Commission on Growth and Development

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The Growth Commission’s reports identify the ingredients that, if used in the right country-specific recipe, can deliver growth and help lift populations out of poverty. The Commission, consisting of 19 experienced leaders and 2 Nobel prize-winning economists, has released several commission reports, thematic volumes, and background working papers. The spring 2010 volume is the final book from the Commission. The Commission is succeeded by The Growth Dialogue.

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Now showing 1 - 8 of 8
  • Publication
    Africa's Growth Turnaround: From Fewer Mistakes to Sustained Growth
    (World Bank, Washington, DC, 2009) Page, John
    After stagnating for much of its postcolonial history, economic performance in Sub?Saharan Africa has markedly improved. Since 1995, average economic growth has been close to 5 percent per year. Has Africa finally turned the corner? This paper analyzes growth accelerations and decelerations-that is, country level deviations from long?run trend growth. Seen from this perspective, Africa's record of slow and volatile growth reflects a pattern of offsetting accelerations and declines, and much of the improvement in economic performance in Africa post 1995 turns out to be due to a substantial reduction in the frequency and severity of growth decelerations. The fall in economic declines since 1995 is largely due to better macroeconomic policies, but changes in such 'growth determinants' as investment, export diversification, and productivity have not accompanied the growth boom. Lack of change in these variables and the significant role played by natural resources in sparking growth accelerations suggest that Africa's growth recovery was fragile, even before the recent global economic crisis. The paper concludes by setting out four elements of a strategy that can help move Africa from fewer mistakes to sustained growth: managing natural resources better, pushing nontraditional exports, building the African private sector, and creating new skills.
  • Publication
    Growth after the Crisis
    (World Bank, Washington, DC, 2009) Rodrik, Dani
    How hospitable will the global environment be for economic growth in the developing world as we come out of the present financial crisis? The answer depends on how well the author manage the following tension. On the one hand, global macro stability requires that we prevent external imbalances from getting too large. On the other hand, growth in poor nations requires that the world economy be able to absorb a rapid increase in the supply of tradable produced in the developing world. It is possible to render these two requirements compatible, but doing so requires greater use of explicit industrial policies in developing countries, which have the potential of encouraging of modern tradable activities without spilling over into trade surpluses. The 'price' to be paid for greater discipline on real exchange rates and external imbalances is greater use (and permissiveness) towards industrial polices.
  • Publication
    Africa's Growth Turnaround: From Fewer Mistakes to Sustained Growth
    (World Bank, Washington, DC, 2009) Page, John
    After stagnating for much of its postcolonial history, economic performance in Sub?Saharan Africa has markedly improved. Since 1995, average economic growth has been close to 5 percent per year. Has Africa finally turned the corner? This paper analyzes growth accelerations and decelerations-that is, country level deviations from long?run trend growth. Seen from this perspective, Africa's record of slow and volatile growth reflects a pattern of offsetting accelerations and declines, and much of the improvement in economic performance in Africa post 1995 turns out to be due to a substantial reduction in the frequency and severity of growth decelerations. The fall in economic declines since 1995 is largely due to better macroeconomic policies, but changes in such 'growth determinants' as investment, export diversification, and productivity have not accompanied the growth boom. Lack of change in these variables and the significant role played by natural resources in sparking growth accelerations suggest that Africa's growth recovery was fragile, even before the recent global economic crisis. The paper concludes by setting out four elements of a strategy that can help move Africa from fewer mistakes to sustained growth: managing natural resources better, pushing nontraditional exports, building the African private sector, and creating new skills.
  • Publication
    Growth and Education
    (World Bank, Washington, DC, 2009) Aghion, Philippe
    Does education matter for growth? Which type of education investment (primary, secondary, or tertiary) matters most? Is there a relationship between growth or innovation and the governance of higher education? This paper surveys recent attempts at answering these questions. It first contrasts the 'Lucas approach,' whereby growth is affected by the accumulation of human capital, with the 'Nelson?Phelps approach,' whereby growth is affected by the stock of human capital and by its interaction with the underlying process of technological innovation. Then the paper argues that growth in countries that are close to the world technological frontier benefit more from tertiary education, whereas countries that lie below the frontier benefit more from primary and secondary education. Finally, the paper discusses the relationship between innovation and the governance of universities.
  • Publication
    Chile's Growth and Development: Leadership, Policy-Making Process, Policies, and Results
    (World Bank, Washington, DC, 2009) Schmidt-Hebbel, Klaus
    This paper analyzes the relations between leadership, the policy making process, policies and institutions, and development results in Chile. It starts with a stylized model for the dynamics of development that derives a Kuznets type relation between growth and distribution of income, determined by the quality of leadership, the policy making process, institutions, and policies. This framework is applied to Chile, identifying the features of the policy making process and leadership that allowed for continuation of growth enhancing reform, with a stronger focus on equity goals, since the transition to democracy. As a result of three decades of reforms, Chile has recorded a quantum leap in economic growth, which is traced down to specific reforms. Yet Chile's equity experience is much more mixed: poverty has declined massively but income remains highly concentrated, a likely result of shortcomings in the quality of education and in labor markets. The paper reviews the major risks to the country's future development pace and points out the main reform challenges faced by policy makers.
  • Publication
    Investment Efficiency and the Distribution of Wealth
    (World Bank, Washington, DC, 2009) Banerjee, Abhijit V.
    The point of departure of this paper is that in the absence of effectively functioning asset markets the distribution of wealth matters for efficiency. Inefficient asset markets depress total factor productivity (TFP) in two ways: first, by not allowing efficient firms to grow to the size that they should achieve (this could include many great firms that are never started); and second, by allowing inefficient firms to survive by depressing the demand for factors (good firms are too small) and hence factor prices. Both of these effects are dampened when the wealth of the economy is in the hands of the most productive people, again, for two reasons: first, because they do not rely as much on asset markets to get outside resources into the firm; and second, because wealth allows them to self insure and therefore they are more willing to take the right amount of risk. None of this, however, tells us that efficiency enhancing redistributions must always be targeted to the poorest. There is some reason to believe that a lot of the inefficiency lies in the fact that many medium size firms are too small.
  • Publication
    From Growth Theory to Policy Design
    (World Bank, Washington, DC, 2009) Aghion, Philippe; Durlauf, Steven
    This paper focuses on how growth theory can guide growth policy design. It first argues that policy matters for growth, in particular when policy variables are interacted with country?specific variables (financial development, institutional environment, technological development, and so forth). Second, it argues that the Schumpeterian paradigm does a better job at delivering policy prescriptions that vary with country characteristics. Third, it discusses the advantages and drawbacks of growth regression analysis. Finally, it briefly describes and then questions the recently proposed 'growth diagnostic' approach.
  • Publication
    Current Debates on Infrastructure Policy
    (World Bank, Washington, DC, 2009) Estache, Antonio; Fay, Marianne
    This paper provides an overview of the major current debates on infrastructure policy. It reviews the evidence on the macroeconomic significance of the sector in terms of growth and poverty alleviation. It also discusses the major institutional debates, including the relative comparative advantage of the public and the private sector in the various stages of infrastructure service delivery as well as the main options for changes in the role of government (i.e. regulation and decentralization).