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Governance and Political-Economy in WBG Growth Analysis

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Governance and Political-Economy in WBG Growth Analysis. Kai Kaiser & Shahrooz Badkoubei Applied Inclusive Growth Analysis Day 4, March 26, 2009. Binding Constraints in Practice. Survey of Recent CEM Practice FY 2007-8: Grey/Quasi-Grey Cover Desk Review & Follow-up Dialogue with TTLs

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Governance and Political-Economy in WBG Growth Analysis

Kai Kaiser & Shahrooz Badkoubei

Applied Inclusive Growth Analysis

Day 4, March 26, 2009

binding constraints in practice
Binding Constraints in Practice
  • Survey of Recent CEM Practice
    • FY 2007-8: Grey/Quasi-Grey Cover
    • Desk Review & Follow-up Dialogue with TTLs
  • Various Methodologies
    • 8 HRV Approach
    • 1 Multidimensional
  • Policy Priorities Varied
    • Growth focus: acceleration, diversification sustainability, inclusive, pro-poor…
objectives
Objectives
  • Identify Reform Challenges in Practice
    • Country Specificity
  • Examine how GPE being addressed for country growth policy dialogue
  • Develop resource materials for task teams
caveats
Caveats
  • CEM Categorization Only Indicative
    • Many CEMs don’t use explicit (HRV) binding constraints to growth methodology
    • Constraints time-specific
      • Impacts of Global Economic Crisis
  • GPE Dialogue May Be Off-Line
    • Not explicit in Grey Cover CEMs
    • Implementation counterparts problem…
gpe second best institutions
GPE & “Second Best” Institutions
  • Differentiate Form from Function
    • E.g., China’s Reforms
  • Shift from Normative/Presumptive
    • Good Enough Governance (Grindle)
    • Contextual Fit

 Which forms are effective and politically feasible?

findings
Findings
  • Governance, Political-Economy, Institutional Issues Inherent to All Binding Constraints
    • Addressing constraint requires technical & GPE skills
  • “Governance/micro-risks” identification and remedies diffuse
    • Clarify terminology
    • Sharpen diagnostics
  • Need to document value added
    • Don’t erode CEM “objectivity”
    • Led to alternative/succesfull engagement
resources
Resources

Governance & Political-Economy for Growth Analysis SharePoint Intranet Site

http://connect.worldbank.org/units/prem/PD-GPEA/pdgpe/default.aspx

Selected References

Rodrik, Dani, (2008), Second Best Institutions, Cambridge, MA: Harvard University (mimeo)