CGD in the News

This Picture Tells You Everything You Need to Know About Global Inequality (Washington Post)


Well, their best bet is immigration, legal or otherwise. Not to belabor the obvious here, but where you live determines how much you can make. The same person with the same education and the same skills can make seven times more working in the United States than in Haiti, according to economists Michael Clemens, Claudio Montenegro, and Lant Pritchett. Or, to give another example, you can make more than 10 times as much for doing the same job in an American McDonald's as you can in an Indian one. That's why looser immigration laws are actually one of the best things we could do to fight global poverty.

Ebola Fears Dragging Down African Economies (The Global and Mail)


“The epidemic is moving faster than we economists can work,” said a blog last week by World Bank senior economist David Evans and Center for Global Development senior fellow Mead Over.

“The latest information suggests that even the World Bank’s ‘High Ebola’ scenario may be optimistic,” they said. They cited especially the effect of “aversion behaviour” – the fear factor that leads to closed borders, reduced trade, suspended airline flights and the curtailing of commercial activities by multinational companies in West Africa.

The latest Ebola cases in Spain and Dallas “generate aversion behaviour towards Africa which threatens to persist and damage African economic growth for years to come,” the two economists said.

Child Labor Is Still Prevalent Around the World. Here's How to Eliminate It (Bloomberg Businessweek)


It isn’t easy to end child labor in poor countries. In fact, passing laws banning anyone under 14 or 16 from working can actually make the problem worse. If we are going to sustainably reduce the level of child labor worldwide, we need to provide parents the resources so they can make the choice to keep children out of the factory or field and send them to school instead.

Did We Neglect Ebola Because It Was In Africa? (MSNBC The Cycle)


“If your neighbor’s bathtub was leaking, would you go help them fix the leak, or would you try to paint rubber walls or something? It would make no sense. And the way we are really going to contain Ebola is at the source…what we need now is a surge of health workers.”

Larry Summers Explains Why the World is Too Optimistic About China’s Economic Future (Quartz)


Imagine you’re a doctor and someone hands you the chart of a 60-year-old man, asking you to predict the patient’s health for the next decade. The guy is a probiotic-eating marathon runner and his cholesterol numbers look great. Still, your prediction will likely give more weight to the average health outcomes of sexagenarians than to the patient’s pristine individual health.

But when it comes to predicting China’s medium- and long-term growth, economists are chucking that wisdom out the window, argue former US Treasury secretary Larry Summers and Harvard University professor Lant Pritchett in a new National Bureau of Economic Research paper (registration required).

As a result, they say, even the more cautious economic forecasts for China are overestimating the country’s growth prospects. Summer and Pritchett’s calculations, using global historical trends, suggest China will grow an average of only 3.9% a year for the next two decades. And though it’s certainly possible China will defy historical trends, they argue that looming changes to its  authoritarian system increase the likelihood of an even sharper slowdown.

Un-Cooking Africa's Books (National Geographic)


A July report from the Data for African Development Working Group found that most national statistics offices in Africa lack reliable funding and, in fact, depend on aid donors for their budgets. The aid donors are generally happy to fund their statistical priorities, like household surveys, but not so keen on national statistic "building blocks" like births and deaths, growth and poverty, and taxes and trade. Governments aren't stepping in. Still you can't insulate data from politics, the report argues. "To the extent that data is used to hold people accountable, it will be misreported," says Amanda Glassman, an author of the report and a researcher at the Center for Global Development, a think tank in Washington, D.C. Another study she co-authored this summer found that across Africa, when school administrators are paid by the pupil, they report higher enrollment rates. Surprise, surprise.

Modi Names Rajan Ally Subramanian as Chief Economic Adviser (Reuters)


"I have just taken charge as chief economic adviser," Subramanian told reporters outside the finance ministry. "It is a great honour ... to serve in a government that has a mandate for reform and change."

Setting out his priorities, Subramanian said: "For any economy like India, two big things are macro-economic stability and, of course, creating the conditions for rapid investments and growth."

Subramanian Named Chief Economic Adviser to Indian Finance Ministry (Wall Street Journal)


Mr. Subramanian, a former International Monetary Fund economist, has most recently worked as senior fellow at the Peterson Institute for International Economics and the Center for Global Development, two Washington think-tanks.

“For any economy like India, the two big things are macroeconomic stability and creating the conditions for rapid investment and growth while of course creating opportunities for all segments of society,” Mr. Subramanian told reporters in New Delhi on Thursday.

Why Private Donations Aren’t Helping America’s Poor (Bloomberg Businessweek)


Despite seemingly high levels of government spending, the U.S. safety net is much less efficient than other countries’ at raising poor people out of poverty. U.S. taxation and transfer policy does less to reduce inequality than any other OECD country apart from South Korea, Switzerland and Chile. The U.S. is the tenth most unequal country in terms of income in the OECD before taxes and transfers are taken into account.  After taxes and transfers, the U.S. rises to fourth most unequal, behind only Turkey, Chile and Mexico.

Why the World is Getting Better (Christian Science Monitor)


Amid the swathe of spectators who harp on the failures of global development stands one economist who begs to differ: Charles Kenny.

Kenny argues that global development is actually succeeding – and he has the data to prove it.

A senior fellow at the Center for Global Development, columnist for BusinessWeek, and contributing editor to Foreign Policy, Kenny spent more than 20 years researching growth patterns as a researcher for the World Bank.

His conclusion? Income isn’t a catch-all mechanism that explains why certain countries lag behind others. But we can clearly see things are getting better.