To focus on strengthening the institutional capacity of national systems by linking financing to defined results, the World Bank’s Program-for-Results (PforR) requires a deep understanding of behavioral and institutional bottlenecks that may affect the success of a government program.
... See More + Key to achievements under any public program is the ability, motivation, and productivity of civil servants. They largely determine policy formulation and implementation as well as the government’s ability to effectively deliver on programs and services. A rigorous assessment of bureaucratic capability is a priority during the preparation and implementation phases under a PforR.
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Development break-throughs based on the Industrial Revolution 4.0 to increase productivity, quality, efficiency and competitiveness of the economy.
... See More + Achieve rapid and sustainable development; soon turn Vietnam into a modern industrialized nation. Improving the effectiveness and efficiency of state economic management and state capability in enabling development.
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Development break-throughs based on the Industrial Revolution 4.0 to increase productivity, quality, efficiency and competitiveness of the economy.
... See More + Achieve rapid and sustainable development; soon turn Vietnam into a modern industrialized nation. Improving the effectiveness and efficiency of state economic management and state capability in enabling development.
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This paper investigates the impact of World Bank development policy operations on the quality of economic policy during the period 1998-2015. A new theoretical framework distinguishes among three effects that have been conflated hitherto: (a) marginal impacts of additional policy actions within the current year; (b) length of the policy engagement with client countries, and (c) changes over time in the marginal impact of policy actions.
... See More + The analysis focuses on policy actions that are particularly relevant for the quality of economic management. Consistent with past research, robust panel estimations indicate that development policy financing has a positive effect on the quality of government economic policy. The econometric work suggests that the nature of the policy dialogue and quality of the engagement with government matter more than the sheer number of policy actions adopted. There is also tentative evidence that although the positive impact is sustained over time, the initial years of an engagement are the most productive for improvement in government economic policy. This may be linked to the fact that over time the reform program changes from 'first-generation' to more complex 'second-generation' policy actions.
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Policy Research Working Paper WPS8645 NOV 13, 2018
Is the variation in bilateral trade flows across countries primarily due to differences in the number of exporting firms (the extensive margin) or in the average size of an exporter (the intensive margin)?
... See More + And how does this affect the estimation and quantitative implications of the Melitz (2003) trade model? The benchmark Melitz model with Pareto-distributed firm productivity and fixed costs of exporting, predicts that, conditional on the fixed costs of exporting, all variation in exports across trading partners should occur on the extensive margin. This paper subjects this theoretical prediction to a reality check drawing upon the World Bank's Exporter Dynamics Database (EDD) which has firm-level exports from 50 developing countries to all destinations. Around 50 percent of the variation in exports across trading partners is shown to be along the intensive margin, contradicting the benchmark Melitz-Pareto model. The paper finds that moving from a Pareto to a lognormal distribution of firm productivity allows the Melitz model to successfully match the role of the intensive margin evident in the EDD. The paper then studies the implications of our findings for quantitative trade theory. Using likelihood methods and the EDD, a generalized Melitz model with a joint lognormal distribution for firm productivity, fixed costs and demand shifters is estimated, and exact hat algebra is used to quantify the counterfactual effects of a decline in trade costs on trade flows and welfare in the estimated model. Finally, these effects are compared to those that would be predicted by the Melitz-Pareto model, with the Pareto shape parameter chosen to match the average trade elasticity implied by the estimated Melitz-lognormal model. The paper shows that the effects on welfare turn out to be quite close to those in the standard Melitz-Pareto model even though the effects on trade flows remain different.
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Policy Research Working Paper WPS8625 OCT 26, 2018
This is a statement by Ignazio Visco, Governor of the Bank of Italy, on behalf of the Constituency of Albania, Greece, Italy, Malta, Portugal, San Marino and Timor-Leste, at the ninety-eighth meeting of the Development Committee on October 13, 2018.
... See More + He discusses with the global economic activity weaker than the year prior as a result of downside risks becoming more prominent, he is seeing great potential with the 2019 World Development Report and the Bali Fintech Agenda that was prepared by the IMF and World Bank.
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This is a statement by H.E. Eduardo Guardia, Minister of Finance of Brazil on behalf of Brazil, Colombia, Dominican Republic, Ecuador, Haiti, Panama, Philippines, Suriname, and Trinidad and Tobago, at the ninety-eighth meeting of the Development Committee on October 13, 2018.
... See More + He discusses the importance of the changing times with fintech, human capital and disruptive technologies.
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It is generally believed that firms in emerging markets rely on shorter-term instruments than firms in advanced economies. In recent years, firms in emerging market economies have substantially increased the amount of debt raised in global bond and syndicated loan markets, triggering concerns about their exposure to rollover risks.
... See More + However, new evidence examined in this policy brief shows that emerging market firms have been using these markets to borrow long term, possibly diminishing the risks associated with higher debt levels and foreign currency financing. Challenging the conventional wisdom, large firms from emerging markets have issued bonds and syndicated loans at maturities similar to those issued by firms from advanced economies. These findings have implications for understanding the sources of short-termism in emerging markets, the actual risks emerging economies face from rising levels of corporate borrowing, and the policy measures that may help firms that cannot borrow long term.
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The African Capacity Building Foundation (ACBF) Regional Capacity Building Project had a satisfactory overall outcome, a moderately satisfactory performance by the Bank and the monitoring and evaluation quality was substantial.
... See More + Some of the lessons learned were: (1) Over-dependence on a single donor can hurt substantially. (2) It will be desirable for the ACBF to not jettison its hard-won core business strengths built up over decades – especially on macroeconomic management, monitoring and think tank-based knowledge-sharing. (3) ACBF’s business model must reflect – and adapt swiftly to – its often – swiftly changing operating environment. (4) It is desirable to avoid disconnects between the regional and the national. (5) Introducing Bank-like processes and controls in bodies where they may not be appropriate may generate adverse consequences.
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Implementation Completion and Results Report ICR4380 AUG 31, 2018
This issue of Indonesia Daily Economic Update for July 27, 2018 contains economic highlights, including: Bank Indonesia (BI) is planning to regularly release four new indicators on job vacancy, property markets, payment systems and economic policy uncertainty index, utilizing the development of big data.
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This study investigates empirically the determinants of labor shares focusing on the role of investment and exchange rate volatility. The authors use a system GMM panel approach and consider 34 Organization for Economic Co-operation and Development (OECD) countries along with South Africa for the period 1995-2015.
... See More + The authors results reveal that the level of a country’s investment is a significant factor driving changes in the labor share of income. This evidence is in line with the theoretical mechanism for the role of investment presented by Lawrence (2015). While the authors consider several other factors, suggested by the extant empirical literature, the authors only find evidence for the degree of a country’s exposure to the international financial system, which is inversely related with labor shares. This study is a background note for the South Africa systematic country diagnostic.
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The effect of demographics on poverty measurement based on per capita consumption is well known. The size and composition of the household can affect the well-being of everyone in the household, with respect to total consumption within that household.
... See More + Failure to address this issue may often lead to an underestimation or overestimation of poverty, especially for children. Many studies have tried to address the issue, using the generic approach of equivalence scales. However, the choice of scale is controversial and may lead to comparability problems between countries because of the different demographic structures and choice of the pivot household for establishing the per capita poverty line. Based on the World Bank's African poverty database, this study estimates poverty rates for African children using the new international poverty line of $1.90 a day defined in terms of 2011 purchasing power parity. The equivalence scales approach (Food and Agriculture Organization/World Health Organization) is used with the adjustment suggested by Deaton after the identification of the pivot household, which is defined as the household whose per capita consumption is around the international poverty line. This study shows that taking account of demographics results in downward adjustments of child poverty, adult poverty, and child-adult poverty gaps. Moreover, breakdowns by country show that poverty may vary significantly depending on demographics, which may cause some reranking when comparing poverty between African countries. Finally, sensitivity analyses reveal that child poverty is not sensitive to the child discount factor, unlike adult poverty, but, overall, taking account of demographics is helpful for better identifying poor children.
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Policy Research Working Paper WPS8426 MAY 03, 2018
