The Research Academy identifies and shares the findings of the best new policy-relevant research from across the World Bank Group. The 2014 Academy was sponsored jointly by the Research Director, Asli Demirguc-Kunt, and the Global Practices Chief Economist, Jeffrey Lewis.
Winners | Call for Papers
The Best New Research from across the Bank: Winners of the 2014 Research Academy
Global Practices Chief Economist, Jeffrey Lewis, and Director of Research, Asli Demirguc-Kunt
January 5, 2015—Following a Bank Group-wide call for submissions, the 2014 Research Academy has identified the best new research from across the institution. Jointly sponsored by DEC’s Research Department and the Office of the Global Practices Chief Economist, the competition identified the top three new working papers based on their technical quality, originality and policy relevance.
“This is what good research does: takes advantage of different strengths from across the institution and includes collaborators from outside,” said Kaushik Basu, Senior Vice President and Chief Economist. “The results are there for all to see—three persuasive papers on a range of topics all relevant to the Bank Group's central mission.”
“Research plays a crucial role in both learning from past policies and thinking about the future, informing the advice we provide to our clients,” agreed Asli Demirguc-Kunt, Director of Research. “But it takes a certain amount of discipline to produce research papers, so the Research Academy is an effort to recognize and therefore motivate more research all across the Bank Group.”
Jeffrey Lewis, Global Practices Chief Economist added, “These three winning papers—addressing critical health, infrastructure, and corruption topics—are excellent examples of how we can bring cutting-edge research to bear on critical development challenges.”
Special thanks go to all the World Bank staff who gave their time to help select the winning papers: Abebe Adugna, Paulo Bastos, Toan Do, Roberto Fattal Jaef, Joel Hellman, Eeshani Kandpal, Martin Kanz, Ha Nguyen, William Rex, Halsey Rogers, Claudia Ruiz, and Damien de Walque.
Winning Papers: 2014 Research Academy
Counting the High Costs of Corruption
In 2011 Ben Ali, President of Tunisia, was ousted from office after 15 years in power. The Ben Ali clan’s widespread business interests were by no means secret, but just how much had they profited from these interests? And exactly how did the clan manage to build such a vast business empire?
Bob Rijkers (Economist, Development Research Group), Caroline Freund (Peterson Institute for International Economics), and Antonio Nucifora (Lead Economist, Macroeconomics and Fiscal Management Global Practice) had to go out on a limb to tackle these questions. They worked with Tunisia’s National Statistical Office to gather previously inaccessible data, including which firms were owned by the clan and confiscated after the Arab Spring as well as official tax records. What they found is stunning: the 220 firms connected to Ben Ali and covered in the study appropriated 21 percent of all net private sector profits in Tunisia.
The researchers also conclude—unsurprisingly—that firms connected to Ben Ali did not achieve this stunning profitability through superior management skills. Rather, they abused the law. Tunisia’s investment code benefitted connected firms by creating monopoly rents, shutting down existing competitors, and keeping out potential entrants. When existing regulations did not suffice, Ben Ali simply invented new ones and used presidential decrees to implement them. The clan got rich by making the law, not by breaking it.
The costs of state capture were enormous, and included not only the transfer of rents to the president and his family, but also higher costs to consumers as connected firms shielded from competition charged excessive prices . “Tunisia’s story serves as a cautionary tale,” said Rijkers. “Highly interventionist industrial policies may be easily abused in the absence of checks and balances on political power.”
Read the winning paper: All in the Family: State Capture in Tunisia
A Highway to Success: The Impact of India’s Golden Quadrilateral Project
Investments in transportation infrastructure are often touted as fundamental for economic development. But quantifying the impact of transport investments has been difficult. India’s Golden Quadrilateral (GQ) highway project provided a perfect opportunity to shed light on the issue. A team of researchers—Ejaz Ghani (Lead Economist, Macroeconomics and Fiscal Management Global Practice), Arti Goswami (Economist, Social, Urban, Rural, and Resilience Global Practice) and William Kerr (Harvard Business School)—jumped at the opportunity.
India initiated the Golden Quadrilateral (GQ) highway project in 2001 to upgrade nearly 6,000 kilometers of highways linking four major urban hubs. An upgrade project was also slated at the same time for the North-South East-West highway system—comparable in many ways to the GQ highway—but was postponed. The delay provided the researchers a natural experiment that helped them tease out the impact of the GQ project separately from other trends taking place in India’s economy.
The researchers looked at the impact of the highway project on a range of metrics of the performance of the formal private sector, and what they found was remarkable.
The GQ project increased manufacturing output by nearly 20 percent between 2000 and 2010, above and beyond the general increase in Indian manufacturing output taking place at the time. This increase in output was driven by a range of factors, including higher rates of entry of new firms into the market, higher labor productivity and a more efficient geographical sorting of industries. The project also encouraged a decentralization process as intermediate-size cities became more attractive destinations for firms. “Our findings should provide encouragement to policy makers in developing countries that are weighing their options for investments in transportation infrastructure,” said Ghani. “The overall benefits in terms of output are clearly substantial, and this is matched by a more dynamic, efficient and productive private sector.”
Read the winning paper: Highway to Success: The Impact of the Golden Quadrilateral Project for the Location and Performance of Indian Manufacturing
Unevenly Shared Progress on the Health-Related Millennium Development Goals
Little more than a year remains until the target date of December 31, 2015 for achievement of the Millennium Development Goals (MDGs). The majority of countries have been making progress on the health-related MDGs, but have the poorest been sharing in these gains?
Adam Wagstaff (Research Manager, Development Research Group), Caryn Bredenkamp (Senior Economist, Health, Nutrition, and Population Global Practice) and Leander Buisman (Erasmus University, Rotterdam) teamed up to take a closer look at this often-asked, but understudied question. The authors pick up on the idea of shared prosperity—normally defined as growth of incomes of the bottom 40 percent—and apply it to the health sector by ranking households based on their wealth and examining the progress of the bottom 40 percent of households on the health-related MDGs over a two-decade period.
Drawing on data from over 200 surveys, the researchers find that in a majority of countries the poorest 40 percent have been making faster progress on the health-related MDGs than the richest 60 percent. Improvements in rates of antenatal care provide some of the best news—progress has been faster for the poorest in more than 80 percent of countries.
But the story is not all positive. There are still a large number of countries where the poorest 40 per cent have progressed less quickly than the richest 60 per cent, contributing to growing relative inequality. This is especially true of indicators of child health status (like malnutrition and mortality, where the fraction in this category is 40 – 50 percent), but also true of some intervention indicators (for immunization, the figure is almost 40 per cent). In some countries, for some indicators, the poor have not even made progress in absolute terms. Even worse, some countries have seen complete reversals on certain health-related MDGs; in one quarter of countries, rates of measles immunization have actually fallen.
“Our findings point to the fact that it won’t be enough to simply monitor overall progress on health goals as part of the post-2015 development agenda—the distribution of progress needs to be monitored as well,” said Wagstaff. Bredenkamp also highlighted a second implication of their work: “The apparent disconnect between pro-rich results on a number of health outcome indicators and pro-poor results on interventions suggests that more attention is needed on monitoring not just the delivery of care but also the quality of healthcare received.”
Read the winning paper: Progress toward the Health MDGs: Are the Poor Being Left Behind?
Research Academy 2014: Call for Papers
May 1, 2014 - The Research Department and the Office of the Chief Economist of the Global Practices invite World Bank Group staff and consultants to submit papers to the second round of the Research Academy on these five themes:
- Science of Delivery: Service Delivery and Aid Effectiveness
- Job Creation, Competitiveness, and Productivity
- Risk Management and Vulnerability
- Inclusion and Shared Prosperity
- International Cooperation and Global Public Goods
The Research Director, Asli Demirgüç-Kunt, and Global Practices Chief Economist, Jeff Lewis, convene a committee of rotating experts selected from across the World Bank Group based on the topic of submissions. The papers are reviewed in two rounds based on the following criteria: (1) technical quality; (2) originality; and (3) operational relevance. In the first round, each paper is rated by two members of the committee, and the papers with the highest average rating proceed to the second round. In the second round, each paper is rated by all members of the committee, and the winners are selected.
Deadline: June 9, 2014.