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Begin New Search Topic Development Content Type Working Paper Publishing Institution The John F. Kennedy School of Government at Harvard University Publication Year within 10 Years Publication Year within 25 Years

1. How Pratham Learns While Scaling: A Case Study of Adaptive Design and Evaluation

Author:
Jossie Fahsbender, Siddhant Gokhale, and Michael Walton
Publication Date:
11-2023
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Developing scalable innovations is a central challenge in development. Organizations that succeed in scaling often prioritize measurement, learning, and evaluation, but how this is done is poorly understood. This paper explores the case of Pratham, one of the largest NGOs in primary education and an exceptional learning organization. While Pratham is renowned for its randomized control trial sequence with J-PAL, we underscore this is just one aspect of a wider array of learning activities. These include an iterative process to continuously refine and protocolize solutions as they scale, the use of on-field qualitative insights and quantitative tracking, open feedback channels between the field, state, and central offices, information exchange among content and evaluation teams, and a nationwide assessment of learning levels (ASER). The RCTs were effective because they were embedded within this broader learning process and culture. Pratham learns at three levels: learning to improve children's basic skills, learning as an organization about what does and doesn’t work, and fostering learning by others in the system. Its learning capacity is rooted in deep-seated values and a culture of openness, trust, problem-solving, and the freedom to experiment and learn from failure, inculcated and nurtured by its leadership. Throughout, we use the prism of an Adaptive Evaluation to provide a systematic framework for mirroring and understanding Pratham's organic learning processes (as affirmed by its own leadership). Pratham actively engages with the three main pillars of an Adaptive Evaluation, involving understanding systems, theorizing how to effect change, and iterating its designs. While Pratham’s culture will often not be transferable, the systematic analysis of how Pratham learns can provide a framework for other organizations aspiring to replicate Pratham's success as a learning institution.
Topic:
Development, Economy, Innovation, and Adaptation
Political Geography:
Global Focus

2. Housing in Wyoming: Constraints and Solutions

Author:
Thảo-Nguyên Bùi, Tim Freeman, Ricardo Hausmann, Farah Kaddah, Lucas Lamby, Tim O'Brien, and Eric Protzer
Publication Date:
04-2023
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Quantitative evidence supports the contention that Wyoming’s housing market is constrained, to a greater degree than many other parts of the US. Prices are persistently above expectations given economic fundamentals in most parts of the state, and the supply of new housing in Wyoming is on average less responsive to price increases than in other US counties. This has undermined natural population growth and contributed to a low amount of population density close to city centers in Wyoming, as compared to other US cities with comparable population levels. Importantly, this phenomenon is not simply the result of pandemic-era economic frictions. The evidence shows that these constraints have durably persisted in Wyoming. This housing constraint weighs heavily on the broader Wyoming’s economy, and chokes off growth in new industries that could add to the Wyoming economy beyond its natural resource base. Businesses consistently report a lack of access to workforce as a leading problem that ultimately results from a lack of housing. Some businesses have even tried to create their own housing for employees, and news reports abound of teachers and nurses who secure jobs in Wyoming communities but then have to leave because they cannot find housing. Key problems behind Wyoming’s housing constraints include excessive regulations concerning housing density and insufficient investment in arterial infrastructure. For example, there is evidence that over-regulated minimum lot sizes in Wyoming are blocking the creation of supply to match free-market demand for houses with smaller amounts of land. Other areas of over-regulation include those concerning allowable housing types, building height, parking spaces per dwelling, and the housing approval process itself. This may be seen as surprising given Wyoming’s reputation as a low-regulation state, but Wyoming maintains restrictions that other states and countries have discarded as outdated and highly counterproductive. Besides outright restrictions on housing development, we find that the most common cost driver undermining the housing development has to do with low public investment in needed arterial infrastructure, especially water systems. Land supply as well as material and construction costs are not primary constraints to housing development across the state, but may matter for select communities. We suggest a portfolio of policy changes for the state of Wyoming to explore in order to solve its housing constraints. One category of changes is regulatory, and focuses on deregulation, reducing bureaucratic overhead, and shifting from veto-cratic to democratic housing approval procedures. Another category is focused on investment on infrastructure to support housing, and exploration of state-local funding structures to facilitate continuous infrastructure improvement. If implemented, these changes will not only help to solve Wyoming’s housing constraints but also facilitate housing development in a way that combats urban sprawl, and in doing so protects open spaces outside of cities that Wyomingites value.
Topic:
Development, Economics, Public Policy, and Housing
Political Geography:
North America and United States of America

3. Process and Implementation Evaluations: A Primer

Author:
Patricia J. Rogers and Michael Woolcock
Publication Date:
05-2023
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Beyond assessing whether or not interventions have achieved their stated goals, evaluations can also provide greater understanding—in real-time and at completion—about how, where, for whom, over what time frame, and which aspects of an intervention may (or may not) have succeeded, and thus where improvements might be sought. Moreover, to the extent any intervention is only as good as its implementation, evaluations can also help identify where breakdowns in the delivery system may have occurred and spaces wherein frontline implementers were able to find innovative solutions to local (“binding constraint”) problems. Process and implementation evaluations thus serve the vital purpose of jointly promoting accountability and learning, thereby expanding the common perception of evaluations as external instruments of compliance and discipline to internal procedures for promoting partnerships, innovation, and improvement (organizationally or technically). In this chapter, we describe six different types of process and implementation evaluations and describe their respective strengths and weaknesses in various contexts, for various purposes. As part of collective efforts to enhance the effectiveness of all classes of interventions, impact and process evaluations should be regarded as necessary complements.
Topic:
Development, Accountability, and Intervention
Political Geography:
Global Focus

4. Facilitating learning and discovery oriented industrial policy in Albania

Author:
Matt Andrews and Peter Harrington
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Industrial policy initiatives demand a lot of knowledge from policymakers. Knowledge is often limited, however, especially when policies emerge from top-down technical experts or outsiders with limited contextual experience. Such policies are prone to mistakes. These can, however, be avoided by developing policies through collaborative ‘discovery processes’. Establishing organizations to do ‘discovery’ work is challenging, however, especially when challenges are urgent, resources lacking, and corruption concerns rife. In such settings, it may be more practical and effective to build listening and response capabilities into incumbent policy systems through rapid, temporary discovery processes. This paper provides a case narrative of an experiment with this idea, recounting the story of a problem-driven learning and discovery-oriented approach undertaken to reinvigorate a struggling sector in Albania in 2014.
Topic:
Development, Industrial Policy, Economy, and Business
Political Geography:
Eastern Europe and Albania

5. What is public policy success, especially in development?

Author:
Matt Andrews
Publication Date:
09-2022
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Public policy work is hard, especially when one works in developing countries. It is even difficult to define what success looks like, and thus how to manage towards success. Literature helps manage such difficulty, providing studies that define the concept and show how it can be achieved. A core message from such is that success is multi-dimensional, and practitioner need to focus on multiple criteria when doing their policy work. But what dimensions and criteria matter? And do development practitioners really adopt this multi-dimensional view? Tackling such questions, the current paper reviews 45 applied studies from the public policy, project management and development evaluation literatures to see what they identify as key success criteria and if the practical studies (about development evaluation) are in sync with the more academic messages. Reading across all three literatures, I identify 30 potential success criteria in 6 categories or dimensions (program, impact and endurance, capability, political, stakeholder, and process). I find that the development evaluation literature focuses on a narrow set of 7 criteria, mostly in one dimension (program success) as compared to broader perspectives in the other literatures. This suggests that development practitioners have a narrow view on success, which is out of step with academic views on the topic. A conclusion proposes a broader approach for these practitioners.
Topic:
Development, Public Policy, and Project Management
Political Geography:
Global Focus

6. The Economic Complexity of Namibia: A Roadmap for Productive Diversification

Author:
Ricardo Hausmann, Miguel Angel Santos, Douglas Barrios, Nikita Taniparti, Jorge Tudela Pye, and Jessie Lu
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
After a large growth acceleration within the context of the commodity super cycle (2000- 2015), Namibia has been grappling with three interrelated challenges: economic growth, fiscal sustainability, and inclusion. Accelerating technological progress and enhancing Namibia’s knowhow agglomeration is crucial to the process of fostering new engines of growth that will deliver progress across the three targets. Using net exports data at the four-digit level, we estimate the economic complexity of Namibia – a measure of knowhow agglomeration – vis-à-vis its peers. Our results suggest that Namibia’s economy is relatively less complex and attractive opportunities to diversify tend to be more distant. Based on economic complexity metrics, we define a place-specific path for productive diversification, identifying industries with high potential and providing inputs – related to their feasibility and attractiveness in Namibia – for further prioritization. Namibia’s path to structural transformation will likely be steeper than for most peers, calling for a more active policy stance geared towards progressive accumulation of productive capacities, well-targeted “long jumps”, and strengthening state capacity to sort out market failures associated with the process of self-discovery.
Topic:
Development, Economy, Economic Complexity, and Industry
Political Geography:
Africa and Namibia

7. Managing for Motivation as Public Performance Improvement Strategy in Education & Far Beyond

Author:
Dan Honig
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
People management has an important role to play in improving public agency performance. This paper argues that a ‘Route Y’ managerial approach focused on supporting the empowered exercise of employee judgment will in many circumstances prove superior to conventional reform approaches steeped in ‘Route X’ monitoring and incentives. Returns to Route Y are greater when employees are or can become more “mission motivated” – that is, aligned with the goals of the agency in the absence of monitoring and extrinsic incentives. Returns to Route Y are also greater when monitoring is incomplete or otherwise likely to unproductively distort effort, thus lowering the returns to using performance-linked rewards and penalties. I argue that education systems are one (but far from the only) setting where Route Y is a lever worth focusing on in efforts to improve public performance in the developed and developing world alike.
Topic:
Development, Education, Public Policy, Performance Evaluation, and Project Management
Political Geography:
Global Focus

8. A Growth Diagnostic of Namibia

Author:
Ricardo Hausmann, Miguel Angel Santos, Douglas Barrios, Nikita Taniparti, Jorge Tudela Pye, Jose Francisco Muci, and Jessie Lu
Publication Date:
02-2022
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
In the thirty years that have passed since independence, Namibia has been characterized by its over-reliance on its mineral resource wealth, procyclicality of macroeconomic policy, and large income disparities. After an initial decade marked by nation building and slow growth (1990-2000), the Namibian economy embarked on a rapid growth acceleration that lasted 15 years, within the context of the global commodity super cycle. Favorable terms of trade translated into an investment and export boom in the mining sector, which was amplified to the non-tradable sector of the economy through a significant public expenditure spree from 2008 onwards. Between 2000 and 2015 income and consumption per capita expanded at an average annual rate of 3.1%, poverty rates halved, and access to essential public goods expanded rapidly. As the commodity super cycle came to an end and the fiscal space was exhausted, Namibia experienced a significant reversal. Investment and exports plummeted, bringing GDP per capita to contract by 2.1% between 2015-2019. With debt-to-GDP ratios 3.5 times higher than those in 2008, the country embarked on a fiscal consolidation effort which brought the primary fiscal deficit from 6.8% of GDP in 2016 to 0.6% by March 2020. Along all these years, inequality has been endemic and is reflected across demographic characteristics and employment status. At present, a large majority of Namibians are unable to access well-paying formal sector jobs, as these tend to be particularly scarce outside of the public sector. Looking forward, the road to sustained inclusive growth and broad prosperity entails expanding the formal private labor market by diversifying the Namibian economy, while at the same time removing the barriers preventing Namibians from accessing these opportunities inherited from the apartheid.
Topic:
Development, Economy, Economic Growth, Inclusion, and Skills
Political Geography:
Africa and Namibia

9. A Survey of Importers: Results of a Survey Conducted in Collaboration with the Ethiopian Economics Association

Author:
Ricardo Hausmann, Tim O'Brien, Tim Cheston, Nikita Taniparti, and Ibrahim Worku Hassen
Publication Date:
11-2022
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Ethiopia suffers from a chronic shortage of foreign exchange (forex).[1] The resulting lack of access to imports prevents firms from accessing imported inputs required for production. This creates a vicious cycle as exporters are constrained by this same problem, which further reduces overall supply of foreign exchange in the Ethiopian economy. The inability to reliably access foreign exchange for imports affects firm decisions on sourcing, capacity, and output. While the cost of this constraint is known to be high on the Ethiopian economy and firms are known to use a range of measures to attempt to bypass this constraint, quantitative assessments of the problem and response actions by firms are limited. It is in this context that an importer survey was conducted with the goal of informing policy decisions. A total of 202 firms with an active importing license were interviewed in March-April 2022. These firms were randomly sampled from firms registered with an importer license. All firms interviewed reported that they were operating below capacity, often well below capacity. Foreign exchange shortages were the main reason respondent firms cited for not operating at full capacity (63% of firms reporting this as their biggest constraint). Forex shortages far surpass the second and third reasons cited for not operating at full capacity — constraints due to the conflict (13%) and COVID-19 restrictions (11%). Firms operating below capacity cited forex shortages as the main constraint, regardless of whether they imported or not in the previous year. This was the most pressing constraint reported by firms of all sizes and sectors surveyed. It was the most pressing constraint faced by exporters and by foreign-owned firms as well as non-exporters and domestic firms. Amongst the total sample of firms with a renewed importer license, more than one-third of respondent firms (37%) had not imported in FY2020-21. Overall, 74% of firms reported experiencing challenges in accessing forex. Access to forex was reported as most challenging for manufacturing firms and smaller firms but impacted all sectors and firm sizes. The losses attributed to forex scarcity at the firm level were largest for agricultural firms, for micro-firms, and for firms that did not import at all in the previous year. In general, the larger the firm sales, the higher the likelihood that they were able import. The survey found different types of imports for different sectors. Manufacturing firms imported a large share semi-finished goods as imports as compared to agricultural firms that primarily imported finished goods. The survey results find that foreign exchange shortages and an inability to import are most severe for the manufacturing and agriculture sectors, small and micro-sized firms, and all non-exporters. However, the constraint is also the top problem facing all firm types in the survey, including exporters and foreign-owned firms. The primary means of accessing foreign exchange where it did occur was through specialized forex accounts or ‘diaspora’ accounts. The second most common means of accessing foreign exchange was through retention accounts available to exporters. The black market featured in many responses, but questions across the survey suggest that self-reported use of the black market by survey participants is underreported versus actual usage. The ability to source foreign exchange differed significantly by firm size. Exporting firms primarily used retention account earnings, as compared to non-exporters, which relied more on forex accounts. For faster access to forex, most firms reported that they approach banks, followed by turning to the black market. Friends and family abroad also served as a source of forex for one-quarter of firm respondents, and that foreign exchange was often used immediately. Foreign exchange access from banks is nevertheless a major pain point for firms. Most firms (55%) requested forex from a bank in the past year. On average, fulfilled forex requests took three months to be processed when they were fulfilled, but many firms reported that they have an unfulfilled request that has been in the system for more than a year. These firms are especially likely to report foreign exchange access as their top challenge. The survey finds that individual firms do not tend to use both official and black-market foreign exchange sources but rather tend to access all their forex at the (lower) official rate or all at the (higher) black-market. Large firms import most of their products at the official rate. By contrast, most small and micro firms import through other means. Manufacturing firms are also more likely to import all their production through other means and outside of the banking system. Non-exporting firms tended to import through other means than the official rate and outside of the banking system at a higher prevalence than exporting firms. The survey gleaned new insights on the implicit exchange rate that firms face as they navigate official and black-market channels of foreign exchange access. The survey does not allow for a precise estimate of the transaction-weighted exchange rate facing the economy but finds firm-level estimates align with previous macro-level estimates. The implicit exchange rate was higher for non-exporting firms, which show a greater willingness to pay a higher exchange rate to access imports. This signals the importance of the retention account for exporters to guarantee an import price closer to the official exchange rate. When asked about the maximum rate firms would pay to guarantee access to forex, some groups of firms were willing to pay higher amounts, including all non-exporters, firms that imported in the past year, and those that declared forex access a challenge. When compared to the implied rate they paid in the past year, many firms are willing to pay more than the implied rate to guarantee access to forex. Firm perspectives on policy changes to the exchange rate underscored challenges faced by policymakers. Current policy has been one of a crawling peg, with changes within the last several years to increase the rate of devaluation. The survey asked respondents about their support for faster devaluation, for a one-off movement to unify the official rate with the black-market rate, or about alternative exchange rate systems such as a floating exchange rate. Most respondents (71%) opposed maintaining the current regime, yet no option received majority support. Most firms appear to want both a stronger exchange rate and easier access to foreign exchange despite a tradeoff between these two priorities. The largest share of support for policy change was to adjust the exchange rate such that the official rate matches the black-market rate.
Topic:
Development, Economics, Imports, and Collaboration
Political Geography:
Africa and Ethiopia

10. Development in a Complex World: The Case of Ethiopia: A Compendium of Project Research on Advancing Economic Diversification in Ethiopia

Author:
Ricardo Hausmann, Tim O'Brien, Tim Cheston, Ibrahim Worku Hassen, and Can Soylu
Publication Date:
11-2022
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
This research compendium provides an explanation of Ethiopia’s fundamental economic challenge of slowing economic growth after an exceptional growth acceleration — a challenge that has been compounded by COVID-19, conflict, and climate change impacts. Ethiopia has experienced exceptional growth since the early 2000s but began to see a slowdown in the capacity of the economy to grow, export, and produce jobs since roughly 2015. This intensified a set of macroeconomic challenges, including high, volatile, and escalating inflation. This compendium identifies a path forward for more sustainable and inclusive growth that builds on the government’s Homegrown Economic Reform strategy. It includes growth diagnostics and economic complexity research as well as applications to unpack interacting macroeconomic distortions and inform diversification strategies. Drawing on lessons from past success in Ethiopia and new constraints, this compendium offers insights into what the Government of Ethiopia and the international community must do to unlock resilient, post-conflict economic recovery across Ethiopia. The research across the chapters of this compendium was developed during the Growth Lab’s research project in Ethiopia from 2019 to 2022, supported through a grant by the United States Agency of International Development (USAID). This research effort, which was at times conducted in close collaboration with government and non-government researchers in Ethiopia, pushed the boundaries of Growth Lab research. The project team worked to understand to intensive shocks faced by the country and enable local capability building in the context of limited government resources in a very low-income country. Given the value of this learning, this compendium not only discusses challenges and opportunities in Ethiopia in significant detail but also describes how various tools of diagnostic work and economic strategy-building were used in practice. As such, it aims to serve as a teaching resource for how economic tools can be applied to unique development contexts. The compendium reveals lessons for Ethiopian policymakers regarding the country’s development path as well as numerous lessons that the development community and development practitioners can learn from Ethiopia.
Topic:
Development, Economic Growth, Diversification, and Structural Transformation
Political Geography:
Africa and Ethiopia

11. Growth Perspective on Western Australia

Author:
Ricardo Hausmann, Douglas Barrios, Ana Grisanti, Semiray Kasoolu, Tim O'Brien, Eric Protzer, Rushabh Sanghvi, Nikita Taniparti, and Jorge Tapia
Publication Date:
04-2021
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
The Government of Western Australia (WA), acting through its Department of Primary Industries and Regional Development (DPIRD), invited the Growth Lab of the Center for International Development at Harvard University to partner with the state to better understand and address constraints to economic diversification through a collaborative applied research project. The project seeks to apply growth diagnostic and economic complexity methodologies to inform policy design in order to accelerate productive transformation, economic diversification, and more inclusive and resilient job creation across Western Australia. As its name implies, this Growth Perspective Report aims to provide a set of perspectives on the process of economic growth in WA that provide insights for policymakers toward improving growth outcomes. This Growth Perspective Report describes both the economic growth process of Western Australia — with a focus on the past two decades — and identifies several problematic issues with the way that growth has been structured. In particular, this report traces important ways in which policies applied during the boom and subsequent slowdown in growth over the last twenty years have exacerbated a number of self-reinforcing negative externalities of undiversified growth. The report analyzes three key channels through which negative externalities have manifested: labor market imbalances, pro-cyclicality of fiscal policy, and a misalignment of public goods. The report includes sections on each of these channels, which provide perspectives on the ways in which they have hampered the quality of growth and explore the reasons why problematic externalities have become self-reinforcing. In some cases, new issues have emerged in the most recent iteration of WA’s boom-slowdown cycle, but many issues have roots in the long-term growth history of WA.
Topic:
Development, Employment, Economic Growth, and Diversification
Political Geography:
Australia

12. Economic Complexity Report for Western Australia

Author:
Ricardo Hausmann, Eric Protzer, Jorge Tapia, and Ana Grisanti
Publication Date:
04-2021
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
The Government of Western Australia (WA), acting through its Department of Primary Industries and Regional Development (DPIRD), invited the Growth Lab of the Center for International Development (CID) at Harvard University to partner with the state to better understand and address constraints to economic diversification through a collaborative applied research project. The project seeks to apply growth diagnostic and economic complexity methodologies to inform policy design in order to accelerate productive transformation, economic diversification, and more inclusive and resilient job creation across Western Australia. This Economic Complexity Report is organized in six sections, including this brief introduction. Section 2 explains the methodology of economic complexity, including its theoretical foundations and main concepts, as well as the adjustments that were required to obtain the required export data at a subnational level and incorporate the service sector to the analysis. Section 3 describes the structure of the WA economy, identifying its productive capacities and exploring its complexity profile. This is done at the state, regional, and city levels. Section 4 identifies industries with high potential and organizes them into groupings to capture important patterns among the opportunities. Section 5 contextualizes the opportunities further by identifying relevant viability and attractiveness factors that complement the complexity metrics and consider local conditions, as well as a criterion for regional participation in the state-wide diversification strategy. Finally, Section 6 summarizes the main findings of this report and discusses implications for Government of WA strategy and policy toward capitalizing on these revealed opportunities.
Topic:
Development, Economics, Economic Complexity, and Job Creation
Political Geography:
Australia

13. Let’s Take the Con Out of Randomized Control Trials in Development: The Puzzles and Paradoxes of External Validity, Empirically Illustrated

Author:
Lant Pritchett
Publication Date:
05-2021
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
The enthusiasm for the potential of RCTs in development rests in part on the assumption that the use of the rigorous evidence that emerges from an RCT (or from a small set of studies identified as rigorous in a “systematic” review) leads to the adoption of more effective policies, programs or projects. However, the supposed benefits of using rigorous evidence for “evidence based” policy making depend critically on the extent to which there is external validity. If estimates of causal impact or treatment effects that have internal validity (are unbiased) in one context (where the relevant “context” could be country, region, implementing organization, complementary policies, initial conditions, etc.) cannot be applied to another context then applying evidence that is rigorous in one context may actually reduce predictive accuracy in other contexts relative to simple evidence from that context—even if that evidence is biased (Pritchett and Sandefur 2015). Using empirical estimates from a large number of developing countries of the difference in student learning in public and private schools (just as one potential policy application) I show that commonly made assumptions about external validity are, in the face of the actual observed heterogeneity across contexts, both logically incoherent and empirically unhelpful. Logically incoherent, in that it is impossible to reconcile general claims about external validity of rigorous estimates of causal impact and the heterogeneity of the raw facts about differentials. Empirically unhelpful in that using a single (or small set) of rigorous estimates to apply to all other actually leads to a larger root mean square error of prediction of the “true” causal impact across contexts than just using the estimates from non-experimental data from each country. In the data about private and public schools, under plausible assumptions, an exclusive reliance on the rigorous evidence has RMSE three times worse than using the biased OLS result from each context. In making policy decisions one needs to rely on an understanding of the relevant phenomena that encompasses all of the available evidence.
Topic:
Development, Economics, Education, and Public Policy
Political Geography:
Global Focus

14. Reporte de Recomendaciones de Política: Hacia un Loreto más próspero

Author:
Ricardo Hausmann and Miguel Angel Santos
Publication Date:
12-2020
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Loreto es un lugar de contrastes. Es el departamento más grande del Perú, pero se encuentra entre los de menor densidad poblacional. Su capital, Iquitos, está más cerca de los estados fronterizos de Brasil y Colombia que de las capitales de sus regiones vecinas en el Perú - San Martín y Ucayali. Sólo se puede llegar a Iquitos por vía aérea o fluvial, lo que la convierte en una de las mayores ciudades del mundo sin acceso por carretera. Desde la fundación del departamento, la economía de Loreto ha dependido de la explotación de recursos naturales, desde el boom del caucho a finales del siglo XIX y principios del XX hasta la extracción petrolera y explotación de recursos forestales que predomina en nuestros días. Este modelo ha traído consigo daños ambientales significativos y ha producido un patrón de crecimiento lento y volátil, que ha abierto una brecha cada vez más amplia entre la economía de la región y la del resto del país. Entre 1980 y 2018, Loreto creció a una tasa promedio compuesta anual cuatro veces menor a la del resto del Perú. Es decir, mientras el resto del Perú triplicó el tamaño de su economía, la de Loreto creció algo menos que un tercio. En la última década (2008-2018), la región también se ha venido distanciando de sus pares amazónicos en el país (Ucayali, San Martín y Madre de Dios), que han crecido a una tasa promedio anual cinco veces mayor. En este período, el ingreso promedio por habitante en Loreto ha pasado de ser tres cuartas partes del promedio nacional en 2008 a menos de la mitad para 2018. Además del rezago económico - o quizás como consecuencia de él -, Loreto también se ubica entre los departamentos con peores indicadores de desarrollo social, anemia y desnutrición infantil del Perú. En este contexto, el Laboratorio de Crecimiento de la Universidad de Harvard se asoció con la Fundación Gordon and Betty Moore para desarrollar una investigación que proporcionara insumos y recomendaciones de política para acelerar el desarrollo de la región y generar prosperidad de forma sostenible.
Topic:
Development, Natural Resources, and Sustainability
Political Geography:
South America and Peru

15. Reporte de Recomendaciones de Política: Hacia un Loreto más próspero

Author:
Ricardo Hausmann and Miguel Angel Santos
Publication Date:
12-2020
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Loreto es un lugar de contrastes. Es el departamento más grande del Perú, pero se encuentra entre los de menor densidad poblacional. Su capital, Iquitos, está más cerca de los estados fronterizos de Brasil y Colombia que de las capitales de sus regiones vecinas en el Perú - San Martín y Ucayali. Sólo se puede llegar a Iquitos por vía aérea o fluvial, lo que la convierte en una de las mayores ciudades del mundo sin acceso por carretera. Desde la fundación del departamento, la economía de Loreto ha dependido de la explotación de recursos naturales, desde el boom del caucho a finales del siglo XIX y principios del XX hasta la extracción petrolera y explotación de recursos forestales que predomina en nuestros días. Este modelo ha traído consigo daños ambientales significativos y ha producido un patrón de crecimiento lento y volátil, que ha abierto una brecha cada vez más amplia entre la economía de la región y la del resto del país. Entre 1980 y 2018, Loreto creció a una tasa promedio compuesta anual cuatro veces menor a la del resto del Perú. Es decir, mientras el resto del Perú triplicó el tamaño de su economía, la de Loreto creció algo menos que un tercio. En la última década (2008-2018), la región también se ha venido distanciando de sus pares amazónicos en el país (Ucayali, San Martín y Madre de Dios), que han crecido a una tasa promedio anual cinco veces mayor. En este período, el ingreso promedio por habitante en Loreto ha pasado de ser tres cuartas partes del promedio nacional en 2008 a menos de la mitad para 2018. Además del rezago económico - o quizás como consecuencia de él -, Loreto también se ubica entre los departamentos con peores indicadores de desarrollo social, anemia y desnutrición infantil del Perú. En este contexto, el Laboratorio de Crecimiento de la Universidad de Harvard se asoció con la Fundación Gordon and Betty Moore para desarrollar una investigación que proporcionara insumos y recomendaciones de política para acelerar el desarrollo de la región y generar prosperidad de forma sostenible.
Topic:
Development, Natural Resources, and Sustainability
Political Geography:
South America and Peru

16. La Riqueza Escondida de Loreto: Análisis de Complejidad Económica y Oportunidades de Diversificación Productiva

Author:
Ricardo Hausmann and Miguel Angel Santos
Publication Date:
10-2020
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
El Laboratorio de Crecimiento de la Universidad de Harvard, bajo el auspicio de la Fundación Gordon and Betty Moore, ha desarrollado esta investigación para identificar las capacidades productivas existentes en Loreto y las actividades económicas con potencial para liderar la transformación estructural de su economía. Este reporte forma parte de una investigación más amplia – Transformación estructural y restricciones limitantes a la prosperidad en Loreto, Perú – que busca aportar insumos para el desarrollo de políticas públicas a escala nacional y regional que contribuyan a promover el desarrollo productivo y la prosperidad de la región, tomando en cuenta sus características particulares.
Topic:
Development, Economics, Diversification, and Economic Complexity
Political Geography:
Central America and Mexico

17. Emerging Cities as Independent Engines of Growth: The Case of Buenos Aires

Author:
Ricardo Hausmann, Douglas Barrios, Daniela Muhaj, and Sehar Noor
Publication Date:
10-2020
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
What does it take for a sub-national unit to become an autonomous engine of growth? This issue is particularly relevant to large cities, as they tend to display larger and more complex know-how agglomerations and may have access to a broader set of policy tools. To approximate an answer to this question, specific to the case of Buenos Aires, Harvard’s Growth Lab engaged in a research project from December 2018 to June 2019, collaborating with the Center for Evidence-based Evaluation of Policies (CEPE) of Universidad Torcuato di Tella, and the Development Unit of the Secretary of Finance of the City of Buenos Aires. Together, we have developed a research agenda that seeks to provide inputs for a policy plan aimed at decoupling Buenos Aires’s growth trajectory from the rest of Argentina’s.
Topic:
Development, Economic Growth, and Cities
Political Geography:
Argentina

18. Horrible Trade-offs in a Pandemic: Lockdowns, Transfers, Fiscal Space, and Compliance

Author:
Ricardo Hausmann and Ulrich Schetter
Publication Date:
07-2020
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
In this paper, we develop a heterogeneous agent general equilibrium framework to analyze optimal joint policies of a lockdown and transfer payments in times of a pandemic. In our model, the effectiveness of a lockdown in mitigating the pandemic depends on endogenous compliance. A more stringent lockdown deepens the recession which implies that poorer parts of society find it harder to subsist. This reduces their compliance with the lockdown, and may cause deprivation of the very poor, giving rise to an excruciating trade-off between saving lives from the pandemic and from deprivation. Lump-sum transfers help mitigate this trade-off. We identify and discuss key trade-offs involved and provide comparative statics for optimal policy. We show that, ceteris paribus, the optimal lockdown is stricter for more severe pandemics and in richer countries. We then consider a government borrowing constraint and show that limited fiscal space lowers the optimal lockdown and welfare, and increases the aggregate death burden during the pandemic. We finally discuss distributional consequences and the political economy of fighting a pandemic.
Topic:
Development, Government, Political Economy, Inequality, Economic Growth, Fiscal Policy, Pandemic, and COVID-19
Political Geography:
Global Focus

19. Creative Destruction or Idiot Winds: Schumpeterian Theory Meets the Educational Sector in Developing Countries

Author:
Mark H. Moore
Publication Date:
08-2019
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
This is one of a series of working papers from “RISE"—the large-scale education systems research programme supported by the UK’s Department for International Development (DFID), Australia’s Department of Foreign Affairs and Trade (DFAT), and the Bill and Melinda Gates Foundation.
Topic:
Development, Education, Governance, and Developing World
Political Geography:
Global Focus

20. When Do Development Projects Enhance Community Well-Being?

Author:
Michael Woolcock
Publication Date:
06-2019
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Many development agencies and governments now seek to engage directly with local communities, whether as a means to the realization of more familiar goals (infrastructure, healthcare, education) or as an end in itself (promoting greater inclusion, participation, well-being). These same agencies and governments, however, are also under increasing pressure to formally demonstrate that their actions ‘work’ and achieve their goals within relatively short timeframes – expectations which are, for the most part, necessary and desirable. But adequately assessing ‘community-driven’ approaches to development requires the deployment of theory and methods that accommodate their distinctive characteristics: building bridges is a qualitatively different task to building the rule of law and empowering minorities. Moreover, the ‘lessons’ inferred from average treatment effects derived from even the most rigorous assessments of community-driven interventions are likely to translate poorly to different contexts and scales of operation. Some guidance for anticipating and managing these conundrums are provided.
Topic:
Development, Government, Infrastructure, and International Development
Political Geography:
Global Focus and United States of America

21. Smart Development Banks

Author:
Eduardo Fernández-Arias, Ricardo Hausmann, and Ugo Panizza
Publication Date:
04-2019
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
The conventional paradigm about development banks is that these institutions exist to target well-identified market failures. However, market failures are not directly observable and can only be ascertained with a suitable learning process. Hence, the question is how do the policymakers know what activities should be promoted, how do they learn about the obstacles to the creation of new activities? Rather than assuming that the government has arrived at the right list of market failures and uses development banks to close some well-identified market gaps, we suggest that development banks can be in charge of identifying these market failures through their loan-screening and lending activities to guide their operations and provide critical inputs for the design of productive development policies. In fact, they can also identify government failures that stand in the way of development and call for needed public inputs. This intelligence role of development banks is similar to the role that modern theories of financial intermediation assign to banks as institutions with a comparative advantage in producing and processing information. However, while private banks focus on information on private returns, development banks would potentially produce and organize information about social returns.
Topic:
Development, Industrial Policy, Markets, and Banks
Political Geography:
Global Focus and Global Markets

22. Why Does Hirschmanian Development Remain Mired on the Margins? Because Implementation (and Reform) Really is 'a Long Voyage of Discovery'

Author:
Michael Woolcock
Publication Date:
02-2019
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
A defining task of development is enhancing a state’s capability for policy implementation. In most low- income countries, alas, such capabilities seem to be stagnant or declining, in no small part because dominant reform strategies are ill-suited to addressing complex non-technical aspects. This has been recognized for at least six decades – indeed, it was a centerpiece of Albert Hirschman’s understanding of the development process – yet this critique, and the significance of its implications, remain on the margins of scholarship and policy. Why? I consider three options, concluding that, paradoxically, followers of Hirschman’s approach inadequately appreciated that gaining more operational traction for their approach was itself a type of problem requiring their ideas to embark on ‘a long voyage of discovery’, a task best accomplished, in this instance, by building – and tapping into the distinctive insights of – a diverse community of development practitioners.
Topic:
Development, Political Economy, Developing World, and International Development
Political Geography:
North America and United States of America

23. Place-specific Determinants of Income Gaps: New Sub-National Evidence from Chiapas, Mexico

Author:
Ricardo Hausmann, Carlo Pietrobelli, and Miguel Angel Santos
Publication Date:
07-2018
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
The literature on income gaps between Chiapas and the rest of Mexico revolves around individual factors, such as education and ethnicity. Yet, twenty years after the Zapatista rebellion, the schooling gap between Chiapas and the other Mexican entities has shrunk while the income gap has widened, and we find no evidence indicating that Chiapas indigenes are worse-off than their likes elsewhere in Mexico. We explore a different hypothesis. Based on census data, we calculate the economic complexity index, a measure of the knowledge agglomeration embedded in the economic activities at a municipal level in Mexico. Economic complexity explains a larger fraction of the income gap than any individual factor. Our results suggest that chiapanecos are not the problem, the problem is Chiapas. These results hold when we extend our analysis to Mexico’s thirty-one federal entities, suggesting that place-specific determinants that have been overlooked in both the literature and policy, have a key role in the determination of income gaps.
Topic:
Development, Economics, Migration, Political Economy, and Economic Inequality
Political Geography:
Central America, Mexico, and Chiapas

24. Appraising the Economic Potential of Panama: Policy Recommendations for Sustainable and Inclusive Growth

Author:
Ricardo Hausmann, Miguel Angel Santos, and Juan Obach
Publication Date:
05-2017
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
This report aims to summarize the main findings of the project as gathered by the three baseline documents, and frame them within a coherent set of policy recommendations that can help Panama to maintain their growth momentum in time and make it more inclusive. Three elements stand out as cornerstones of our proposal: (i) attracting and retaining qualified human capital; (ii) maximizing the diffusion of know-how and knowledge spillovers, and (iii) leveraging on public-private dialog to tackle coordination problems that are hindering economic activity outside the Panama-Colón axis.
Topic:
Development, Economics, Economic Growth, and Economic Policy
Political Geography:
Central America and Panama

25. Learning to Target for Economic Diversification: PDIA in Sri Lanka

Author:
Matt Andrews and Peter Harrington
Publication Date:
01-2017
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Many countries, like Sri Lanka, are trying to diversify their economies but often lack the capabilities to lead diversification programs. One of these capabilities relates to targeting new sectors to promote and pursue through a diversification policy: countries know they are ‘doomed to choose’ sectors to target,1 but lack effective capabilities to do the targeting. This paper narrates a recent (and ongoing) initiative to establish this kind of capability in Sri Lanka. The initiative adopted a Problem Driven Iterative Adaptation (PDIA) process, where a team of Sri Lankan officials worked with Harvard Center for International Development (CID) facilitators to build capabilities. The paper tells the story of this process, providing documented evidence of the progress over time and describing the thinking behind the PDIA process. It shows how a reliable targeting mechanism can emerge in a reasonably limited period, when a committed team of public officials are effectively authorized and engaged. The paper will be of particular interest to those thinking about targeting for diversification and to those interested in processes (like PDIA) which are focused on building state capability and fostering policy implementation in public contexts.
Topic:
Development, Economics, Economic Growth, and Economic Policy
Political Geography:
South Asia and Sri Lanka

26. Institutions vs. Social Interactions in Driving Economic Convergence: Evidence from Colombia

Author:
Michele Coscia, Timothy Cheston, and Ricardo Hausmann
Publication Date:
02-2017
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Are regions poor because they have bad institutions or are they poor because they are disconnected from the social channels through which technology diffuses? This paper tests institutional and technological theories of economic convergence by looking at income convergence across Colombian municipalities. We use formal employment and wage data to estimate growth of income per capita at the municipal level. In Colombia, municipalities are organized into 32 departamentos or states. We use cellphone metadata to cluster municipalities into 32 communication clusters, defined as a set of municipalities that are densely connected through phone calls. We show that these two forms of grouping municipalities are very different. We study the effect on municipal income growth of the characteristics of both the state and the communication cluster to which the municipality belongs. We find that belonging to a richer communication cluster accelerates convergence, while belonging to a richer state does not. This result is robust to controlling for state fixed effects when studying the impact of communication clusters and vice versa. The results point to the importance of social interactions rather than formal institutions in the growth process.
Topic:
Development, Economics, Science and Technology, Economic Growth, and Institutions
Political Geography:
Colombia and South America

27. Welcome Home in a Crisis: Effects of Return Migration on the Non-migrants' Wages and Employment

Author:
Ricardo Hausmann and Ljubica Nedelkoska
Publication Date:
01-2017
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Over the past few decades, migration from developing to developed countries was often viewed as 'brain drain', as talented workers were forced out of their home countries due to lack of competitive opportunities. The population that left these countries and settled in the more economically advanced parts of the world have, over time, acquired financial capital and built social networks within host countries. Hence, while the home countries were still suffering from the scarcity of knowhow, significant shares of their populations began to actively engage in more productive economies. It seems that, through migration, developing countries had unexpectedly created significant networks of human and financial capital abroad. But are these foreign networks transferring knowhow back to their home countries? It turns out that those same reasons that induced the economic migration in the first place, often make it difficult for migrants to engage afterwards. What would happen, however, if a large proportion of these diasporas was forced to return back to their home country - would that lead to knowhow transfer? Our study investigates the impact of such an abrupt return migration wave between Greece and Albania.
Topic:
Development, Migration, Labor Issues, Developing World, and Economy
Political Geography:
Europe, Eastern Europe, Greece, and Albania

28. Shifting Gears: A Growth Diagnostic of Panama

Author:
Ricardo Hausmann, Luis Espinoza, and Miguel Angel Santos
Publication Date:
10-2016
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Leveraging on the Canal, Panama has a developed a major comparative advantage in the exportable services sector. In turn, the stellar growth in this sector has spurred the demand for construction, which has been key to promote upward social mobility and increase labor productivity. But there are signs that this sector is receding, incapable of sustaining growth rates that are higher than the rest of the economy. This threatens to undo some of the progress made in terms of reducing income inequality and poverty in the country, and have the potential to stir social unrest. To face these new challenges, Panama must increase its stock of human capital by improving the quality of education, which is among the lowest in the world. Meanwhile, the country must open up to high-skilled immigration by removing harmful restrictions. To fully profit from immigration, it is equally important to maximize the diffusion of these skills and promote know- how spill overs through adequate policy. Finally, Panama must strengthen its institutions and reduce red tape and corruption, which most firms currently consider the most binding constraint to growth.
Topic:
Development, Immigration, Infrastructure, Economic Growth, Institutions, and Human Capital
Political Geography:
Central America and Panama

29. Panama beyond the Canal: Using Technological Proximities to Identify Opportunities for Productive Diversification

Author:
Ricardo Hausmann, Jose Ramon Morales, and Miguel Angel Santos
Publication Date:
10-2016
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
The economy of Panama has thrived for more than a decade, based on a modern service sector on the activities surrounding the Canal. Panama has inserted its economy into global value chains, providing competitive services in logistics, ship handling, financial intermediation, insurance, communication and trade. The expansion of the modern service sector required significant non-residential construction, including office buildings, commercial outlets, warehouses, and even shopping malls. Large public infrastructure projects such as the expansion of the Canal, the Metro, and Tocumen airport, have provided an additional drive and paved the road for productive diversification. But productive diversification does not spread randomly. A country diversifies towards activities that demand similar capacities than the ones already in place. Current capabilities and know-how can be recombined and redeployed into new, adjacent activities, of higher value added. This report identifies productive capabilities already in place in Panama, as signaled by the variety and ubiquity of products and services that is already able to manufacture and provide competitively. Once there, we move on to identifying opportunities for productive diversification based on technological proximity. As a result, we provide a roadmap for potential diversification opportunities both at the national and sub-national level.
Topic:
Development, Infrastructure, Economy, Economic Growth, and Diversification
Political Geography:
Central America and Panama

30. Governance and the Challenge of Development Through Sports: A Framework for Action

Author:
Matt Andrews, Stuart Russell, and Cristina Barrios
Publication Date:
07-2016
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Previous papers such as Russell, Barrios & Andrews (2016), Guerra (2016), and Russell, Tokman, Barrios & Andrews (2016) have aimed to provide an empirical view into the sports economy. This proves to be a difficult task, given the many definitions of ‘sports’ and data deficiencies and differences in the sports domain (between contexts and over time). The emerging view in these previous papers provides interesting information about the sports sector, however: it shows, for instance, that different contexts have differently intensive sports sectors, and that sports activities overlap with other parts of the economy. This kind of information is useful for policymakers in governments trying to promote sports activities and use sports to advance the cause of broad-based social and economic development. This paper is written with these policymakers in mind. It intends to offer a guide such agents can use in constructing sports policies focused on achieving development goals (what we call development through sports[1]), and discusses ways in which these policymakers can employ empirical evidence to inform such policies. The paper draws on the concept of ‘governance’ to structure its discussion. Taking a principal-agent approach to the topic, governance is used here to refer to the exercise of authority, by one set of agents, on behalf of another set of agents, to achieve specific objectives. Building on such a definition, the paper looks at the way governmental bodies engage in sports when acting to further the interests of citizens, most notably using political and executive authority to promote social and economic development. This focus on governance for development through sports (asking why and how governments use authority to promote sports for broader social and economic development objectives[2]) is different from governance of sports (which focuses on how governments and other bodies exercise authority to control and manage sports activities themselves), which others explore in detail but we will not discuss.[3] The paper has five main sections. A first section defines what we mean by ‘governance’ in the context of this study. It describes an ends-means approach to the topic—where we emphasize understanding the goals of governance policy (or governance ends) and then thinking about the ways governments try to achieve such goals (the governance means). The discussion concludes by asking what the governance ends and means are in a development through sports agenda. The question is expanded to ask whether one can use empirical evidence to reflect on such ends and means. One sees this, for instance, in the use of 'governance indicators' and 'governance dashboards' in the international development domain. A second section details the research method we used to address these questions. This mixed method approach started by building case studies of sports policy interventions in various national and sub-national governments to obtain a perspective on what these policies tend to involve (across space and time). It then expanded into an analysis of sports policies in a broad set of national and sub-national governments to identify common development through sport ends and means. Finally, it involved experimentation with selected data sources to show how the ends and means might be presented in indicators and dashboards—to offer evidence-based windows into development through sports policy regimes. Based on this research, sections three and four discuss the governance ends and means commonly pursued and employed by governments in this kind of policy process. The sections identify three common ends (or goals)—inclusion, economic growth, and health—and a host of common means—like the provision of sports facilities, organized activities, training support, financial incentives, and more—used in fostering a development through sports agenda. Data are used from local authorities in England to show the difficulties of building indicators reflecting such policy agendas, but also to illustrate the potential value of evidence-based dashboards of these policy regimes. It needs to be stated that this work is more descriptive than analytical, showing how data can be used to provide an evidence-based perspective on this domain rather than formally testing hypotheses about the relationship between specific policy means and ends. In this regard, the work is more indicative of potential applications rather than prescriptive. A conclusion summarizes the discussion and presents a model for a potential dashboard of governance in a development through sports policy agenda.
Topic:
Development, Governance, Sports, and Economic Policy
Political Geography:
Europe and England

31. Getting the Ball Rolling: Basis for Assessing the Sports Economy

Author:
Stuart Russell, Douglas Barrios, and Matt Andrews
Publication Date:
07-2016
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Data on the sports economy is often difficult to interpret, far from transparent, or simply unavailable. Data fraught with weaknesses causes observers of the sports economy to account for the sector differently, rendering their analyses difficult to compare or causing them to simply disagree. Such disagreement means that claims regarding the economic spillovers of the industry can be easily manipulated or exaggerated. Thoroughly accounting for the industry is therefore an important initial step in assessing the economic importance of sports-related activities. For instance, what do policymakers mean when they discuss sports-related economic activities? What activities are considered part of the "sports economy?" What are the difficulties associated with accounting for these activities? Answering these basic questions allows governments to improve their policies. The paper below assesses existing attempts to understand the sports economy and proposes a more nuanced way to consider the industry. Section 1 provides a brief overview of existing accounts of the sports economy. We first differentiate between three types of assessments: market research accounts conducted by consulting groups, academic accounts written by scholars, and structural accounts initiated primarily by national statistical agencies. We then discuss the European Union’s (EU) recent work to better account for and understand the sports economy. Section 2 describes the challenges constraining existing accounts of the sports economy. We describe two major constraints - measurement challenges and definition challenges - and highlight how the EU's work has attempted to address them. We conclude that, although the Vilnius Definition improves upon previous accounts, it still features areas for improvement. Section 3 therefore proposes a paradigm shift with respect to how we understand the sports economy. Instead of primarily inquiring about the size of the sports economy, the approach recognizes the diversity of sports-related economic activities and of relevant dimensions of analysis. It therefore warns against attempts at aggregation before there are better data and more widely agreed upon definitions of the sports economy. It asks the following questions: How different are sports-related sectors? Are fitness facilities, for instance, comparable to professional sports clubs in terms of their production scheme and type of employment? Should they be understood together or treated separately? We briefly explore difference in sports-related industry classifications using data from the Netherlands, Mexico, and the United States. Finally, in a short conclusion, we discuss how these differences could be more fully explored in the future, especially if improvements are made with respect to data disaggregation and standardization.
Topic:
Development, Sports, Economy, and Economic Policy
Political Geography:
Europe and European Union

32. Towards a Prosperous and Productive Chiapas: Institutions, Policies, and Public-Private Dialog to Promote Inclusive Growth

Author:
Ricardo Hausmann, Timothy Cheston, Miguel Angel Santos, and Carlo Pietrobelli
Publication Date:
03-2016
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Since the Zapatista revolution of January 1994, enormous amount of resources coming from the federal government have poured over Chiapas. The gap in years and quality of education has been reduced significantly; and road, port and airport infrastructure have undergone a dramatic transformation. And yet, the income gap between Chiapas and the rest of Mexico has only widened. To understand why, a multi-disciplinary team of twelve experts have devoted significant time and resources to study different aspects of the development dynamic of Chiapas. As a result, 5 base documents have been published analyzing Chiapas: Complexity profile, Growth Diagnostic, Institutional Diagnostic, Poverty profile, and Pilot of productive dialogs and inclusive growth in an indigenous community. This report resumes the findings from these and articulates their corresponding recommendations into a policy plan. According to our hypothesis, Chiapas is wedged in a low productivity trap. A modern production system, responsible for productivity increases, income and development elsewhere in the world, requires a number of complementary inputs or capacities that are absent in Chiapas. As a result, its economy consists of a few primary products of little or no technological sophistication, and a vibrant service industry fueled by public expenditure in its larger cities. In this situation, there are no incentives to acquire additional education or skills because there is no demand for them in the economy. As we have proved, the few that manage to emigrate earn salaries elsewhere in Mexico slightly above other migrants with similar qualifications. As it turns out, it is not about the Chiapanecos, it is about Chiapas. To overcome the current dilemmas and spark the engine of growth, Chiapas needs to resolve its issues of coordination, connectivity and gradually promote economic activities of higher complexity. Yazaki, one of the few manufacturers present in Chiapas, is an example of the role of the state in helping the economy to overcome the chicken-and-egg dilemmas, providing the public goods required - in an initial push – by a more complex economy. Our recommendations are based in identifying the productive capabilities embedded within the current productive structure of Chiapas four largest urban agglomerations, and leveraging on them to board on different potential, more complex industries that use a similar base of knowledge. To conquer those industries and diversify its economy, Chiapas needs a public-private agency empowered to iteratively solve the issues and bottlenecks these potential industries face in each particular place. Public transport and housing policy can be used as means to incorporating the surrounding communities into the increasingly modern economies of urban centers. Special economic zones and agro-industrial parks can be used to spur productivity in those areas where labor and appropriability are the most binding constrains.
Topic:
Development, Poverty, Infrastructure, Income Inequality, Economic Growth, and Institutions
Political Geography:
Central America, Mexico, and Chiapas

33. Scaling PDIA through Broad Agency, and Your Role

Author:
Matt Andrews, Lant Pritchett, and Michael Woolcock
Publication Date:
01-2016
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Many development challenges are complex, involving a lot of different agents and with unknown dimensions. Solutions to these challenges are often unknown, and contextually dependent. At the same time, there are political imperatives at play in many contexts which create pressure to 'find the solution now…and then scale it up.' Such pressure raises a question: how does a policy entrepreneur or reformer find a new solution and scale it up when dealing with complexity? This is the subject we address in the current paper, which is the fifth in a series on 'how to' do problem driven iterative adaptation (PDIA) (Andrews et al. 2015, 2016a, 2016b, 2016c). The paper focuses on building broad agency solutions in the process of identifying problems and finding and fitting contextually appropriate solutions. The broad agency is, in our opinion, a most effective mechanism to ensure scaling and dynamic sustainability in the change process. As with other working papers on this topic, the contents here do not offer all answers to those asking questions about how to do development effectively. It closes by reflecting on the importance of 'you' (the reader, and ostensibly part of a policy change or reform team somewhere) using this and the other ideas as heuristics to rethink and reorient how you work—but with your own signature on each idea.
Topic:
Development, Government, International Development, and Scaling
Political Geography:
Malaysia and Burkina Faso

34. Managing Your Authorizing Environment in a PDIA Process

Author:
Matt Andrews, Lant Pritchett, and Michael Woolcock
Publication Date:
01-2016
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Development and state building processes are about change. Change is, however, elusive in many contexts. In prior work, we have offered problem driven iterative adaptation (PDIA) as an approach to tackle wicked hard change challenges. This is our fourth practical working paper on ‘how’ to do PDIA. The working paper addresses questions about authority, given that authority is needed to make change happen—especially in hierarchical government settings. This authority is often difficult to attain, however. It is seldom located in one office of person, and is often harder to lock-in with complex challenges, given that they commonly involve significant risk and uncertainty and require engagement by many agents responding to different kinds of authority. Every effort must be taken to address such challenges, and efforts should include an explicit strategy to establish an appropriate authorizing environment. This working paper suggests ideas to adopt in this strategy, with practical exercises and examples to help the reader apply such ideas in her or his own work.
Topic:
Development, Government, International Development, and State
Political Geography:
Global Focus and United States of America

35. Why is Chiapas Poor?

Author:
Dan Levy, Ricardo Hausmann, Miguel Angel Santos, Luis Espinoza, and Miguel Flores
Publication Date:
07-2015
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
No matter which way you look at it, Chiapas is the most backward of any state in Mexico. Its per capita income is the lowest of the 32 federal entities, at barely 40% of the national median (Figure 1). Its growth rate for the decade 2003-2013 was also the lowest (0.2%),1 causing the income gap separating Chiapas from the national average to increase from 53% to 60%. That is to say that today the average income for a worker in Mexico is two and a half times greater than the average in Chiapas. The two next poorest states, Oaxaca and Guerrero, are 25% and 30% above Chiapas.2 According to the Instituto Nacional de Estadística y Geografía de México (INEGI, National Institute of Statistics and Geography), Chiapas is also the state with the highest poverty rate (74.7%) as well as extreme poverty (46.7%).3 These major differences in income levels among Mexican federal entities are reproduced as in a fractal within Chiapas. In fact, while the wealthiest entity (Mexico City) is wealthier than the poorest (Chiapas) by a factor of six, the difference within Chiapas between the wealthiest municipality (Tuxtla Gutiérrez) and the poorest (Aldama and Mitontic) is by a factor greater than eight.4 As there are different "Mexicos" within Mexico,5 in Chiapas there are also different sorts of Chiapas (Figure 2). Income per capita in Tuxtla Gutiérrez, to the right of the distribution, is five standard deviations above the state average. Next comes a series of intermediate cities, San Cristóbal de las Casas, Comitán de Domínguez, Tapachula, and Reforma, between two and a half to four standard deviations above the average. The remaining municipalities of Chiapas follow (122 in all), clustered to the far left of the distribution. In addition, both the statistics available at the town level and our visits to various municipalities in Chiapas seem to indicate that significant differences also exist within these municipalities. From this vantage point, questions as to why Chiapas is poor, or what explains its significant backwardness compared to other areas of Mexico, become much more complex. Why do some regions in Chiapas have high income levels, while other regions remain stagnant, fully dependent on federal transfers and deprived from the benefits of modern life?
Topic:
Development, Poverty, Governance, and Economic Inequality
Political Geography:
Central America, Mexico, and Chiapas

36. Engaging with Fragile and Conflict-Affected States

Author:
Michael Woolcock
Publication Date:
07-2014
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
The coherence and effectiveness of engagement with the world's 'fragile and conflict-affected states'—beyond ethical imperatives and geo-strategic considerations—turns on answers to two vexing questions. First, on what defensible basis is any given country, at any given historical moment, deemed to be (or not to be) 'fragile'? Second, if a defining characteristic of state fragility is low levels of capability to implement core responsibilities, how can international agencies best support domestic public organizations to acquire capability? The first issue may appear to be a methodological one (wherein more and better data would provide a firmer empirical foundation on which to base key decisions) but any determination, especially of marginal cases, must also be grounded in a correspondingly comprehensive theory of change. Similarly, the optimal response to the second issue may appear to be importing technical and rigorously verified ('best practice') solutions, but in fact it is more likely to require a qualitatively different strategy, one able to experiment with alternative design specifications and adapt in real time to changing contextual realities (thereby iterating towards customized 'best fit' solutions). To this end, an alternative approach to the theory, measurement and practice of engaging with fragile states is outlined, in the spirit of rising concerns across the development community that prevailing strategies have demonstrably reached the limits of their effectiveness.
Topic:
Security, Development, Conflict, State, and Institutions
Political Geography:
Global Focus and United States of America

37. The Best of Rules and Discretion: A Case for Nominal GDP Targeting in India

Author:
Pranjul Bhandari and Jeffrey Frankel
Publication Date:
07-2014
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
The recent revival of interest in nominal GDP (NGDP) targeting has come in the context of large advanced economies. We argue that the case for NGDP targeting is even more appealing for mid-sized developing countries, because they tend to be more susceptible to supply shocks and terms of trade shocks. For India, in particular, one major exogenous supply shock is the monsoon rains. NGDP targeting splits the impact of supply shocks automatically between inflation and real GDP growth. In the case of inflation targeting (IT), by contrast, the full impact of an adverse supply shock or terms of trade shock is felt as a loss in real GDP alone. NGDP targeting arguably achieves the best of both worlds: it automatically accommodates supply shocks as most central banks with discretion would do anyway, while retaining the advantage of anchoring expectations as rules are designed to do. We outline a simple theoretical model and derive the conditions under which an NGDP targeting regime would dominate other regimes such as IT for achieving objectives of output and price stability. We go on to estimate for the case of India the main parameters needed to ascertain whether these conditions hold, most notably the slope of the aggregate supply curve. We find that under certain plausible conditions, nominal GDP targeting is indeed better placed than IT, especially in the face of the supply shocks that developing countries tend to experience.
Topic:
Development, Emerging Markets, Monetary Policy, GDP, Inflation, and Central Bank
Political Geography:
South Asia and India

38. How should Uganda grow?

Author:
Ricardo Hausmann, Brad Cunningham, John Matovu, Rosie Osire, and Kelly Wyett
Publication Date:
01-2014
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
ncome per capita in Uganda has doubled in the last 20 years. This remarkable performance has been buoyed by significant aid flows and large external imbalances. Economic growth has been concentrated in non-tradable activities leading to growing external imbalances and a growing gap between rural and urban incomes. Future growth will depend on achieving sufficient export dynamism. In addition, growth faces a number of other challenges: low urbanization rate, rapid rural population growth and high dependency ratios. However, both the dependency ratio and fertility rates have begun to decline recently. Rural areas are also severely overcrowded with low-productivity subsistence agriculture as a pervasive form of production. Commercial agriculture has great possibilities to increase output, but as the sector improves its access to capital, inputs and technology it will shed jobs rather than create them. These challenges combined tell us that future growth in Uganda will require a rapid rate of export growth and economic diversification. The country faces the prospect of an oil boom of uncertain size and timing. It could represent an important stepping stone to achieve external sustainability, expanded income and infrastructure and a greater internal market. However, as with all oil booms, the challenges include avoiding the Dutch disease, managing the inevitable volatility in oil incomes and avoiding inefficient specialization in oil. Policies that set targets for the non-oil deficit could help manage some of these effects, but a conscious strategy to diversify would still be needed. The best strategy is therefore to use the additional oil revenue and accompanying investments to promote a diversification strategy that is sustainable. To determine how to encourage such a transformation, we draw on a new line of research that demonstrates how development seldom implies producing more of the same. Instead, as countries grow, they tend to move into new industries, while they also increase productivity in existing sectors. In this report, we analyze what those new industries might be for Uganda. To do so, we first look to those products which balance the desire to increase the diversification and complexity of production, while not over-stretching existing capabilities. These include mostly agricultural inputs, such as agrochemicals and food processing. In addition, Uganda should concurrently develop more complex industries, such as construction materials, that are reasonably within reach of current capabilities and will be in great demand in the context of an oil boom. Here, the fact that Uganda is landlocked and faces high import costs will provide natural protection to the expanding demand in Uganda and neighboring countries. We conclude with a discussion of the government policies that will support Uganda in developing new tradable industries.
Topic:
Development, Humanitarian Aid, Science and Technology, and Economic Growth
Political Geography:
Uganda and Africa