the risk of widespread instability. Although inequality has been a problem for a very long time, economists, social scientists, and political thinkers have failed to devise any lasting solutions. This is because the responses so far have been tepid-hearted, torn between three competing ideas.
Topic:
Reform, Inequality, and Economy
Political Geography:
Global Focus

36. Closing Pandora’s Box: How to Improve the Common Reporting Standard

Author:
Menusch Khadjavi and Marjolein Vertelman
Publication Date:
05-2022
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
The 2021 pandora papers show that many wealthy individuals and even politicians use shell companies to hide their fortunes. In order to fight international personal tax evasion, the Common Reporting Standard (CRS) was implemented and it helped governments to collect USD 85 billion already. USD 182 billion are still missing from the government budget because of personal tax evasion. The individual implementation strategies of CRS compliant countries can endanger the effectiveness of the Automatic Exchange of Information (AEOI). Several loopholes are used to circumvent the CRS. There are amendments possible which increase the effectiveness by improving the implementation strategies and closing the loopholes. The enforcement of the CRS should become stricter by removing financial institutions’ licenses to operate in cases of non-compliance. Beneficial ownership registers should increase transparency regarding investments and securities. Within the current momentum of international tax legislation, the CRS compliant countries may leverage the USA into signing the CRS as well. The USA could in turn demand a more effective CRS before signing it.
Topic:
Reform, Finance, Business, and Wealth
Political Geography:
Global Focus

37. Innovations in Donor Bureaucracies and the Implications for Peacebuilding Financing

Author:
Ed Laws
Publication Date:
04-2022
Content Type:
Policy Brief
Institution:
Center on International Cooperation (CIC)
Abstract:
Donors face increasing pressure to do more with less, even in the most fragile contexts. This policy brief analyzes how organizational factors within governments create obstacles for good peacebuilding financing—and proposes options for overcoming them.
Topic:
Reform, Finance, Bureaucracy, Donors, and Peacebuilding
Political Geography:
United Kingdom, Europe, and Global Focus

38. UN-IFI Cooperation during Peacekeeping Drawdowns: Opportunities for Mutual Support

Author:
Paige Arthur
Publication Date:
03-2021
Content Type:
Policy Brief
Institution:
Center on International Cooperation (CIC)
Abstract:
As increasing political and budgetary pressures have come to bear on UN peace operations in recent years, more attention has been paid to ensuring that drawdowns are undertaken in a way that sustains the gains of a mission’s presence. This policy briefing highlights a number of missed opportunities and argues for greater collaboration between the UN, the World Bank, and the International Monetary Fund (IMF) ahead of a mission’s departure to build greater synergies between the country’s political and economic pathways. The brief begins by summarizing the economic challenges related to UN transitions, including diving deeper into the debate on whether or not these transitions create a “financial cliff”—in particular, in relation to official development assistance and foreign direct investment. We then describe three key opportunities for the UN, the Bank, and the IMF to leverage their respective mandates and comparative advantages during mission drawdowns, seizing the moment around transitions to support a country’s pathway to peace in ways that also lessen its economic burdens and supports key reforms. These opportunities include: Generating better alignment and planning between the three institutions in transition moments, with a focus on maintaining and strengthening peacebuilding gains while also seeking to unlock broader economic opportunities; Collaborating across areas of expertise to assess budgetary and resourcing gaps that may prove crippling to a country’s emergence from fragility, if not addressed; Activating levers for additional peacebuilding financing and to support reform, from the UN’s PBC and multi-partner trust funds, to IMF support to improve access to financial markets, to the sensitive use of the World Bank’s new FCV envelopes in IDA19 . The brief is based on desk research as well as interviews with a small number UN, World Bank, and IMF representatives involved in the transition process in Timor-Leste, Côte d’Ivoire, and Liberia, as well as the expected transition in the Democratic Republic of the Congo.
Topic:
Politics, United Nations, Reform, Multilateralism, Peace, and IMF
Political Geography:
Global Focus

39. How can we work towards economic recovery for all? Financing for Development: the issues, challenges, and opportunities in 2021

Author:
Sarah Cliffe, Karina Gerlach, and Leah Zamore
Publication Date:
04-2021
Content Type:
Commentary and Analysis
Institution:
Center on International Cooperation (CIC)
Abstract:
2021, we all hope, will be the year of recovery. If COVID-19 vaccines are rolled out at scale, including in the developing world, global economic recovery will be large. But that in itself ensures neither that all countries will be included in the recovery, nor that all people within each country will see the gains. A rising tide, as we have seen only too well since US president John F. Kennedy first used the phrase in 1963, does not lift all boats. Elsewhere, CIC has analyzed the high demand for transformative policies in high- and low-income countries alike since the COVID-19 crisis began, including policies for domestic action on inequality and socioeconomic exclusion. This piece takes a more global view and considers how to ensure that all countries benefit, and examines the issues, challenges, and opportunities in financing for development. It looks first at the key political messages that explain why 2021 should be a year of urgent, ambitious global action for shared economic recovery; secondly at the measures under discussion (which are expanded in an annex); thirdly at the political interests at play; and fourthly at foreseeable scenarios for agreement. Last, we outline the calendar of relevant policy meetings this year and the challenge of orchestrating progress between them.
Topic:
Governance, Reform, Finance, Multilateralism, and COVID-19
Political Geography:
Global Focus

40. It’s Time to Go Back to Basics of Governance

Author:
Nanjala Nyabola
Publication Date:
07-2021
Content Type:
Commentary and Analysis
Institution:
Center on International Cooperation (CIC)
Abstract:
The COVID-19 pandemic is an opportunity to re-evaluate the principles or ideas that are at the heart of theories of government, that is the fundamentals of governance and public theory. What is government for, but also what should government do and how. Engaging with the crucial philosophical questions of governance is integral to building back better: going back to basics is a major step in figuring out how to prevent mistakes from happening again. The social contract is one such principle: the idea of a social contract is central to answering the question of what governments are for: explaining why people obey laws, providing answers to why we live in societies, and why we abide by social rules and norms. Recognizing the ongoing debates, national and international, around the meaning and origins of the term social contract, this paper by Nanjala Nyabola tries to point to some of the important thinking from the south and from non-western sources and traditions that have helped shape modern understanding of social contract theory. It is not intended to be a comprehensive review, in such a short paper, but rather a selection that reflects the richness and variety of such sources and how they have impacted thinking throughout the ages. Overall, looking at ideas of social contracts outside Western philosophical tradition reminds us that it is not just about the form of the social contract or that all political organizations must be identical. These theories also remind us that compulsion and punishment are not a strong foundation for strong systems of governance. We have to create societies that people want to live in.
Topic:
Security, Governance, Reform, Fragile States, and Multilateralism
Political Geography:
Global Focus