Staff update of the 2011 report Beyond Bullets and Bombs: Fixing the US Approach to Development in Pakistan, based on the deliberations of the CGD Study Group on a US Development Strategy in Pakistan.
For all of its attractions, the charter city model – and the Honduran plan in particular – still faces significant challenges before it can muster the kind of widespread support from potential partners it needs to succeed. What follows are three big questions we think supporters of the new Honduran city need to address, and two ways to do so.
In developing countries where elections are costly and accountability mechanisms weak, politicians often turn to illicit means of financing campaigns. This paper examines one such channel of illicit campaign finance: India’s real estate sector. Politicians and builders allegedly engage in a quid proquo, whereby the former park their illicit assets with the latter, and the latter rely on the former for favorable dispensation. At election time, however, builders need to re-route funds to politicians as a form of indirect election finance. One observable implication is that the demand for cement, the indispensible raw material used in the sector, should contract during elections since builders need to inject funds into campaigns. Using a novel monthly-level data set, we demonstrate that cement consumption does exhibit a political business cycle consistent with our hypothesis. Additional tests provide confidence in the robustness and interpretation of our findings.
This new collection of essays sets an agenda for increased American effectiveness in dealing with failed states to promote economic development and international security. It includes an overview of the poorly understood challenge of weak and failed states and case studies by regional policy experts, then offers recommendations for reform of U.S. foreign and development policy to better meet the challenges posed by weak states.