The interplay of ideas and policies is central to understanding the historical evolution of economies. Ideas shape economic institutions and real economic constraints are the source of new economic ideas. The history of economic ideas, both those that are fairly recent and those that are considerably older, may provide a fertile ground for new appr
This book provides the theoretical and analytical background necessary to understanding the process of growth and the implementation of economic policies. First, it presents the growth theory landscape and the evolution of growth as well as modern growth theory arguments where the policy implications of the theoretical approaches are set. The book then covers the relationship between policy and growth, discussing not only the growth prototypes that prevail but also their relation to politics and economic policy formation and decision making. In this context, policy formation determinants, as well as the targets, instruments, and policy implementations, are crucial. The role of structural changes and structural reforms and their relationship with economic growth is also analyzed. The book ends with an interdisciplinary study of how institutions and cultural background, entrepreneurship and innovation affect policy formation.
A large percentage of workers and firms operate in the informal economy, outside the line of sight of governments in emerging market and developing economies. This may hold back the recovery in these economies from the deep recessions caused by the COVID-19 pandemic--unless governments adopt a broad set of policies to address the challenges of widespread informality. This study is the first comprehensive analysis of the extent of informality and its implications for a durable economic recovery and for long-term development. It finds that pervasive informality is associated with significantly weaker economic outcomes--including lower government resources to combat recessions, lower per capita incomes, greater poverty, less financial development, and weaker investment and productivity.
The COVID-19 pandemic struck the global economy after a decade that featured a broad-based slowdown in productivity growth. Global Productivity: Trends, Drivers, and Policies presents the first comprehensive analysis of the evolution and drivers of productivity growth, examines the effects of COVID-19 on productivity, and discusses a wide range of policies needed to rekindle productivity growth. The book also provides a far-reaching data set of multiple measures of productivity for up to 164 advanced economies and emerging market and developing economies, and it introduces a new sectoral database of productivity. The World Bank has created an extraordinary book on productivity, covering a large group of countries and using a wide variety of data sources. There is an emphasis on emerging and developing economies, whereas the prior literature has concentrated on developed economies. The book seeks to understand growth patterns and quantify the role of (among other things) the reallocation of factors, technological change, and the impact of natural disasters, including the COVID-19 pandemic. This book is must-reading for specialists in emerging economies but also provides deep insights for anyone interested in economic growth and productivity. Martin Neil Baily Senior Fellow, The Brookings Institution Former Chair, U.S. President’s Council of Economic Advisers This is an important book at a critical time. As the book notes, global productivity growth had already been slowing prior to the COVID-19 pandemic and collapses with the pandemic. If we want an effective recovery, we have to understand what was driving these long-run trends. The book presents a novel global approach to examining the levels, growth rates, and drivers of productivity growth. For anyone wanting to understand or influence productivity growth, this is an essential read. Nicholas Bloom William D. Eberle Professor of Economics, Stanford University The COVID-19 pandemic hit a global economy that was already struggling with an adverse pre-existing condition—slow productivity growth. This extraordinarily valuable and timely book brings considerable new evidence that shows the broad-based, long-standing nature of the slowdown. It is comprehensive, with an exceptional focus on emerging market and developing economies. Importantly, it shows how severe disasters (of which COVID-19 is just the latest) typically harm productivity. There are no silver bullets, but the book suggests sensible strategies to improve growth prospects. John Fernald Schroders Chaired Professor of European Competitiveness and Reform and Professor of Economics, INSEAD
This book focuses on describing policy instruments in different countries. Its purpose is not only descriptive but also, to some extent, advocatory. We believe that economic instruments can make an important contribution to an environmentally less disruptive path of development. The design of economic instruments is however a fine art and depends among other things on their political acceptability and this acceptability is of course influenced by experience. It is therefore important to provide information on the use of policy instruments in other countries. Policies are currently developing quite fast and thus a book such as this one can inevitably not capture more than a "snapshot" view at a single moment of time. We would hope that the book encourages more experimentation with economic instruments and that countries will make a fuller use of the whole arsenal of economic policy instruments. If the book does succeed in this sense then it will soon become dated as policies change -but that would be a price well worth paying! The book combines a dozen country monographs together with a few international surveys on particular topics (gasoline pricing, vehicle regulations, acid rain, deforestation and global warming). These papers are intended to illustrate the diversity of policy options available. The actual policies adopted depend on economic as well as ecological conditions. The country studies cover two "Western" countries and then concentrate on formerly planned and developing countries. They show that economic instruments are still generally thought of as new and innovative.
This book includes empirical contributions focusing on disadvantaged workers. According to the European Commission’s definition, disadvantaged workers include categories of workers with difficulties entering the labour market without assistance and hence, requiring the application of public measures aimed at improving their employment opportunities. In addition to the labour market perspective, this is also relevant in terms of social cohesion, which is one of the central objectives of the European Union and of its Member States. This work deals with the most relevant groups of disadvantaged workers, namely disabled workers, young workers, women living in depressed areas, migrants in the labour market and the long-term unemployed, and analyses the situation in the Italian, Spanish and some African labour markets. The determinants of disadvantage in the labour market are investigated, highlighting both the role of supply variables, including structural factors and the weakness on the demand side, the role of the economic crisis and the ineffectiveness of some labour policies. A complex framework emerges in which disadvantaged groups may share common problems, both in terms of integration into the labour market and in terms of working conditions, but often require group-specific policies, taking into account their intergroup heterogeneity.
Governments fail to provide the public goods needed for development when its leaders knowingly and deliberately ignore sound technical advice or are unable to follow it, despite the best of intentions, because of political constraints. This report focuses on two forces—citizen engagement and transparency—that hold the key to solving government failures by shaping how political markets function. Citizens are not only queueing at voting booths, but are also taking to the streets and using diverse media to pressure, sanction and select the leaders who wield power within government, including by entering as contenders for leadership. This political engagement can function in highly nuanced ways within the same formal institutional context and across the political spectrum, from autocracies to democracies. Unhealthy political engagement, when leaders are selected and sanctioned on the basis of their provision of private benefits rather than public goods, gives rise to government failures. The solutions to these failures lie in fostering healthy political engagement within any institutional context, and not in circumventing or suppressing it. Transparency, which is citizen access to publicly available information about the actions of those in government, and the consequences of these actions, can play a crucial role by nourishing political engagement.
This book examines the reasons for the unprecedented weak recovery following the recent US recession and explores the possibility that government economic policy is the problem. Drawing on empirical research that looks at issues from policy uncertainty to increased regulation, the volume offers a broad-based assessment of how government policies are slowing economic growth and provides a framework for understanding how those policies should change to restore prosperity in America.
