Financial development and growth have long been linked. This column argues that there remain fundamental lacunae in our understanding of the finance-growth nexus. Three main areas for future research are identified: aid, institutions and technology.
Nauro F. Campos, Stefan Dercon, 01 March 2014
Christopher Woodruff, 27 January 2012
Christopher Woodruff talks to Viv Davies about his recent research in Sri Lanka that looks at the constraints to growth of micro-enterprises and how to generate job creation; he highlights the effects of wage subsidies, savings programmes, entrepreneurship training, firm registration and the transition from small informal firms to more dynamic enterprises. They also discuss a new 5-year competitive research grants programme, directed by Woodruff and co-ordinated by CEPR, that focuses on private enterprise development in low-income countries.
Ravi Kanbur, Andy Sumner, 08 November 2011
Many poor people no longer live in poor countries. Of the 10 countries that contribute most to global poverty, six are middle-income countries. For many aid organisations, ‘middle-income’ means they no longer qualify for the same financial aid. This column argues that such a policy would be failing up to a billion people.
Nikola Spatafora, Andrew Berg, 24 May 2011
What effect did the global financial crisis have on low-income countries? This column examines data from the last forty years to help place 2007–2009 in perspective. It finds that the global crisis was largely transmitted to low-income countries through external demand shocks that were not tremendously large relative to historical volatility. Such demand shocks are usually bad for growth in the short to medium run, but they may not have damaged poor economies' long-run growth prospects.