Development

Hassen Arouri, Caroline Freund, Antonio Nucifora, Bob Rijkers, 03 July 2015

If more firms are established in developing countries, more jobs are created. But which type of firm creates the most jobs? This column presents evidence from Tunisia suggesting that once you’re established as a new and promising firm, it’s harder than it should be to grow and create jobs. Weak firm dynamics and imperfections in the market prevent the best firms from flourishing.

Otaviano Canuto, Francisco Carneiro, Leonardo Garrido, 01 July 2015

Industrialised and developing countries have differing fiscal strategies for dealing with the business cycle. But are countries’ strategies different according to whether they are industrialised? This column presents new evidence suggesting that the picture is complex. Procyclical fiscal policies remain the norm amongst most non-industrialised developing countries, but some key developing countries have recently moved toward a counter-cyclical stance as a result of strengthening institutions.

Orazio Attanasio, Britta Augsburg, Ralph De Haas, Emla Fitzsimons, Heike Harmgart, Costas Meghir, 17 June 2015

There have been intense debates on whether microfinance can lift people out of poverty. Summarising research across seven countries, this column argues that microcredit is a useful financial tool but not a powerful anti-poverty strategy. There are also no significant benefits in terms of education or female empowerment. Yet, microcredit does allow low-income households to better cope with risk and to enjoy greater flexibility in how they earn and spend money. 

Ravi Kanbur, Adam Wagstaff, 10 June 2015

Reducing inequality of opportunity, rather than inequality of outcome, is often heralded as an appropriate target for policy. This column explores the challenges of identifying inequality of opportunity. Disentangling how effort and circumstance contribute to outcomes is difficult, and this leads to a tendency to underestimate inequality of opportunity. This lends support for generalised social protection measures in dimensions such as income, health and education, irrespective of whether the outcomes can be specifically attributed to circumstance or to effort.

Ejaz Ghani, William Kerr, Alex Segura, 09 June 2015

The vast informal sector in India affects everything from poverty to growth. This column presents new facts on how Indian job growth in manufacturing is concentrated in informal tradable industries, especially one-person establishments. These features are most closely linked to the urbanisation of informal Indian manufacturing, but subcontracting and rising female participation also appear to play noteworthy roles.

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