With rigorous economic research and practical policy solutions, we focus on the issues and institutions that are critical to global development. Explore our core themes and topics to learn more about our work.
In timely and incisive analysis, our experts parse the latest development news and devise practical solutions to new and emerging challenges. Our events convene the top thinkers and doers in global development.
Foreign direct investment, financial flows, private-sector development, humanitarian assistance, Africa
Vijaya Ramachandran is a senior fellow at the Center for Global Development. She works on the impact of the business environment on the productivity of firms in developing countries, and is the coauthor of an essay titled "Development as Diffusion: Manufacturing Productivity and Africa's Missing Middle,” published in the Oxford Handbook on Economics and Africa. Vijaya is also studying the unintended consequences of rich countries’ anti-money laundering policies on financial inclusion in poor countries. She has published her research in journals such as World Development, Development Policy Review, Governance, Prism, and AIDS and is the author of a CGD book, Africa’s Private Sector: What’s Wrong with the Business Environment and What to Do About It. Prior to joining CGD, Vijaya worked at the World Bank and in the Executive Office of the Secretary-General of the United Nations. She also served on the faculties of Georgetown University and Duke University. Her work has appeared in several media outlets including the Economist, Financial Times, Guardian, Washington Post, New York Times, National Public Radio, and Vox.
Why do so many businesses choose to remain informal? Vijaya Ramachandran and co-authors discover that the answer is more nuanced than often believed. In East Africa, for instance, the difference in productivity between formal and informal firms is often indistinguishable, while in Southern Africa productivity it is more differentiated. Policies to encourage formalization and increase productivity are likely to be more successful in East Africa, whereas an emphasis on job training and vocational skills might be more appropriate in Southern Africa.
The UN’s Food and Agricultural Organization (FAO) recently reported that the December 2010 Food Price Index surpassed the peak reached in June 2008. A closer examination of the data, however, provides some modest hope that the worst effects of the 2007-08 price spikes can be avoided, with luck and better policies.
First, it is important to note that only two of the five components of the Food Price Index were above 2008 levels—meat (slightly above) and sugar (more than twice as high). Second, as shown in the chart below, staple grain prices, which are key to preventing hunger among the poor, are increasing sharply, while rice and, to a lesser degree, wheat remain well below their 2008 peaks. Maize is the exception, thanks in part to U.S. policies supporting corn-based ethanol that bring to mind the zombies populating popular culture—they just won’t die!
Moving from the clearly obsolete G-7 to a broader group that reflects the reality of today’s world makes eminent sense. Doing it on the basis of a grouping improvised during the crisis-before-last (and making sure that it included the then-favorite finance ministers of the U.S. and Canadian sponsors) is squandering the opportunity to move up to a credible, transparent, global governance platform.
Last week, the G-20 agriculture ministers meeting in Paris issued a communiqué calling for the World Food Programme to develop hedging strategies to purchase food. In a little-noticed section towards the end of a 24-page document, the ministers stated:
We invite the multilateral, regional and national development banks or agencies to further explore, in connection with the private sector as appropriate:
Development of hedging strategies that could help international humanitarian agencies, in particular WFP, to optimize food procurements and maximize the purchasing power of financial resources, building upon forward purchase… (Annex 5)