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111. The Commitment to Reducing Inequality Index 2022

Author:
Jo Walker, Matthew Martin, Emma Seery, Nabil Abdo, Anthony Kamande, and Max Lawson
Publication Date:
10-2022
Content Type:
Research Paper
Institution:
Oxfam Publishing
Abstract:
The 2022 Commitment to Reducing Inequality (CRI) Index is the first detailed analysis published looking at governments’ policies and actions to fight inequality during the first two years of the pandemic. This fourth edition of the CRI Index reviews the spending, tax and labour policies and actions of 161 governments during 2020–2022. COVID-19 has increased inequality worldwide, as the poorest people were hit hardest by both the disease and its profound economic impacts. Yet the CRI 2022 Index shows clearly that most of the world’s governments failed to mitigate this dangerous rise in inequality. Despite the biggest global health emergency in a century, half of low-and lower-middle-income countries saw the share of health spending fall during the pandemic, half of the countries tracked by the CRI Index cut the share of social protection spending, 70% cut the share of education spending, while two-thirds of countries failed to increase their minimum wage in line with gross domestic product (GDP). Ninety-five percent of countries failed to increase taxation of the richest people and corporations. At the same time, a small group of governments from across the world bucked this trend, taking clear actions to combat inequality, putting the rest of the world to shame.
Topic:
GDP, Inequality, Tax Systems, Pandemic, and COVID-19
Political Geography:
Global Focus

112. Our climate future depends on conflict dynamics in Congo

Author:
Peer Schouten, Judith Verweijen, and Fergus Simpson
Publication Date:
11-2022
Content Type:
Policy Brief
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
The Congo Basin rainforest – the second largest on earth – absorbs four percent of global CO2 emissions and constitutes a crucial line of defense against cataclysmic climate change. However, a complex mix of illegal resource exploitation and conflict is currently threatening the rainforest. To curb these threats and their global consequenses, we need to understand the interplay between resources, conflict and environmental protection in Congo.
Topic:
Agriculture, Climate Change, Development, Environment, Poverty, Food, Non State Actors, Armed Forces, Inequality, Fragile States, Violence, Police, and Justice
Political Geography:
Africa and Democratic Republic of the Congo

113. Characterisation of Danish agricultural investments in Tanzania and Uganda

Author:
Rikke Broegaard, Helle Monk Ravnborg, Evelyne Lazaro, Teddy Nakanwagi, and David Tumusiime
Publication Date:
08-2022
Content Type:
Working Paper
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
This DIIS Working Paper presents key characteristics of each of the six cases including main crop focus, size and business model, as well as types of investors, their investment approach and the factors that motivate them. It also presents the different objectives that the investors have expressed wanting to achieve. As most of the investments involve private funds, it is reasonable to expect that one important goal is to ensure a viable economy in the investment. However, in addition to an economically sound investment, all of the investors behind these six cases have ambitions regarding ways in which they see themselves - through the investment - as contributors towards a positive societal development in the area of the investment. Thus, the paper presents the different ways the investors see their investments contributing to development in the area. The paper is based on interviews with the investors and field work in the areas of investments.
Topic:
Agriculture, Development, Environment, Poverty, Natural Resources, Food, Inequality, Investment, and Land Rights
Political Geography:
Europe, Denmark, Tanzania, and Africa

114. How renewable energy transitions impact power structures in local communities

Author:
Maria-Louise Clausen
Publication Date:
03-2022
Content Type:
Policy Brief
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
International donors often see renewable energy transitions in fragile and conflict-affected states as a building block for peace and development. But donor-supported transitions to small-scale renewable energy generation can both mitigate and exacerbate local conflict dynamics and undermine the central state. In fragile and conflict-affected states, it is often difficult for the central authorities to protect large-scale energy infrastructure from attacks and sabotage, and thus guarantee long-term stability. Moreover, local communities often use fuel-driven generators to supplement the state-driven national grid, but national diesel supply lines are also vulnerable to disruptions. Consequently, international donors increasingly support small-scale renewable energy generation as a climate friendly alternative to centralised and state-led energy generation. Solar photovoltaic (PV) in particular has become a widely promoted, affordable and accessible technology for local energy generation.
Topic:
Security, Climate Change, Development, Water, Non State Actors, Governance, Inequality, Renewable Energy, and Energy Transition
Political Geography:
Global Focus

115. Economic and Social Impacts of FDI in Central, East and Southeast Europe

Author:
Doris Hanzl-Weiss and Branimir Jovanovic
Publication Date:
11-2022
Content Type:
Special Report
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
This study assesses the economic and social impacts of foreign direct investment (FDI) in 17 economies in Central, East and Southeast Europe (CESEE). More precisely, we investigate how different FDI inflows have affected various economic and social indicators, such as GDP growth, labour market outcomes, and poverty and inequality, for the period since the fall of communism until 2020. We pay particular attention to FDI that originates from the EU, as well as FDI from Germany and Austria, in order to evaluate whether their effects are different from the effects of FDI from other places of origin. We also examine whether there are differences in the impacts of different types of FDI – equity capital, reinvested earnings and intra-company debt, as well as of FDI that goes to different sectors of the economy – the primary, secondary and tertiary sectors. We find that FDI inflows have had, in general, a positive effect on economic growth in CESEE, and that this effect has been particularly strong for German and Austrian FDI. For total FDI, higher inflows of 1 percentage point (pp) of GDP are associated with 0.19 pp higher GDP growth. For FDI from Germany and Austria, this effect is five times higher – FDI inflows of 1 pp of GDP have led to 0.9 pp higher GDP growth. The positive GDP effects have come from the higher consumption and exports that the FDI has induced. FDI inflows have also reduced unemployment and increased wages, but have had no effects on labour productivity. Total FDI has had only limited effects on inequality and poverty, but FDI from Germany and Austria has been found to reduce both inequality and poverty, likely because they have benefitted mainly lower-income persons. There are differences in the effects of the different types of FDI, with reinvested earnings and equity capital having in general more beneficial effects than intra-company loans. Also, FDI in different sectors of the economy has had different effects, with inflows to the secondary and tertiary sectors having greater effects than inflows to the primary sector. The policy implications of these results are that CESEE economies should not give up on their efforts to attract more FDI, but also that their endeavours should be more targeted, focusing on investments that have greater economic and social impacts. Moreover, foreign investment should not be criticised for the perhaps unsatisfactory economic and social performances of the economies from this region. Instead, the reasons for this should be sought in domestic factors and in the modest growth of the European Union during the past two decades.
Topic:
Development, International Trade and Finance, Poverty, Foreign Direct Investment, Inequality, Economic Growth, and Unemployment
Political Geography:
Europe, Eastern Europe, Germany, and Austria

116. Ten Recommendations for Germany’s Feminist Development Policy

Author:
Ina Friesen and Alma Wisskirchen
Publication Date:
01-2022
Content Type:
Working Paper
Institution:
German Institute of Development and Sustainability (IDOS)
Abstract:
In early 2022, Germany’s development minister Svenja Schulze announced the adoption of a feminist development policy. With this announcement, Germany joins a growing group of governments that have adopted or declared the adoption of an explicitly feminist perspective in their external policies. Drawing on these governments’ policies and the observations and recommendations by civil society and researchers, this Discussion Paper outlines ten key recommendations for Germany’s first feminist development policy. The first three recommendations focus on the conceptual foundation of the policy and lay out the importance of 1) an inclusive definition of gender, 2) a clarification of the feminist approach and the policy’s overall goal as well as 3) the need for an intersectional approach. The second set of recommendations concerns the implementation of the policy and stresses the importance of 4) a permanent cooperation with gender-focused and feminist organisations and 5) the necessity to increase funding for gender-related objectives in general and 6) for feminist organisations in particular. Further recommendations include 7) widening the range of sectors that target gender equality through a transformative approach and context-sensitive programming and by providing mechanisms to monitor and evaluate the implementation of the strategy’s goals, objectives and activities. The last three recommendations emphasise institutional aspects and the importance of 8) creating an institutional environment that best supports gender equality within the development ministry and its main implementing organisations, 9) the necessity of a coherent feminist approach between the different ministries, and 10) the importance of addressing possible challenges the ministry might face in the implementation of its feminist development policy.
Topic:
Development, Inequality, Feminism, and Gender
Political Geography:
Europe and Germany

117. Inequality and Social Cohesion in Africa: Theoretical Insights and an Exploratory Empirical Investigation

Author:
Francesco Burchi and Gabriela Zapata-Román
Publication Date:
01-2022
Content Type:
Working Paper
Institution:
German Institute of Development and Sustainability (IDOS)
Abstract:
Inequality is bad per se and has adverse effects, among other things, on economic development and the environment. It is also often argued that high and increasing inequalities put societies under stress, which increases the likelihood of social conflicts. However, the literature on this topic is scarce and some of the conclusions are not adequately supported by empirical evidence. This is mainly because there are different definitions and measurements of social cohesion. Moreover, some definitions of social cohesion incorporate inequality, thus making it impossible to examine how these two phenomena interact with one another. This paper analyses both theoretically and empirically, the relationship between inequality and social cohesion. To do so, it employs a recent definition of social cohesion provided by Leininger et al. (2021). According to this definition, social cohesion is composed of three core attributes, namely trust, inclusive identity and cooperation for the common good. These attributes are examined in two dimensions, namely the horizontal (relationship among individuals) and vertical (relationship between individuals and state institutions) dimensions of social cohesion. This paper provides an overview of the empirical evidence regarding the relationship between inequality and the three attributes of social cohesion. We find that while inequality is likely to have a negative effect on all three attributes, the intensity of the relationship may depend on some key mediating factors. Moreover, we highlight the main pathways through which inequality could affect each of the three key attributes. The empirical analysis focuses on Africa. While there is some work in this field in Europe and Asia, to the best of our knowledge, there has not been any related empirical work thus far that has focused on African countries. To measure the three attributes of social cohesion, we use a database generated by Leininger et al. (2021), which is based on data from Afrobarometer and the V-Dem Institute. Inequality is mainly measured by the Gini coefficient and data are sourced from the World Income Distribution dataset. As expected, our analysis shows that countries with higher inequality usually have lower levels of social cohesion, which is measured by an aggregate index. This negative correlation holds when we analyse the relationship between the Gini coefficient and the three attributes separately; however, the intensity varies. It is stronger for trust (rho=0.25) compared with the other two attributes (both of which have a rho equal to approximately 0.1). Additional investigations point to substantially different results for the horizontal and vertical dimensions of social cohesion. Higher levels of inequality are associated with lower levels of horizontal trust and horizontal cooperation. On the other hand, higher levels of inequality are associated with higher levels of vertical trust and are essentially uncorrelated with vertical cooperation. These relationships remain substantially unchanged when we use measures of income inequality other than the Gini coefficient. Further analyses that aim to explain the puzzling results for the vertical dimension of social cohesion reveal that our findings are not clearly driven by trust in a specific institution and are also not an artefact of the specific data we used. Indeed, we obtain similar results using data from the World Values Survey. At the same time, it appears that the positive relationship between inequality and vertical trust is visible only among African countries, whereas it is not observed at the global level or for other regions. Further research is needed to confirm whether Africa is truly exceptional in this regard, and if so, why that may be the case.
Topic:
Development, Inequality, Economy, and Social Cohesion
Political Geography:
Africa

118. Just Transitions: A Review of How to Decarbonise Energy Systems While Addressing Poverty and Inequality Reduction

Author:
Daniele Malerba
Publication Date:
01-2022
Content Type:
Working Paper
Institution:
German Institute of Development and Sustainability (IDOS)
Abstract:
Germany promotes “just transition” as a guiding principle for the global transition to a socially and environmentally sustainable economy that incorporates the necessary climate, environmental and energy policy measures. This includes the urgent transformation of economies to become emission neutral while ensuring a process whereby poverty and inequality are reduced, and no one is left behind. The German Development Institute / Deutsches Institut für Entwicklungspolitik (DIE), the World Bank and the German Federal Ministry for Economic Cooperation and Development (BMZ) worked together to explore ways to implement the concept of just transition in German development cooperation. The two papers that have resulted from this process outline approaches to a “just transition for all” and highlight its potential to reduce poverty and inequality (SDG 1 and SDG 10). In recent decades, the interdependencies between social and ecological development have become clear: negative effects of climate change particularly affect vulnerable and marginalised groups living in poverty. At the same time, social inequalities contribute to an exacerbation of climate change. A just transition must effectively address the consequences at the international, national, regional and local levels. Both papers provide an overview of existing approaches and challenges to foster a “just transition for all”. They offer different but complementary perspectives on an increasingly important complex of topics. This first paper, by DIE, takes a broad perspective by considering the decarbonisation of the energy sector as a whole, outlining the connections between just transition, poverty and inequality, and exploring how to ensure a just transition (for both workers and consumers) through the use of different social protection mechanisms. It argues that it is possible to make energy transitions just, but that properly designed combinations of socio-economic and climate policies are needed. A second paper, by the World Bank, zooms in on the transition away from coal. It lays out key social and community impacts resulting from the decommissioning of coal assets, based on experience gained from World Bank operations and from industrialised countries, and articulates an enhanced approach to supporting the coal transition. Both provide practical recommendations for international development cooperation in general, and for German development cooperation in particular.
Topic:
Development, Poverty, Inequality, Economy, and Decarbonization
Political Geography:
Europe and Germany

119. Only game in town? Inequality and demand for democracy in Africa – a micro perspective

Author:
Thomas Isbell
Publication Date:
08-2022
Content Type:
Working Paper
Institution:
Afrobarometer
Abstract:
In this paper, the author explores whether perceived inequality is associated with demand for democracy among Africans. Past research has diverged on whether macro-level inequality should increase or decrease support for democracy, with some arguing that people might see democracy as a solution to inequality, and others that people might see it as a cause. I advance this literature by using a perceptual measure of inequality from Afrobarometer: how people feel their living situation compares to others’ in their country. I find that perceived equality is significantly associated with greater demand for democracy, while perceptions of relative deprivation and relative advantage are both associated with lower democratic demand. These effects are largely significant above and beyond the effect of absolute poverty and known predictors of support for democracy, such as free and fair elections and level of education.
Topic:
Education, Elections, Democracy, Inequality, and Social Order
Political Geography:
Africa

120. Rising concern, falling performance: Health-sector challenges evident before and after onset of COVID-19 pandemic

Author:
Carolyn Logan and Tosin Salau
Publication Date:
07-2022
Content Type:
Policy Brief
Institution:
Afrobarometer
Abstract:
As Africa and the world begin to regroup now that the worst ravages of the COVID-19 pandemic appear to be past, it is an opportune time to take stock of the state of health care systems on the continent. The pandemic is not over – South Africa is just coming out of its fifth wave of infection (Al Jazeera, 2022), and there may be more to come (Landman, Irfan, & Resnick, 2022). In the meantime, the Africa Centres for Disease Control and Prevention (2022) and national governments continue to scale up their vaccination campaigns. But the war in Ukraine and global economic deterioration have finally supplanted COVID-19 at the top of the news cycle. In the early stages of the pandemic, many assessments warned of the possibly extreme vulnerability of Africans to the pandemic based in part on the many challenges already facing health care systems across much of the continent (Mattes, Logan, Gyimah-Boadi, & Ellison, 2020). While the direst predictions did not come to pass in most countries – South Africa being a notable exception – the pandemic has highlighted gaps in health systems amid the recognition that the next global health crisis could hit harder if improvements and preparations are not made. Taking a longer-term view, the United Nations Sustainable Development Goals (SDGs) also highlight the need to strengthen health systems (United Nations, 2018). SDG#3 focuses on good health and well-being. But Afrobarometer’s SDG Scorecards, based on our most recent data from 34 countries surveyed in Round 8 (2019/2021), show that from the perspective of citizens, only a handful of countries have been making significant progress toward achieving this SDG (Afrobarometer, 2021). Instead, a growing number of Africans report going without medical care, and the share who cite health as one of their country’s most important problems is also on the rise. Even among those who do get care, increasing proportions report finding it difficult, and having to pay bribes, to obtain the medical services they need. Not surprisingly, citizens are also increasingly critical of their governments’ performance in this sector: For the first time in two decades of Afrobarometer polling, a majority of respondents say their governments are performing badly on improving basic health services. Moreover, the evidence suggests that the challenges wrought by the pandemic were not the cause of these increasingly negative reviews: The downward trends were already under way before COVID-19 entered the picture, and in fact, in some cases the trends appear to be somewhat less negative since the onset of the pandemic.
Topic:
Health, Inequality, Pandemic, and COVID-19
Political Geography:
Africa