Jie Bai, Seema Jayachandran, Edmund Malesky, Benjamin Olken, 22 November 2013

Eliminating corruption is a central policy goal of policymakers around the globe. It is known that corruption is a barrier to economic development because it increases the costs and risk of business activity, and deters investment. This column discusses a new study analysing the opposite causal relationship – the effect of economic growth on corruption. Both theoretical and empirical evidence show that economic growth causes the amount of corruption to fall.

Carlos Vegh, Guillermo Vuletin, 01 October 2013

Government spending is procyclical in developing countries, exacerbating the business cycle. However, an analysis of tax policy is also required in order to properly assess the overall stance of fiscal policy. This column presents recent research showing that tax policy tends to be procyclical in developing countries and acyclical in developed countries. Although some developing countries have managed to escape the procyclical fiscal policy trap, some developed nations – notably Eurozone members – are falling into it.

Hector Torres, 21 September 2013

'Special and differential treatment' was justified on the basis that developing countries lacked the fiscal resources to smooth the transition to free trade. However, despite improved fiscal circumstances, exceptions to WTO rules remain in place. Establishing an independent watchdog for the WTO could help it to address these issues.

Martin Cihák, Asli Demirgüç-Kunt, Erik Feyen, Ross Levine, 25 April 2013

Is there too much financial development, or too little? Can economists even measure it well? This column argues that commonly used measures of financial development are poor proxies of what the financial system actually does, presenting a new worldwide database that aims to fill some of the gaps. There needs to be a stronger link between the theory and measurement of financial development.

Peter Draper, 16 July 2012

Fundamental changes to global value chains are afoot. This column argues that over the next decade the underlying cost structures driving their location could change dramatically. It presents a recent report on the political economy of value chains and the implications for developing countries and trade policy.

Joshua Aizenman, Yothin Jinjarak, Donghyun Park, Minsoo Lee, 19 May 2012

The Eurozone debt crisis has emerged as the single biggest threat to the global outlook. Applying event study methodology, this column estimates the responsiveness of equity and bond markets in developing countries and emerging markets to crisis news between 2005 and 2011. Whereas global crisis news had a consistently negative effect on equities and bonds, the Eurozone crisis looks thankfully more mixed and limited, so far.

Céline Carrère, Jaime de Melo, 17 May 2012

It is not just the OECD countries where fiscal policy is the subject of fierce debate. This column presents results from an “event analysis” carried out on a database of 140 countries over the period 1972-2005. It suggests that, for developing countries at least, a fiscal stimulus can be effective – provided the rest of the economy is stable and the fiscal deficit is low.

Eduardo Cavallo, Carlos Scartascini, 12 May 2012

For some commentators, the recent financial crises are a sign that financial development has gone too far. Yet there are still countries where such concerns are the stuff of dreams. This column focuses on why the level of financial development in poor countries remains so low and what policymakers can do about it.

Jorge Andrade da Silva, Lucian Cernat, 09 February 2012

Natural disasters often hit developing countries hardest. To add to the devastating death toll, trade and development can be knocked off course. This column suggests that exports of small developing countries fall by nearly a quarter, and that this effect can be felt for up to three years. Exports of larger developing countries, on the other hand, are not significantly affected.

Benjamin Olken , Rohini Pande, 21 January 2012

Recent innovations in methodology have sparked a remarkable expansion in economists’ ability to measure corruption. This column reviews these new techniques, which range from inferring corrupt links from stock prices to attempting to observe bribes undercover. It concludes that, while corruption is prevalent in poor countries, there remains little consensus about its magnitude or the best way to fight it.

Thomas Farole, 28 September 2011

As competition for FDI and trade share intensifies in a tightening global environment, more and more countries are looking at the potential of special economic zones to kickstart growth. But China aside, do these zones work? This column asks: what have we learned from the experiences of developing countries over recent decades?

Bernard Hoekman, Guido Porto, 18 June 2010

When developing countries open up their markets, there are costs as well as benefits. The papers in this CEPR/World Bank volume investigate adjustment to trade, and argue that unemployment is only part of the story, adding that the development community should aim to address the constraints that prevent too many households from seizing the newly available opportunities.

Sübidey Togan, 28 April 2011

For developing countries, following the principles of sound economic policy and establishing the appropriate institutions of a functioning market economy is a very challenging task. This column says that completing the Doha Round could help them follow at least some of the principles of sound economic policy and establishing some of the appropriate institutions of functioning market economies.

Peter Draper, Andreas Freytag, Matthias Bauer, 16 April 2011

The economic fate of developing countries since the global crisis has been in doubt. In the second of two columns on the “Seoul Consensus”, the authors argue that industrialised economies are not in a position to take the lead in initiatives to strengthen economic policy rationality on a global scale. Emerging economies should take the lead and push for the conclusion of the Doha Round.

Robert Townsend, 17 December 2010

Robert Townsend talks about his recent book, co-authored with Krislert Samphantharak, that analyses household finance in developing countries using integrated household surveys. Townsend describes how to create new and more comprehensive household ‘accounts’, and use them to analyse productivity, capital structure and liquidity in households. The interview was recorded in London in November 2010. [Also read the transcript]

Johannes Van Biesebroeck, Timothy Sturgeon, 10 August 2010

Could the car industry in developing countries start to produce vehicles that can compete domestically – perhaps even globally? This column argues that while the prospects for the automotive sector are still less promising than for other industries, as the markets for motor vehicles shift to the developing world and production inevitably follows, more development and design work will shift as well.

Bernard Hoekman, Guido Porto, 18 June 2010

When developing countries open up their markets, there are costs as well as benefits. This column presents findings from a collection of papers investigating adjustment to trade. It argues that unemployment is only part of the story, adding that the development community should aim to address the constraints that prevent too many households from seizing the newly available opportunities.

Fabrizio Coricelli, 01 May 2010

Why have emerging economies weathered the crisis better than advanced countries? This column summarises a session given by Alan Winters, Saul Estrin, Thorsten Beck, and organised by Nauro Campos at the Royal Economic Society annual conference in March 2010. The contributions argue that the crisis may have long-lasting effects on migration, foreign direct investment, and financial development in Africa.

Bilal Habib, Ambar Narayan, Sergio Olivieri, Carolina Sanchez-Paramo, 19 April 2010

A shortage of real-time data hinders evaluations of the impact of the global crisis on developing countries. This column uses a “microsimulation” approach to assess the poverty and distributional effects in Bangladesh, Mexico, and the Philippines. It finds that poverty will increase by well over a million, and that the crisis has been hardest for middle-income households.

Nauro Campos, 22 December 2009

Does ethno-linguistic fractionalisation stifle economic growth? This column presents new evidence that considers how fractionalisation changes over time and treats it as both a cause and an effect of economic growth. While fractionalisation is found to have a negative effect on growth, it also changes over time, contrary to conventional wisdom.

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