Avinash Persaud, 23 February 2021

The switch to renewable energies is necessary for humanity’s future, but it is currently too slow. For developing countries, the critical obstacle is the pricing, ownership, land-use and approval processes renewable projects have to go through. This column argues that to bring dividends for sunnier, developing countries, provide more projects for green investors, and for some redemption for the rest of humanity, countries should (1) streamline the approval process, (2) broaden the ownership of assets through mandated initial public offerings and small-investor allocations while supporting big foreign investors in the short-run, and (3) offer an attractive feed-in tariff that predictably ratchets down in favour of consumers once investors reach their return threshold.

Pierre Dubois, Yassine Lefouili, Stephane Straub, 30 January 2021

Patients in the developing world often face prices for essential medicines far in excess of international reference levels, even if those drugs have lost patent protection. This column presents evidence from seven low- and middle-income countries with diverse drug procurement systems to assess the effect of centralised procurement on drug prices. The results of the study highlight that centralised procurement of drugs by the public sector leads to lower prices, but that the induced price reduction is smaller when the supply side is more concentrated.

Roberto Bonfatti, Steven Poelhekke, 03 December 2020

Africa’s interior-to-coast roads are well placed to export natural resources, but not to support regional trade. Are they the optimal response to geography and comparative advantage, or the result of suboptimal political distortions? This column investigates the political determinants of road paving in West Africa in 1965–2014. Autocracies focused more than democracies on connecting metal and mineral deposits to ports, resulting in more interior-to-coast networks. This deposit-to-port bias was only present for deposits located on the elite’s ethnic homeland, suggesting that Africa’s interior-to-coast roads were the result of ethnic favouritism by autocracies.

Federico Di Pace, Luciana Juvenal, Ivan Petrella, 28 November 2020

The abrupt movements in commodity prices at the onset of the Covid-19 crisis have reignited policymakers’ concerns over movements in the terms of trade. The shock has certainly confirmed that terms of trade are very volatile and extremely sensitive to changes in global economic activity. This column argues that these terms of trade shocks are likely to have a persistent impact on the business cycle of developing economies, which are particularly vulnerable to fluctuations in the price of their exports.  

Ravi Kanbur, 21 September 2020

From the public discourse, it seems clear that we are living in an age of rising inequality. However, common measures of income and consumption inequality disguise a more nuanced pattern of inequality change across the world. This column argues that inequality within countries has not been rising everywhere and that inequality between countries has decreased. At the same time, technological progress is increasingly displacing basic labour in favour of skilled labour and capital, across borders, and widening the wage gap. The overall effect is unclear. National policies to mitigate inequality are needed but, in the absence of international cooperation, are constrained by cross-border spillovers.

Emmanuelle Auriol, Julie Lassébie, Amma Panin, Eva Raiber, Paul Seabright, 19 September 2020

The Pentecostal church is one of the fastest-growing segments of Christianity, including in sub-Saharan Africa. The church makes a strong and explicit link between ‘giving to God’ and future wellbeing; donations can be seen as a form of insurance for the future. This column tests how formal market-based insurance affects the demand for informal church-based insurance in Accra, Ghana. People enrolled in a formal insurance policy give less money to their church and to other charitable organisations.

Thorsten Beck, Mohammad Hoseini, 28 August 2020

The high degree of informality in developing countries means most low-income workers have not been able to work from home during the Covid crisis or benefit from employment protection. Despite limited fiscal space and limited access to international financial markets, many developing country governments have implemented support programmes for households and firms. This column assesses the impact of an emergency household loan programme in Iran on consumption. It finds that the loans are positively related with higher consumption of non-durable and semi-durable goods, with no significant effect on the consumption of durables or asset purchases, suggesting that the emergency loans were predominantly used for their intended purpose.

Gaston Gelos, Umang Rawat, Hanqing Ye, 20 August 2020

Emerging markets and developing countries are particularly vulnerable to economic shocks such as that posed by COVID-19, not least because of their often weaker monetary policy frameworks. This column discusses the extent to which these economies have been able to react to the crisis with a loosening of monetary policy. While the initial inflation level is an important determinant of a country’s ability to cut rates, additional institutional factors can also affect their ability to conduct countercyclical monetary policy during the crisis.   

Walker Hanlon, Casper Worm Hansen, Jake Kantor, 15 July 2020

Temperature can affect human health and mortality. Historical evidence on the changing relationship between temperature and mortality may be useful in today’s world as we consider adaptive strategies to face global warming. This column uses detailed weekly mortality data from London for 1866–1965 to examine how the temperature-mortality relationship changed as the city developed. In 1866–1914, high-temperature events increase mortality for several weeks, but much of the effect of high temperatures on mortality has disappeared after WWI. The change is linked to the significant reduction in infant digestive disease around 1900.

Caitlin Brown, Martin Ravallion, Dominique van de Walle, 27 June 2020

Recommendations to limit the spread of COVID-19 call for social distancing, washing, and access to information and treatment. However, people need to be in household environments that allow them to follow those recommendations. This column examines the relationship between poverty and the adequacy of the home environment. There is a strong wealth effect both within and between countries, where the poor are less likely to have the kind of dwellings and infrastructure to follow WHO recommendations. Complementary policies to address such inadequate home environments are needed.

Titan Alon, Minki Kim, David Lagakos , Mitchell VanVuren, 26 June 2020

The COVID-19 pandemic has led to dramatic policy responses in most advanced economies, and in particular sustained lockdowns matched with sizable transfers to workers. This column discuss the extent to which developing countries should try to replicate these policies. Due to differences in labour market informality, fiscal capacity, healthcare infrastructure, and demographics, blanket lockdowns appear less effective in developing countries. Age-targeted policies – where the young are allowed to work while the old are shielded from the virus – can potentially save both more lives and livelihoods.

Simeon Djankov, Ugo Panizza, 22 June 2020

At the beginning of the COVID-19 pandemic, it was hoped that warm weather and younger populations would shield many developing countries from the virus. This hope has not been in realised. Infected cases in Africa, South Asia and Latin America are still growing, with Latin America having surpassed the number of cases in Europe and growing rapidly. This column introduces a new eBook that describes the early work focusing on developing and emerging markets. It concludes that the international community should step up, by providing aid, technical assistance and debt relief so that countries will not need to decide between saving lives and servicing their debts.

Ken Mayhew, Samuel Wills, 18 June 2020

Inequality within most developed countries is higher today than it was 30 years ago. Growth in emerging economies has reduced inequality between nations, but the benefits have been unevenly spread within those economies. This column analyses what has happened, why we should care, and what can be done about inequality. Governments have not focused enough on pre-market policies that prevent inequality arising in the first place. Post-market interventions should be seen as too little, too late. Instead, we need a call-to-arms for governments to re-focus on the deep underlying drivers of inequality.

Ramanand Jeeneea, Kaviraj Sharma Sukon, 09 May 2020

The government of Mauritius responded early to the COVID-19 pandemic with stringent lockdown measures and saw a drastic reduction in new cases. This column examines the Mauritian response and estimates that the measures led to an 80% reduction in the coronavirus transmission rate. A well-implemented and early ‘hard lockdown’ can be effective in managing the spread of COVID-19.

Zachary Barnett-Howell, Ahmed Mushfiq Mobarak, 07 May 2020

Governments around the world have implemented social distancing and lockdown policies designed to inhibit the spread of the coronavirus by restricting the movement and everyday activity of billions of people. This column uses the Imperial College London COVID-19 Response Team’s epidemiological model to estimate the benefit from a set of social distancing and suppression policies in different countries. A younger population, less susceptible to the disease and less willing to exchange economic wellbeing for risk reduction, means that lockdown measures are likely to be less valuable in poorer countries. 

Sebastian Horn, Carmen Reinhart, Christoph Trebesch, 04 May 2020

COVID-19 is wreaking economic havoc, and its most severe consequences are likely to be felt in the developing world. Recession, depressed commodity prices, collapsing cross-border trade, and a flight to safety in financial markets have set the stage for a replay of the 1930s and 1980s debt crises. This column presents insights from a comprehensive new dataset on China’s overseas lending and shows that developing countries are much more indebted to China than previously known. Any effort to provide meaningful debt relief to the most vulnerable countries must encompass the debts owed to China.

Christopher Woodruff, 30 April 2020

Low-income countries lack the resources to replicate European-style income support programmes to alleviate the economic impact of COVID-19 lockdowns. In Bangladesh, a key challenge will be to support export-oriented production in the ready-made garment sector, which employs 4 million workers. Whether factories retain or lay off workers in response to government policies – and whether the health crisis escalates into a humanitarian crisis or not – depends crucially on decisions of foreign apparel buyers to honour or drop commitments to previously agreed orders.

Alvaro Espitia, Nadia Rocha, Michele Ruta, 09 April 2020

The COVID-19 pandemic is increasingly a concern for developing countries. This column shows that most developing countries rely heavily on imports to meet their needs of medical supplies essential to combat COVID-19. Recently imposed export restrictions by leading producing countries could thus cause significant disruptions in supplies for developing countries and might further contribute to price increases of medical supplies. Taking multiplier effects into account, prices for medical supplies are estimated to rise by up to 23% on average. Tariffs and other restrictions to imports further impair the flow of critical products to developing countries.

Tohid Atashbar, 13 April 2020

There is a growing trend as well as increasing public pressure in developing or emerging economies to follow the US and EU-led approaches to dealing with the coronavirus pandemic, without considering local economic settings. This imitation may lead to a worsening of the situation, especially if the pandemic were to last for a longer period of time. This column proposes a framework for a safer policymaking approach, especially for countries with a tighter policy space. Policy responses should be evaluated based on how the resources are generated and spent using a set of pre-defined criteria. 

Toby Phillips, 05 February 2020

In richer developed nations almost 90% of people are online, but this number is less than 20% in the least-developed countries. This column presents the Pathways for Prosperity Commission’s final report, which offers pragmatic suggestions to help developing countries make the most of technological change. It proposes a ‘digital compact’, with countries working towards a shared vision for the future crafted with the input of industry, civil society, and other national leaders.


CEPR Policy Research