The conference aims at bringing together Nordic and international scholars for the exchange of ideas and discussion of recent results within theoretical and applied development economics research.

The creation of productive jobs for both men and women are essential preconditions for the achieving the Sustainable Development Goals (SDGs) on decent work and gender equality.

The conference engages current debates around the future of work in the face of rapid labour-saving technological advances, vis-à-vis the changing nature of globalization. It addresses the implications of this on achieving SDG 8 on decent work and economic growth, and the prospects for structural transformation in low- and middle-income countries.

The ‘Responding to crises’ conference aimed to improve knowledge about ongoing, unexpected, and future crises, and to discuss the options available for responses by governments, international agencies, NGOs, civil society and private citizens.

The conference payed close attention to the economic and social impact of crisis, the tensions that arise in responding to continuing crises while dealing with the unexpected, the resourcing of responses and what the future might bring—for good or bad.

Human capital has been identified not only as a key determinant of growth and poverty alleviation, but as critical for human development. The United Nations Millennium Development Goals (MDGs), and now the Sustainable Development Goals (SDGs), have further highlighted the importance of health and education as crucial welfare improving mechanisms.

Migration and mobility are key facets of our increasingly globalized world, posing challenges but also offering opportunities. For migrants, this may include economic and social mobility, as well as improved physical security and an escape from conflict, violence and persecution. While the impact of migration on both host and sending countries is a topic of considerable contemporary political debate, there is also ample research showing the benefits in terms of labour market outcomes, economic growth, as well as diversity and innovation.

Many low- and middle-income countries are achieving good rates of economic growth, but high inequality remains a priority concern. Some countries meanwhile have low growth, high inequality, and pervasive poverty―often linked to their fragility. There is now an active debate on whether countries should set themselves goals for not only achieving absolute poverty reduction, but also lower inequality. But policy action needs to be better served by analysis and data.

apid and sustained poverty reduction requires ‘inclusive growth’ that allows people to contribute to and benefit from the development process. Africa’s economic performance has improved considerably since the 1980s and early 1990s. Nevertheless, many questions remain unanswered. For instance, has recent progress in Africa been under- or over-stated? Are certain social groups being excluded from the growth and development process? Which dimensions of poverty are leading or lagging? Has economic growth been transformative, leading to more and better jobs?

Sub-Saharan Africa currently is facing a range of demographic and socioeconomic shifts that hold important implications for both the region’s economic and political development. One of these shifts has been the emergence of a sizeable and dynamic middle-class over the last decade. While this trend is attracting the attention of policy makers and the private sector, there is little research on the size, drivers, and preferences of Africa’s middle-class. This project will therefore focus on whether, and in what ways, Africa’s middle-class represents a positive force not only for growth, poverty reduction, and socioeconomic equality but also for greater democratization within the region. In addressing these issues, attention will be given to cross-country variations as a result of disparate political regimes and economic resource base

Sub-Saharan Africa’s 'youth bulge' is expected to shape development processes and policies over coming decades. For some, this is a worrying dynamic given the region’s low levels of development and fragile political systems. For others, the youth offer the prospect of being 'new agents of change' by introducing greater economic dynamism and political accountability. Despite the journalistic attention paid to youth issues, especially in the wake of the global recession, there has been far less rigorous scholarship on the behaviors and impact of youth on African development.

Despite decades of research and advances in data and methods, measuring poverty and reconciling this with patterns of economic growth remains a complex and contentious issue. UNU-WIDER’s Growth and Poverty Project (GAPP) re-examines Africa’s growth, poverty and inequality trends.

This project will implement a survey of 2,500 small and medium-sized non-state enterprises operating in the manufacturing sector of ten provinces Vietnam. The survey instrument, which will be up-dated as part of this project, consists of three modules: (i) a main enterprise questionnaire; (ii) an ‘employee module’; and (iii) an ‘economic accounts module’. A key output is a high-quality database, and on this basis the project team will produce a comprehensive report summarizing the main findings from the data and providing key insights into SME characteristics and dynamics.

This project investigates issues concerning (a) evolution of land inequality and the role of policies concerning land rights, and (b) accountability of local governments in developing countries in Asia, Africa, and Latin America. One component is a set of research papers on these issues in the context of West Bengal, India. The other component is an international conference on the topic of land inequality and land rights which examines related issues in a number of developing countries.

The current Social Accounting Matrix (SAM) for Vietnam is for the year 2007. UNU-WIDER and associate researchers work with staff of the Central Institute of Economic Management in Vietnam (CIEM) and the SAM Toolkit to update the SAM to the year 2011 and to extend this SAM to include a more detailed treatment of Vietnam’s energy sector. For this purpose a new set of demand and supply data for 2011 needs to be compiled.

This project investigates several issues, such as: (i) distilling the policy lessons (for Latin America itself and other countries) arising from the 'Open Economy Redistribution With Growth' (OERWG) model developed during the last decade, with particular attention to the gains in the field of growth, inequality and poverty reduction; (ii) testing whether the policy shift which followed the transition to democracy and the election of centre-left and other regimes contributed to the growth acceleration and inequality decline of 2002-08; (iii) identify best practice policies in the policy areas illustrated above; (iv) analyse the extent of their distributive and growth effects; (v) assess the future sustainability of OERWG model, given the hurdles Latin American governments still face; (vi) discuss the problems of the OERWG model in the fields of industrial policy and diversification of output-exports towards the technology-intensive manufacturing sector; (vii) examine how Latin America can raise its domestic savings and reduce its costly dependence on volatile foreign savings; (viii) propose an extended version of the OERWG model addressing the structural handicaps still hampering improvements in the field of growth, inequality and poverty reduction in the region.

Learning to Compete seeks to answer a seemingly simple but puzzling question: why is there so little industry in Africa? Industry—including modern services and agro-industry—is often the key to job creation, poverty reduction, and growth. Most Asian economies began their industrialization processes with initial conditions quite similar to many African countries today, yet, while Asia had explosive industrial growth, Africa’s shares of global manufacturing value added and exports have fallen. To sustain growth Africa must learn to compete in global markets.

Food price volatility is one of the major challenges facing the global agricultural system today. This was most vividly illustrated during the global food crisis of 2007-2009 when price spikes occurred for key staple commodities such as wheat, rice, maize, and soybeans. Given the variety of reactions by governments of countries experiencing similar food price shocks, the crisis offers an excellent natural experiment for generating knowledge on responses to price volatility in particular and on the political economy of agricultural policy-making more generally. With its collaborating partners, this UNU-WIDER project consisted of case studies on 17 low- and middle-income countries that were highly affected by the 2007-2009 food crisis.

The new knowledge generated by research must be shared if it is to be of use. This can only be done by effective communication with national policy makers, aid officials, parliamentarians, and other practitioners in NGOs and social movements. Communication is as important to ReCom’s success as research.

In this part of the ReCom–Research and Communication on Foreign Aid project we look at what aid can do to create more economic growth and employment . The key questions include; What are the effects of aid on growth? Through which channels does aid act best as a catalyzer for growth? How can aid help improve the livelihoods of the poorest people, improve the opportunities for women in the labour market, and provide more employment for young people?

Since the late 1990s there has been shift in the way foreign aid is intended to be distributed to the social sectors, moving from traditional forms of project aid towards more comprehensive instruments of development assistance, including public-private partnerships, and international financing mechanisms.

Since the late 1980s, governance has become a major concern for both donors and aid recipient countries. Good governance is seen as an important objective in and of itself, as well as a critical influence on economic development. The 2005 Paris Declaration’s commitment to national ownership of the aid agenda has further focused attention on the quality of domestic governance.

Women suffer economic, social, and political discrimination. Much has been done over the last three decades to try and reverse such discrimination, and aid has played its part. Yet in many societies there is often a higher incidence of poverty among women than men, while women are also more likely to live in extreme poverty.

Climate change poses humanity’s biggest challenge. With climate change now an urgent priority, what can we learn from past successes of development co-operation in the environmental area, its failures, and how can some of these successes be scaled-up in the area of climate change adaption?

Sustaining development in developing countries has never been as complicated a task as it is today in the face of a world characterized by tremendous competition over resources that are becoming scarcer. Climate change and its impact on water resources and agriculture, is one of the major problems facing developing countries in Africa. The research effort in this project aims to measure the impact of climate change directly on agriculture, and indirectly through its linkages with other sectors. It also examines the impacts of alternative mitigation policies. To achieve these objectives, an integrated methodological approach is used. We integrate two modeling frameworks that have been applied successfully on a wide range of problems: the GTAP model and the IMPACT-WATER model. The aim is to provide not only a country-based analysis, but to create analytical tools that can be applied in other countries and regions.

This project investigates issues concerning poverty and vulnerability in developing countries building on behavioural economics. The project seeks to derive poverty measures that are based on prospect theory, an alternative model to expected utility theory for decision-making under uncertainty. The new measure takes into account the reference point individuals use when evaluating their wellbeing and the possibility for loss aversion, which highlights the importance of downside risks. These measures are then implemented using panel and cross-section data from developing countries.

This project acts as an instrument for UNU-WIDER to conduct small-scale projects or studies on topics of immediate policy importance that deserve a swift and critical response; to experiment with the application of new analytical techniques to development issues, and to build new research ideas that may then constitute the basis of larger projects in the main programme. Small projects may include empirical evaluation of development insights; trade reform and employment; development economics and public policy; poverty measurement and inequality.

Climate change is likely to remain a serious issue for decades to come if not indefinitely. One of the key tasks for assisting policy makers in developing countries address the uncertainties of climate change is translating scientific and biophysical processes into economic outcomes. UNU-WIDER’s DUCC – Development Under Climate Change project is particularly aimed at addressing this challenge by using an analytical framework that traces the economic implications of climate change. The framework used in the project takes into account a wide range of factors including production of hydropower, agricultural yield, water supply/demand balance, and the costs of maintaining infrastructure. These impacts then serve as inputs into an economy-wide model of the country in question which aids the assessment of economic impacts and policy options.

Existing research on Africa has produced a seemingly endless list of reasons why African growth and poverty reduction record has lagged behind that of other regions of the developing world. This project looks at the reasons put forward for Africa’s disappointing development record, attempting to differentiate between myth and reality. It also seeks to determine the relative priorities that need to be given to factors that have in reality most contributed to this record, providing a blue print for public policy into the 21st Century.

The aim of this project is to take stock of the often overlooked options now available to researchers at the frontiers of poverty analysis and to illustrate their use in developing country contexts. The main project activity will be an international conference held in Helsinki in September 2008. Its main target audience will be researchers, but also policy makers and practitioners that work with poverty data. A number of WIDER research papers will be published on line and one or two edited volumes will also be published.

In 2007 the number of urban inhabitants will surpass rural dwellers as a percentage of the total world population. By 2030 the proportion of people living in cities globally is expected to reach 61%, with almost 80% of urban dwellers living in less developed countries. For the first time in history the world will tip from being predominantly rural to predominantly urban. We need to understand the implications of this 2007 tipping point for cities as well as the countries, regions, and international development systems of which they are a part.

Entrepreneurship can play an important role in structural economic change and in improving wellbeing. Governments and international institutions are investing increasing resources to promote entrepreneurship. This project aims at a greater understanding of the ways in which entrepreneurial capacity can be harnessed for overall economic development. In particular more light will be thrown on the sources of entrepreneurial growth in the global economy, and how public policy may strengthen the allocation and contributions of entrepreneurs towards innovation, technological catch-up and competition.

Their influence of elites in politics, government, business, and the media profoundly influences the direction of economic and social activities. In some countries, the preferences of elites are closely aligned with the national interest. Elsewhere their predation is a major source of development failure. This project will examine the formation of elites and their impact on development outcomes. Topics will include the means by which elite status is attained; the ways power is exercised; and the extent to which the personal goals of elites are consistent with national objectives.

The fall of the Berlin Wall in November 1989 was a defining moment in the transition of former socialist countries into market economies. To mark the twentieth anniversary of this historic event, UNU-WIDER is organising a two-day conference to review the experiences of transition countries during the past two decades and to draw out possible lessons for the future.

Conferences: 18 September 2009 WIDER Conference on Reflections on Transition: Twenty Years After The Fall of The Berlin Wall

Recent decades have seen a surge in South-South economic, social and political linkages. These activities have largely focused on mobilising resources in the areas of trade, finance, and the provision of development and technical assistance. This project seeks a better understanding of the nature and potential of two elements of emerging south-south relationships in particular. The first element of the project focuses on how south-south linkages have affected the global financial architecture. A second element of this project is regional integration and trade agreements.

In the development literature, some countries are cited more often than others as examples of development success. These countries are believed to have policies and institutions that could be transferred, at least in part, to less successful countries both within their own regions, and elsewhere in the developing world. As such they might be said to constitute 'role models of development'. The project will examine individual cases of development success to understand better their root causes, and whether (and how) these experiences are transferable to today’s poorer countries.

The project centers on the inter-linkages between the major developing countries of Brazil, India, China and South Africa and the global economy, with a special emphasis on the implications of China’s growth on smaller economies and the rest of the world. The research areas include changing patterns in trade, FDI, and commodity prices. Both positive and negative impacts are to be identified and implications for foreign policies of various nations and international governance are to be explored.

In recent years there is a growing concern within the international donor community regarding the plight of a special group of countries labeled as 'Fragile States'. These states, which according to current donor lists currently numbers more than 40 countries, are diverse in many respects. But, compared with other aid-receiving countries, all are thought to use aid poorly and to have lower capacities to absorb aid efficiently due to having especially bad policies, especially weak institutions or both. This project looks at aid and related governance issues in these countries.

UNU-WIDER’s recent project ‘Hunger and Food Security’ exerted a strong attraction for academia, international organizations (FAO, WFP, and UNCTAD), civil society organizations, and the media. The first project meeting, held in Jaipur in March 2005, concluded that the gender dimension of food security demands special attention. The “Gender and Food Security” project will examine the effect of the status of women relative to men on various aspects of food-security.

In 2003, UNU-WIDER launched its project on Designing Africa’s Poverty Strategies: Creating the Capacity for Policy Simulation to develop economic modelling capacity in African countries. The project director provided regular training workshops (14 workshops) and on-going technical support to research teams from Botswana, Cameroon, Ghana, Mozambique, Nigeria, Namibia, South Africa, Tanzania, Uganda, and Zambia that enabled country teams to build microsimulation models of tax and transfers or macroeconomic models of their economies.

The purpose of this project was to investigate issues related to health inequality. Although health is an important indicator of overall wellbeing, it is only recently that research has focused on health inequality. This project brings forth issues related to measurement of health indicators, establish composite indexes of health status, conduct rigorous empirical work on both trends and causal factors behind health inequality within and between countries, analyze the implications of health deprivations on poverty traps and suggest practical policies which can be implemented without much difficulty.

Aid is one of the most challenging development issues facing the international community. There is now a pressing need to evaluate performance to date, and the future for aid in light of recent events such as the post-Monterrey consensus to substantially increase aid to meet the Millennium Development Goals, recent initiatives from donors, and an ongoing focus on Africa, among others. The project is timely given the agreement at the G8 Meeting in Scotland in 2005 to significantly expand aid flows and discussions around development finance at the UN Summit in September 2005.

About 200 participants attended the conference, more than 150 of them coming from outside Finland. The conference was open to younger researchers as well as established scholars. A list of participants is available on WIDER’s website.

Conferences: Jubilee Conference - WIDER Thinking Ahead: the Future of Development Economics

Presentations: 23 April 2007 Inaguration on Advancing Development

Conferences: 17 September 2004 EGDI-WIDER Conference on Unlocking Human Potential: Linking the Informal and Formal Sectors

The project aims to assemble data about the distribution and composition of personal assets in developing, transition, and developed countries and to study the implications of personal asset-holding for economic development. The most important asset types — financial assets, land and housing — will be given special attention. Life-cycle saving, self-insurance and other motives for saving, as well as their consequences for asset-holding, will also be studied.

The mobilization of domestic savings for private investment plays a crucial role in achieving growth and poverty reduction; this is demonstrated by the historical experience of the now developed countries as well as East Asia. However two problems have become apparent. First, the construction of regulatory and supervisory capacity has often lagged behind liberalization, and a number of low-income and transition countries have experienced major bank crises. Second, the domestic investment response to financial liberalization has often been disappointing and the newly liberalized systems have often not effectively intermediated savings into new and higher levels of domestic investment.

Getting an accurate picture of poverty and inequality trends and patterns in the world’s most populous country is central to understanding changes in global inequality and poverty – these alter significantly when China is included or excluded. China’s future performance is obviously central to the achievement of the MDGs at a global level as well and, given the country’s rapid integration into the global economy, an accurate assessment of China’s poverty and inequality is important to the wider debate on globalization’s effects.

International development in the era of globalization needs an effective transfer of knowledge and human capital from the main centres of knowledge creation to developing countries for supporting their growth and development process. Most of the new knowledge is embodied in people. Developing countries create their qualified human resource base at home and developed countries ‘import’ technical expertise from abroad. This process has raised concern, particularly in developing countries. This process, however, needs not be irreversible as people tend to return to their home country bringing with them knowledge and experience thereby contributing to national development.

Achievement of the MDG goals by 2015 is an ambitious undertaking. The donor community is now mobilizing resources behind the goals, and efforts to implement the goals are now underway at national and international levels. It is inevitable that progress in achieving the goals will vary considerably across developing regions, and indeed within individual countries. Activities to monitor the achievement of the goals both globally and nationally are now being put in place by international agencies. This is a highly demanding task, particularly in the area of collecting the relevant data which will require much faster progress in building the capacity of national statistical agencies.

Development aid has become an increasingly hot topic in international research and policy circles, especially following the adoption of the Millennium Development Goals. Donors are paying increased attention to how they allocate aid across countries. Consisting of three linked activities, the project builds on expertise in aid and related areas of research among current WIDER resident researchers. WIDER possesses a very strong comparative advantage in this area, and is in a position to lead the development aid research effort internationally. It also builds on the many strategic contacts of the two project directors in policy and research circles.

Millions of people remain desperately food insecure, and over a decade of agricultural-sector reform appears to have achieved little in the way of improving entitlement to food in many countries. This project will investigate why progress in achieving food-security has been disappointing in so many countries (especially in Africa) despite the implementation of extensive donor-inspired reform in agriculture, and the possibility of transferring lessons learned from the successful reduction of hunger in many parts of Asia.

See publications for work connected to this project.

Creating better institutions for development has come to the fore in recent years, reflecting the often poor results of economic reform programmes that failed to take account of the need to develop appropriate supporting institutions. This project looks at the role of institutional reform in accelerating development through an in-depth investigation of the historical experiences of the now-developed countries, as well the success stories among the developing countries (thereby drawing practical lessons for institutional change elsewhere in the developing world).

Globalization offers new opportunities for accelerating development and poverty reduction. And there is much concern about the distribution of benefits; in particular whether the poor gain from globalization, and under what circumstances it may actually hurt them. This project aims at producing rigorous theoretical and empirical analysis of the poverty impact of globalization, thereby providing a framework upon which to build strategies for 'pro-poor globalization'. The project is interested in understanding better the mechanisms through which globalization ultimately affects poverty.

Reconstruction from conflict is a complex and demanding task, and a major challenge for the UN system as well as the wider donor community. National authorities and their donor partners are faced with multiple priorities - rebuilding infrastructure, assisting war-damaged communities, and re-creating weakened institutions - with often insufficient resources to meet these needs.

Project duration: 3 years

The scale and causes of international income inequality and poverty continue to be much debated. Yet, the quality of the analysis and data underlying this debate still leaves much to be desired. Accordingly, this project will collate poverty data to make these easily available, in the manner of the successful UNU-WIDER World Income Inequality Database (WIID). A wide variety of policy relevant studies including cross-country analyses of the determinants of poverty and income inequality, and the role of income inequality in determining development outcomes, will be undertaken.

Conferences: 6 September 2003 WIDER Conference on Sharing Global Prosperity

Summary measures of human well-being are increasingly used to compare and monitor performance within and across countries. The UNDP's Human Development Index (HDI) is one of a number of measures which have done much to refocus attention on the importance of non-monetary measures of human progress. This project aims to provide guidelines for the future design and practical application of human well-being indicators by taking stock of and reviewing current practice. This project builds on previous UNU-WIDER research which emphasized the importance of achieving broad-based recovery from conflict.

Many developing and transition countries have considerable regional variation in average household income, poverty, and health and educational status. National human development indicators can therefore mislead policy-makers when large regional disparities exist. This project will investigate the size and determinants of regional disparities in a representative selection of countries. It will use indicators such as poverty incidence and depth, within-region income inequality, human development, and gender indicators to better understand why some regions fall behind in the development process.

The real value of official aid flows fell for much of the 1990s, and private capital flows to low-income countries remain mostly limited. The decline in aid flows may endanger the development process, since they finance much of the development budget in many poor countries. However, while aid in aggregate is in decline, some have argued that better use is now made of each aid dollar, so the decline in aid flows may have been partially offset by an improvement in its quality. This project looks at the likely outcomes for the levels, structure, and effectiveness of official flows.

When the Uruguay Round was being negotiated and it was coming to a close, a number of estimates were made about the impact of the agreement on poor countries. Many assessments indicated that there would be a net loss for them while others came up with a more positive scenario. Now that the agreement has been in place for several years there is scope for an empirical assessment of the issue to identify the winners and the losers ex post. The project makes recommendations to improve the participation of the least developed countries in international economic policy regimes, especially the WTO.

Members of the CFA-zone enjoy currency convertibility, fiscal and monetary policies which are more prudent than SSA as a whole, and a large amount of financial and technical assistance. These advantages do not appear, however, to have resulted in more rapid economic and human development in the CFA-zone and CFA countries in the Sahel face major structural handicaps. This project aims to understand why CFA-zone performance has been disappointing given the advantages enjoyed by the region, and will devise policy recommendations to improve longer-term development.

A joint project with the United Nations Department of Economic and Social Affairs (UN-DESA) in response to the UN General Assembly call for a rigorous study on ways to increase external finance for developing countries, particularly to meet the MDGs. Topics include: environmental taxation for development; revenue potential of the Tobin tax; Special Drawing Rights; the International Finance Facility; private donations for development; a global lottery and a global premium bond; remittances by emigrants; global public economics; national taxation, fiscal federalism, and global taxation.

Fleeing poverty, violence and 'ethnic cleansing' millions of people leave their homes every year in search of safety and economic opportunities. In contrast to the migrations of the nineteenth century today's migrations often take place through illegal channels. Such migration is therefore very difficult to control and tends to be an important new source of poverty, social exclusion and social deviance. The project aims to document the extent of this phenomenon, to assess its economic and social impact on sending and receiving countries, and to develop humane policy recommendations.

Conferences: 25 May 2001 WIDER Development Conference on Growth and Poverty

Conferences: 17 August 2001 WIDER Development Conference on Debt Relief

Households in developing countries face many risks. Informal insurance mechanisms (marriage, the extended family, and investment in social capital) provide some protection but are weak in the face of major calamities that affect households en masse. Most people cannot obtain formal insurance. The incomplete insurance market therefore constrains investment, growth, and poverty reduction. Public action to remedy this deficiency is merited, but what form should it take? The project will evaluate alternatives in widening insurance provision, including sustainability and poverty effects.

Micro-simulation models play an important role in policy analysis in developed economies, particularly in connection with the distributional impact of tax and benefit reforms. The objective is to show how the changes affect different households in different ways, and to assess the overall impact on individual living standards, poverty rates, and other indicators of household well-being. The project will aim to produce studies assessing the distributional impact of past changes to the tax and benefit structure, and possible future changes to programmes such as pensions and housing subsidies.

Many developing countries are characterised by weak budgetary and revenue institutions, insufficient public spending on priority investments and the macro-economic instability associated with repeated fiscal crises. Moreover, the recent external review of IMF ESAF lending concluded that IMF fiscal policy conditionality might in some cases work against aid effectiveness. This project will re-examine the design of fiscal policy (including public expenditure management and taxation) with the aim of improving its role in supporting growth and poverty reduction.

A property rights regime covers rights to use, lease, donate, bequest, and sell assets or collect the incomes generated by assets. A clear and transparent property rights regime facilitates investment and economic growth. While private property is considered by many to be the most superior type of regime, this is not always the case, especially when important markets are imperfect or missing and when key institutions are underdeveloped. This project will evaluate alternative property rights regimes at different development stages.

Latin America has now privatised a large number of utilities (water, electricity, transport, and telecommunications) and now makes more use of market approaches to delivery in the social sectors (education and health). Privatisation has major consequences for efficiency (and therefore long-term growth), consumer welfare and income distribution. But insufficient attention has been paid to regulating privatised enterprises in the public interest. The project will assess how privatisation and regulation processes can be improved, particularly in the light of experience elsewhere.

Project Meetings: 12 January 2001 Project meeting: The New Economy in a Global Perspective

Conferences: 10 May 2002 WIDER Development Conference on New Economy in Development

The project intends to fill the gaps in knowledge in two related areas: 1) what determines decisions by lenders/investors to enter or withdraw from individual developing countries? 2) what are the policy implications for macroeconomic and financial regulation policies of volatile and reversible capital flows? The project will consist of two parts: 1) analysis of new trends in the supply of different categories of capital flows since the Asian crisis and 2) evaluation of national policies to reduce both the volatility of capital flows and its' negative domestic impact.

Previous UNU-WIDER research has shown that the risk of internal conflict is high in low-income societies rich in natural resources and characterised by ethnic fragmentation. Yet for each country in conflict there are many others with similar characteristics that are at peace. Understanding why some countries avoid conflict while others fail is critical. The project will focus in particular on the impact of different patterns of public expenditure, the distribution of government jobs and the overall benefits of government operations in social stability and integration.

Past policies, an erroneous approach to adjustment, and 'geography' are repeatedly cited as explanations for Africa's poor performance. But, weaknesses in the institutional capacity of the African State may be as important. In particular, economic policies continue to be donor-driven in many cases, with a lack of local ownership. This project will conduct a systematic analysis of institutional constraints and ownership issues, including analysis of specific programme and project successes and failures when local ownership has been encouraged/permitted.

A key challenge for policy makers is how to bring about the successful integration of the less developed countries into the international system. Many of the obstacles to the meaningful participation of vulnerable developing economies in the international system are domestic in origin, but external factors beyond the control of these countries play an important part as well. The project identifies and analyses these factors and develops policies that could ameliorate the domestic obstacles and help overcome the external constraints.

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It is a widely held opinion among policy-makers and social scientists that the so-called 'information revolution' is having a substantial impact on the world economy. It is often also presumed that this impact is beneficial to all those countries having the necessary infrastructure for the adoption of IT. The policy implication of this line of argumentation is that governments should assign priority to high-tech industries and promote public investment in the related infrastructure.

In a world beset by the effects of the Great Depression and war, the 'Keynesian message' strongly inspired the post-war policy agenda and the structuring of the UN/Bretton Woods system. In contrast, an increasing gap has been emerging between the changing problems of the world economy on the one hand and the policy agenda and the ability to govern of world institutions of the other. The need for stronger governance has been heightened by the emergence of supranational problems which have brought to the fore the limitations of national states in dealing with the new challenges.

The single European currency, the euro, implies deep changes in the pattern of economic integration in Europe, as well as in the world financial system. These changes will have important consequences on developing countries as well. In Europe, the move to a single currency will pose new policy challenges both at the national level and at the European level. Countries with an economic structure different from the European core structure face a risk of asymmetric shocks. To countervail these, they need efficient fiscal stabilizers and highly flexible labour markets.

Over the last several years, the donor community has increasingly focused its efforts on poverty eradication. Meanwhile, income inequality appears to have been rising in many developed, developing and transitional countries. Economic theory explains only poorly the rise in inequality over the last 20 years or so and the relation of this rise to poverty alleviation. Thus, it is quite possible that poverty reduction - and growth itself - may be compromised if inadequate attention is paid to the policy objective of the maintenance of income inequality within an acceptable range.

The development prospects in SSA are particularly problematic in those countries which adopted Soviet style planning in the 1970s, i.e. Angola, Congo, Eritrea, Ethiopia, Guinea, Guinea-Bissau, Mozambique, and Somalia. The policies of these countries emphasized state intervention in agriculture, capital-intensive industrialization, and macroeconomic management. These countries also experienced extreme levels of political violence and destruction as a result of either internal tensions or the politics of the Cold War. Economic progress in this group of countries thus faces distinct problems.

In the top and bottom ranks of the GDP/c league, one finds countries which are completely devoid of natural resources, as well as others where the natural wealth of the country has played an important role in development. The evidence reviewed in the literature suggests that a rich endowment of natural resources hampers export diversification, the development of human capital and the protection of the environment. However, there is no a priori reason why the advantage constituted by a plentiful supply of natural resources must necessarily become an economic curse.

Institutions, such as firms, families, contracts, rules, regulations, values, and social norms, are fundamental for economic development. They influence both the level and the pace of economic growth, which can and frequently does trigger institutional change. Institutions can neither be ignored, nor taken as a given, as in standard modern economics, which emphasizes rational economic behaviour and the rational economic man (REM). This REM approach, however, leaves much unexplained in terms of economic performance and individual behaviours.

Much of the discussion about privatization in the former socialist economies has focused on the divesture of state-owned enterprises (SOEs). While this approach has been inspired by the belief that privatization will solve all production and incentive problems, its benefits are now being reassessed more critically. Much less attention has been paid to the conditions necessary for the development of the NPS and on its role as 'the engine of the transition'. Yet, successful performance during the transition appears to be increasingly dependent on the expansion of this new sector.

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See publications for work connected to this project.

See publications for work connected to this project.

See publications for work connected to this project.

See publications for work connected to this project.

See publications for work connected to this project.

See publications for work connected to this project.

With the introduction of Poverty Reduction Strategy Papers (PRSPs) and Millennium Development Goals (MDGs), governments in Africa and other developing countries have been under great pressure to devise effective policies that will reduce poverty and inequality. Financing and targeting public spending for poverty reduction require mobilisation of considerable revenues and reliable forecasts. While microsimulation modelling techniques have been important tools for analysing and devising tax and transfer policy reforms in most industrialised countries, this has not been the case for Africa. Microsimulation models for four African countries: Botswana, Uganda, Nigeria and Cameroon

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