Bussolo, MaurizioMedvedev, Denis2012-06-082012-06-082007-11https://hdl.handle.net/10986/7544This paper summarizes the policy lessons from applications of the Maquette for MDG Simulations (MAMS) model to two low income countries: Ghana and Honduras. Results show that costs of MDGs achievement could reach 10-13 percent of GDP by 2015, although, given the observed low productivity in the provision of social services, significant savings may be realized by improving efficiency. Sources of financing also matter: foreign aid inflows can reduce international competitiveness through real exchange appreciation, while domestic financing can crowd out the private sector and slow poverty reduction. Spending a large share of a fixed budget on growth-enhancing infrastructure may mean sacrificing some human development, even if higher growth is usually associated with lower costs of social services. The pursuit of MDGs increases demand for skills: while this encourages higher educational attainments, in the short term this could lead to increased income inequality and a lower poverty elasticity of growth.CC BY 3.0 IGOACCESS TO SAFE WATERACCOUNTINGAGGREGATE COSTSALLOCATIONANNUAL GROWTHANNUAL GROWTH RATEANNUAL WAGEAVERAGE LEVELBASELINE SCENARIOBASIC EDUCATIONBASIC SERVICESBONDBOND ISSUESBORROWINGBUDGET CONSTRAINTSBUDGET ENVELOPECAPITAL SPENDINGCHILD HEALTHCHILD MORTALITYCHILD MORTALITY RATECHILD MORTALITY RATESCOMPUTABLE GENERAL EQUILIBRIUMCONSUMERSCONSUMPTION GROWTHCONTRIBUTIONCONTRIBUTIONSCOST ESTIMATESCOUNTRY SPECIFICCURRENT PRICESDATA COLLECTIONDEBTDEBT SUSTAINABILITYDEMAND FOR SERVICESDEPENDENT VARIABLEDEVELOPING COUNTRIESDEVELOPMENT ECONOMICSDEVELOPMENT POLICYDEVELOPMENT STRATEGIESDISEASESDISTRIBUTION OF INCOMEDISTRIBUTIONAL EFFECTSDOMESTIC BORROWINGEARNINGSECONOMIC GROWTHECONOMIC POLICIESECONOMIC SHOCKSEDUCATION SPENDINGEDUCATIONAL SERVICESEMPIRICAL LITERATUREENVIRONMENTAL RESOURCESESTIMATED ELASTICITYEXCHANGE RATEEXCHANGE RATESEXTERNAL DEBTFISCAL SUSTAINABILITYFOREIGN BORROWINGFOREIGN CURRENCYFOREIGN GRANTSFUTURE GROWTHFUTURE INCOMEGENDER DISPARITYGENDER EQUALITYGENDER GAPGINI COEFFICIENTGOVERNMENT BUDGETGOVERNMENT EXPENDITURESGOVERNMENT POLICIESGOVERNMENT SPENDINGGROWTH COMPONENTGROWTH PERFORMANCEGROWTH RATESHEALTH EXPENDITURESHEALTH OUTCOMESHEALTH SECTORHEALTH SERVICESHEALTH SPENDINGHIGH GROWTHHIGH GROWTH RATEHOUSEHOLD WELFAREHUMAN CAPITALHUMAN DEVELOPMENTINCOME DISTRIBUTIONINCOME GROWTHINCOME INEQUALITYINCOME LEVELSINCOMESINCREASING INEQUALITYINDEPENDENT VARIABLEINEQUALITY OUTCOMESINFANTINFANT MORTALITYINFANT MORTALITY RATEINFRASTRUCTURE DEVELOPMENTINFRASTRUCTURE SERVICESINTEREST PAYMENTSINTERNATIONAL COMMUNITYINVESTINGKIDSLABOR FORCELABOR MARKETLABOR MARKETSLABOR SUPPLYLEVELS OF PRODUCTIVITYLIVE BIRTHSLOCAL CURRENCYLOW INCOMELOW-INCOMELOW-INCOME COUNTRIESMACROECONOMIC PERFORMANCEMALARIAMARGINAL RETURNSMATERNAL MORTALITYMATERNAL MORTALITY RATEMATERNAL MORTALITY RATESMATHMEDICAL CAREMILLENNIUM DECLARATIONMILLENNIUM DEVELOPMENT GOALSMINISTRY OF EDUCATIONMINISTRY OF FINANCEMORTALITYNATIONAL AUTHORITIESPER CAPITA GROWTHPER CAPITA INCOMEPOLICY ALTERNATIVESPOLICY IMPLICATIONSPOLICY MAKERSPOLICY RESEARCHPOLICY RESEARCH WORKING PAPERPOOR COUNTRIESPOOR HOUSEHOLDSPOPULATION GROUPSPOPULATION GROWTHPORTSPOVERTY LINEPOVERTY LINESPOVERTY REDUCTIONPRIMARY SCHOOLPRIVATE CONSUMPTIONPRIVATE INVESTMENTPRIVATE SECTORPRIVATE SECTOR GROWTHPROGRESSPUBLICPUBLIC BUDGETPUBLIC CONSUMPTIONPUBLIC EDUCATIONPUBLIC EXPENDITUREPUBLIC EXPENDITURE MANAGEMENTPUBLIC EXPENDITURE REVIEWPUBLIC EXPENDITURESPUBLIC HEALTHPUBLIC INFRASTRUCTUREPUBLIC INVESTMENTPUBLIC INVESTMENT IN INFRASTRUCTUREPUBLIC POLICYPUBLIC PROVISIONPUBLIC SAFETY NETSPUBLIC SECTORPUBLIC SECTOR EFFICIENCYPUBLIC SECTOR SERVICE DELIVERYPUBLIC SERVICEPUBLIC SERVICESPUBLIC SPENDINGPURCHASING POWERQUALITY OF EDUCATIONRATES OF GROWTHREAL EXCHANGE RATERESOURCE NEEDSRESPECTRISING DEMANDROADSRURAL AREASSAFE WATERSAFETY NETSSANITATIONSANITATION FACILITIESSANITATION SERVICESSAVINGSSCHOOL AGESCHOOL FEESSECONDARY SCHOOLSECONDARY SCHOOLSSERVICE DELIVERYSERVICE PROVISIONSKILLED WORKERSSLUM DWELLERSSOCIAL AFFAIRSSOCIAL INDICATORSSOCIAL OUTCOMESSOCIAL SERVICESOCIAL SERVICESSOCIAL SPENDINGSPILLOVERSPILLOVER EFFECTSSUSTAINABLE ACCESSTAXTAX RATETAXATIONTERTIARY EDUCATIONTOTAL COSTTOTAL COSTSTOTAL PUBLIC SPENDINGUNIVERSAL PRIMARY EDUCATIONUNSKILLED LABORUNSKILLED WORKERSURBAN AREASWAGEWAGE DIFFERENTIALSWAGE GROWTHWAGESWORKFORCEWORLD TRADEYOUNG ADULTSYOUNG CHILDRENYOUNG PEOPLEWorld Bank10.1596/1813-9450-4383