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The World Region

Fredo or Michael? Parents play favorites among siblings

Shwetlena Sabarwal's picture

In The Godfather II, Vito Corleone chooses his younger son, Michael, instead of his older son, Fredo, as his successor. This decision is based on Michael's intelligence and ability. Fredo, who is considered weak, is dismissed to do more menial tasks for the family. This has huge implications for Michael, Fredo, and the Corleone saga. 


CC (The Godfather) Image courtesy of Insomnia Cured Here on Flickr

What makes parents decide to "invest" in one child over another? In economics, a key idea is that parents either reinforce or compensate for children’s endowments, such as health or intelligence. They reinforce by investing more in the human capital of their better-endowed children. Or they compensate by investing more in their worse-endowed children to reduce inequality among siblings. The core notion is : either parents are striving for equity (the compensating strategy) or efficiency (the reinforcing strategy of Vito Corleone).

Declining private investment in infrastructure – a trend or an outlier?

Clive Harris's picture



We’ve just released the 2016 update for the World Bank’s Private Participation in Infrastructure (PPI) Database and it makes for some gloomy reading. Investment commitments (investments) in infrastructure with private participation in Emerging Markets and Developing Economies (EMDEs) fell by a whopping 37% compared to 2015. 

Spending on bling: What explains the demand for status goods?

Martin Kanz's picture

When people spend money, their decisions are often influenced by the desire to signal wealth and attain social status. This insight is not entirely new – even Adam Smith, in the Wealth of Nations, complains that his contemporaries spend too much on “status goods” that are not a necessity of life, and which they most likely can’t afford.

Social signaling motives in consumption seem to be present in many different economic settings, and may in fact be so widespread that they can be linked to larger economic phenomena, such as inequality and persistent poverty. Studies using household surveys show, for example, that the poor around the world spend a strikingly large share of their income on visible expenditures, which may have negative implications for asset accumulation, household indebtedness, and investments in education.The same pattern has been shown to hold for ethnic minorities in the Unites States – so much so, that a recent study argues that differences in conspicuous consumption may account for as much as one third of the wealth gap between Whites and African Americans

Four policy approaches to support job creation through Global Value Chains

Ruchira Kumar's picture
 Maria Fleischmann / World Bank

Mexico created over 60,000 jobs between 1993 to 2000 upgrading the apparel value chain from assembly to direct distribution to customers.  (Photo: Maria Fleischmann / World Bank)

As we discussed in our previous post, Global Value Chains can lead to the creation of more, inclusive and better jobs. GVCs can be a win-win for firms that create better jobs while they enjoy greater efficiency, productivity, and profits. However, there is a potential trade-off between increasing competitiveness and job creation, and the exact nature of positive labor market outcomes depends on several parameters. Given the cross-border (and, therefore, multiple jurisdictive) nature of GVCs, national policy choices to strengthen positive labor outcomes are limited. However, national governments can make policy decisions to facilitate GVC participation that is commensurate with positive labor market outcomes.

Global Partnership announces new round of funding for ‘Collaborative Data Innovations for Sustainable Development’

World Bank Data Team's picture
Claire Melamed of the GPSDD & Mahmoud Mohieldin of the World Bank at the High Level Political Forum 2017

Following a successful round of pilot funding for development data innovation projects last year, the Global Partnership for Sustainable Development Data (GPSDD) has announced a second funding round for data for development projects, to open on August 1st 2017.

As part of the ‘Collaborative Data Innovations for Sustainable Development’ funding, which is supported by the World Bank’s Trust Fund for Statistical Capacity Building (TFSCB), GPSDD will seek innovative proposals for data production, dissemination and use.

This year’s call is anchored around two themes: ‘Leave No One Behind’ and the Environment. Once again, the focus is on work supporting low and lower-middle income countries, and on projects that bring together collaborations of different stakeholders to address concrete problems.

The new round of funding was announced by GPSDD’s Executive Director Claire Melamed at a High-Level Political Forum Event ‘Leave No One Behind: Ensuring inclusive SDG progress’ at United Nations HQ in New York. She said:

“There was a fantastic response to ‘Collaborative Data Innovations for Sustainable Development Pilot Funding’ last year, with 400 proposals, from which 10 outstanding ideas were selected. This year we are opening a new round to source innovative projects to protect the environment and ‘Leave No One Behind’.  For the 2017 round we are raising the bar even higher by asking applicants to collaborate from the outset, providing evidence of support from an organisation that is a potential end user. With a wealth of data innovation talent out there, we are excited to see who comes forward.”

The World Bank’s Senior Vice President for the 2030 Development Agenda, United Nations Relations, and Partnerships, Mahmoud Mohieldin, added:

Innovation work doesn't happen in isolation, it requires a network of ideas, individuals and institutions to come together to be more than a sum of their parts. We’ve found this network in the Global Partnership for Sustainable Development Data, and are pleased to be working together to identify and support new ideas to change the way development data are produced, managed and used.”  
 

Application Details and Funding Levels

Why addressing FX risk could hold the key to infrastructure investment

Julie Monaco's picture


Photo: Japanexperterna | Flickr Creative Commons

The world is crying out for new infrastructure. In emerging market countries, growing populations and rapid urbanization mean that cities are struggling to keep pace with the needs of citizens. Meanwhile, infrastructure is outdated in many developed countries.

Yet there is a $1 trillion annual shortfall in infrastructure investment, mostly in emerging markets. At the same time, there are billions of dollars in debt capital seeking secure and healthy returns.

Given the long-term, stable cash flows of many infrastructure projects, it seems the perfect destination for such capital. But in large part, this investment is not taking place. What is stopping investors’ capital connecting with infrastructure projects around the world? What will it take to increase the supply ‎of well-structured projects?

What’s challenging women as they seek to trade and compete in the global economy

Anabel Gonzalez's picture
The World Bank Group’s Trade & Competitiveness Global Practice is front and center in supporting our corporate Gender Strategy for 2016 to 2023. The strategy defines the level and type of support that the Bank Group is committed to provide to its client countries and firms to achieve greater gender equality.

Rejuvenating regionalism

Aaditya Mattoo's picture

Regionalism can have three dimensions:  trade integration, regulatory cooperation and infrastructural coordination.  In a thought provoking blog, Shanta Devarajan argues for a drastic shift in focus, away from trade and towards infrastructure.

Regional trade agreements do sometimes divert not just trade but attention from other beneficial forms of cooperation.  And what type of integration makes economic and political sense, in what sequence, differs across regions. But it would be wrong to exclude trade, to focus only on one dimension, and to ignore important new constraints and old questions.

Water Get Enemy: A graphic novel on governance

Daniel Rogger's picture
Story by Daniel Rogger. Graphic by Albert Ohams


This blog post is part of a series for the 'Bureaucracy Lab', a World Bank initiative to better understand the world's public officials.

“Why? Why do we always fail the people of this country?” So reflects the public official who plays the hero in my graphic novel on governance in the developing world. The story, set in fictional Zanzarim, follows the struggles of the ‘Director’ up to that point, as he labours to implement policy that will help his fellow citizens. His exhausting — and frequently unsuccessful — attempts to succeed mirror the many such struggles I have witnessed in the governments of developing countries across the world.
 

WTO TFA implementation: Learning from early results

Bill Gain's picture
The World Trade Organization’s Trade Facilitation Agreement (TFA) spearheads a global effort to reduce trade costs, helping countries to connect to the global economy. Many countries have already made progress towards implementation of the TFA provisions, with support from the World Bank Group, the WTO, and other partners.
 

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