Arvind Subramanian says we should reorient the World Bank towards public goods:
It is awfully hard to find evidence that traditional World Bank–type aid works. In a series of papers, Raghuram Rajan, former chief economist of the IMF, and I were unable to find any positive effects of aid on long-run growth but did find evidence consistent with some of the negative effects of aid in depressing manufacturing exports and worsening domestic institutions.
On the other hand, it is widely accepted that some of the biggest contributions to development have come from global public goods such as the green revolution and medical breakthroughs, especially related to the development of antibiotics and vaccines…
India should rather put forward a new vision for the World Bank, with a central focus on global public goods, a point also emphasized and elaborated by Devesh Kapur, the author of the definitive history of the Bank. Nancy Birdsall of the Center for Global Development and I have argued that the governance structure for global public good activities should be quite different from current arrangements. This could be the thin end of the wedge for perhaps eventually breaking up the World Bank into two institutions: first, an aid agency devoted to traditional lending activities that could continue to be dominated by the G-7; and second, a new institution that focuses more on the creation of global public goods, one in which middle income countries such as India, China, and Brazil could start making greater financial contributions and, in return, obtain commensurate power and influence.
In the latest Foreign Affairs, Barry Eichengreen says that the US dollar will stay the world’s top currency.
Is the World Bank’s simultaneous funding of tiger habitat conservation programs and coal-fired power plants in India cognitive dissonance or merely convexity of preferences? The Bank only looks silly if they are neglecting an obvious and cheap alternative that would let them have both power and tigers another way.
Per Kurowski on the World Bank’s fight against corruption:
[P]lease search out INT on the external website of the World Bank and then click on the list of Debarred Firms and Individuals. On that list you will find, duly named and shamed, the names of many individuals that one way or another after a due process have been considered involved in corruption, but that list does not include one single name of those officers of the World Bank that presumably must also have been involved in these acts of corruption one way or another. Susanne Folsom the Director of INT, on a Q&A session on that same site mentions, “We’re often asked why we don’t publicly name Bank staff who are terminated for fraud and corruption as well. The Bank’s rules don’t allow such disclosures….” What credibility can you get naming others while not being willing to name your own?
At VoxEU, Peter B. Kenen summarizes the IMF’s reform progress.
Andres Opennheimer writes:
There would be dozens of qualified candidates for the top IMF job from emerging countries, who would not make anybody nervous in the U.S., German or British treasuries.
Among others: former Mexican President Ernesto Zedillo; former Brazilian Central Bank President Pedro Malan; former Argentine Central Bank Gov. Mario Blejer; India’s planning minister, Montek Singh Ahluwalia; or the former chairman of Poland’s National Bank, Leszek Balcerowicz.
Any of them would be a more credible broker of future financial crises, a more even-handed monitor of the world economy, than Sarkozy’s candidate.