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Over the last 15 years, development economists have carefully accumulated rigorous evidence about what works and what does not in promoting health in poor countries. While each individual evaluation tests specific questions or sets of questions in specific contexts, the large number of studies now means that it is possible to draw more general conclusions. In addition, randomized evaluations are increasingly being designed to test fundamental questions about how people behave and thus generate lessons that are relevant for the design of different types of programs. In this seminar, Michael Kremer will discuss a new research paper co-authored with Rachel Glennerster, Lessons from Randomized Evaluations for Improving Health in Developing Countries, which summarizes lessons from the growing body of randomized evaluations of health programs in developing countries. The paper finds considerable evidence that consumers do not always invest optimally in health. In particular, consumers underinvest in cost-effective products for prevention and non-acute care of communicable disease and are very sensitive to the price and convenience of these products. This underinvestment does not simply reflect a lack of information of the benefits of preventative health. While this suggests the need for government intervention, many government health systems perform poorly and there is little accountability and few incentives for health care providers. Of the approaches designed to improve accountability, community or nongovernmental monitoring has had mixed results but district-level contracting has been quite successful. Many programs can improve health without excessive reliance on dysfunctional health delivery systems—delivering health products through schools for example, or improving health through water treatment.

Given a small budget, would it make sense to vaccinate 10 children against childhood diseases, or one woman to prevent transmission of HIV to her unborn child? In today’s global health arena where resources are limited and demands are growing, policy makers constantly face such budgetary dilemmas with little expert guidance. 

My guest on this week’s Wonkcast is Amanda Glassman –a research fellow and director of CGD’s global health program. Her recent report, Priority Setting in Health: Building Institutions for Smarter Public Spending, draws on the expertise of a CGD working group to offer recommendations for improving the allocation of scarce health funding, despite political and bureaucratic constraints.

Food security has been a frequent topic at G-8 and G-20 meetings ever since the food price crisis that preceded the 2008 financial markets crash. It is likely to be discussed again this month when world leaders meet in Los Cabos, Mexico for the 2012 G-20 Summit.

Among the proposals likely to be considered is one with roots in CGD research by senior fellow Kimberly Ann Elliott, my guest on this week’s Wonkcast. Kim is a leading expert on agriculture and poverty, and especially on agriculture pull funding—finance that creates incentives for research, development and delivery of agricultural technology breakthroughs.

In this week’s interview we discuss why food security has featured so prominently on the agenda of global summits; how pull funding differs from traditional approaches; how it could work for specific crops, like vitamin-A enriched sweet potatoes; and the modest scale of the pilots that may be announced at the Los Cabos Summit.

Senior Fellow Liliana Rojas-Suarez discusses the recent increased weakness of European banks. She argues that the crisis will exacerbate unless the European Central Bank (ECB) fully exercises its role as lender of last resort in the near future. Timid injections of liquidity will not do the job. In her view, however, Germany's political apparatus is not ready to support the ECB crucial role. At his point, the most likely scenario is a breakdown of the Eurozone and full-blown banking crises in a number of countries in the area.

On May 22nd, members of the Latin American Shadow Financial Regulatory Committee (CLAAF), convened at CGD to discuss some of the most pressing fiscal and monetary issues affecting Latin American economies. The result of the committee’s two-and-a-half-day-long discussion was a four page statement and several clear recommendations for rethinking financial policies in the midst of a global crisis.

Since the 2010 earthquake, $6 billion has been disbursed in official aid to help the people of Haiti. Nearly all of it has gone to intermediaries such as international non-governmental organizations (NGOs) and private contractors. Yet there has been a surprising lack of reporting on how the money has been spent. CGD senior fellow Vijaya Ramachandran and research assistant Julie Walz try to follow the money in a new CGD policy paper: “Haiti: Where Has All the Money Gone?” They joined me on this week’s Wonkcast to explain their findings.

Mead Over delivers a presentation on Achieving the AIDS Transition at a CGD book launch event.

Industrial policy—an active government role in shaping the direction of the economy—is often disdained by Western-trained economists but frequently embraced by Asian policymakers. Is it the path to development success or a slippery slope that leads to development failure? “New Structural Economics: A Framework for Rethinking Development and Policy” by World Bank chief economist Justin Lin and contributing authors provides a timely opportunity to review the evidence. Are systemic reforms to strengthen the business climate enough? How can policymakers guard against the well-known risks of favoring specific sectors or firms? Is there such a thing as a "New Industrial Policy" and can it provide useful guidelines for developing countries? This debate is of particular interest for low-income countries in Africa and elsewhere and the advice provided by their development partners.