Development

[field_auth], 29 July 2016

The Latin American and Caribbean region is trapped in a vicious cycle of low savings and poor use of these savings. This column describes how this problem is reinforced by the current financial system, and prescribes three remedies to policymakers and households to break the cycle. The government should create a better environment for saving and develop a better financial system, but it should also tackle investment distortions and fix broken pension systems. Meanwhile, a change in saving culture should be encouraged from the ground up, with financial education offered to citizens early on in their lives.

[field_auth], 22 July 2016

Despite Narendra Modi’s successful leadership as chief minister of Gujarat, some question his ability to achieve the same progress at the national level as India’s prime minister. This column analyses Modi’s political background and state- and national-level experience to assess his capacity to navigate India through a politically and economically important time towards its goal of becoming a prosperous economy. It finds that while Modi can lean on his Gujarati experience to some extent, in other aspects he will have to depart from his incremental approach to policymaking in favour of radical changes, particularly in the area of employment maximisation. 

[field_auth], 02 July 2016

The past decade has seen rapid growth in an interdisciplinary body of research examining the legacy of war on social and political behaviour. This column presents a meta-analysis and synthesis of this research. Evidence from surveys and experiments from over 40 countries reveals a stylised fact: individual exposure to war-related violence tends to increase social cooperation, community participation, and pro-social behaviour. However, these changes are mainly directed towards people from the same community.

[field_auth], 26 June 2016

When it comes to measuring GDP, researchers tend to use the latest vintage of the Penn World Tables. However, competing series like the World Development Indicators (WDI) and changing methodologies between vintages mean this is not necessarily the best approach. This column assesses the relative performance of different GDP estimators using night-time lights as an unbiased predictor of the growth rates of unobserved true income. Newer versions of the Penn Tables are not necessarily improvements on their direct predecessors.  Newer versions of the WDI index, especially the 2011 vintage, appear generally better at measuring cross-country income differences.

[field_auth], 09 June 2016

The importance of investment in children’s pre-school years for their later life outcomes is increasingly recognised by policymakers. This column surveys the evidence on early childhood development policies in both developed and developing countries. Research suggests that effective education programmes can be implemented at scale even in low-income settings, but the quality of the service and adapting it to the local context are crucial. Sustaining the gains from intervention in the ‘early years’ is also likely to require continuing investment at later stages of childhood.

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