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15338 results in Economic development and growth

Page 341 of 767

  • Chapter 21 - Benefits and Costs of the Population and Demography Targets for the Post-2015 Development Agenda

  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 375-398

  • Summary

    Prioritizing the Post-2015 UN Development Agenda on Population and Demography requires a recognition that national demographic trajectories are currently more diverse than in the middle and late 20th century. Wealthy countries of Europe, Asia and the Americas face rapid population aging, while Africa and some countries in Asia prepare for the largest cohort of young people the world has ever seen. And many of the world’s poorest countries, particularly in sub-Saharan Africa, continue to face premature mortality, high fertility and often unmet need for contraception. The goal of this chapter is to discuss the Post-2015 Development Agenda in the area of Population and Demography, focusing primarily on aspects of population size, age structure and geographic distribution. Within population and demography, the priorities that have the highest benefit-cost ratios are: ● Achieving universal access to sexual and reproductive health (SRH) services by 2030, and eliminating unmet need for modern contraception by 2040. ● A reduction of barriers to migration within low- and middle-income countries, as well as between low- and middle-income countries and high-income countries.

  • 19.2 - alternative perspective

  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 366-366

  • Summary

    Summary

    Clots-Figueras addresses all of the relevant post- 2015 goals and reports on the most recent relevant experimental results having to do with explicit benefit-cost ratios (BCRs) for this gender-related research. However, the evidence base is restricted to experimental papers. This perspective suggests different views regarding how to measure and assess evidence regarding BCRs. This includes addressing the question of what elements are preconditions and what events are actually more likely to occur if economic situations for women are improved.

    The chapter ably demonstrates the advantages and limitations of benefit-cost analysis. It raises important questions such as whether the BCR should be seen as a lower bound because of the large, unmeasured spillover effects. For genderrelated outcomes in particular, it is unclear what the range of effects may be and whether they are all desirable. Increasing women's participation in the labor force, for example, is not necessarily an end in itself and may have other outcomes, some of which could be undesirable.

    Project-specific BCRs may also not scale up to society-wide policies. For example, educating too many people to fill the number of higher-level jobs available or providing microfinance to a start-up in an already crowded market may not be beneficial. On the other hand, small-scale studies could also underestimate the larger societal impact of policies. For example, a more educated population may lead to more efficient institutions and more efficient interactions with others.

    There are, however, other options. For instance, take a set of countries (or a pair of countries) that have different levels of social spending on a particular matter of interest, such as women's healthcare. We can then compare the different outcomes for such standard indicators as maternal mortality, infant mortality, and other health outcomes for both women and others (especially children). Combined with calculations of the monetary value of a DALY, this can then lead to a BCR calculation.

    Some of the most interesting historical examples involve two neighboring countries, often with a common cultural heritage, that then separate in terms of their social policy at some critical juncture. The division of Germany after WWII is a case in point; reunification showed how re-equilibration then occurred. Countries in different locations but with a common cultural background – Australia, the United States, and the UK, for example – provide other useful comparisons.

  • 25 - Good Governance and the Sustainable Development Goals: Assessing Governance Targets

    • By Mary E. Hilderbrand, Associate Professor of the Practice, George H. W. Bush School of Government and Public Service, Texas A&M University, USA and Faculty Affiliate, Center for International Development, Harvard University, Massachusetts, USA
  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 475-496

  • Summary

    Introduction

    Governance and institutions have been among the focal themes of planning for the post-2015 global agenda. The High Level Panel on the Post-2015 Development Agenda named building “peace and effective, open and accountable institutions for all” as one of “five big, transformative shifts” that its members saw as necessary for a new global development agenda (United Nations, 2013). The Secretary- General's report on the post-2015 agenda laid out six “essential elements” for integrating the numerous potential goals and targets: dignity (ending poverty and fighting inequalities); people (human development); prosperity (economic development); planet (environmental protection and climate change); partnership (global solidarity); and justice (promoting “safe and peaceful societies, and strong institutions”; United Nations, 2014b, italics mine). Thus, in contrast with the Millennium Development Goals (MDGs), the quality of governance and institutions is given a prominent place on the new global agenda.

    The focus on governance comes from two different perspectives. Some assessments of performance on the existing goals have blamed poor governance when results were disappointing, suggesting that improving governance is essential for making further progress (or sustaining progress) in areas such as poverty reduction, health, education, and water and sanitation. This view, then, sees governance and institutions as necessary means to get results on other development goals. Another perspective is that “good governance,” especially components such as participation, transparency, inclusiveness, and access to justice, is a part of development itself; thus, good governance is seen as a development goal to be pursued for its own sake, not just as a means to enable economic development. Both perspectives are reflected in the United Nations (UN) statements on the post-2015 agenda.

    Setting goals and targets for governance and institutions is difficult, and there are many problems and challenges associated with doing so. Whereas there is broad agreement that “good governance” (however that is defined) is preferable to poor governance, there is considerable disagreement over whether establishing specific goals and targets will lead to meaningful improvements in governance. If the motivation is based on the argument that governance is necessary to reach other goals, what do we actually know about the relationship between governance and development? If improving governance is important – whether as ends or means – is including it in the development goals likely to elicit the desired improvements? Setting targets implies being able to measure progress. Can we do that?

  • 25.2 - alternative perspective

    • By Matt Andrews, Edward S. Mason Senior Lecturer in International Development, Harvard Kennedy School, Massachusetts, USA
  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 499-500

  • Summary

    Summary

    I start from a position of skepticism of the value of having post-2015 goals at all and even more of including governance in such a set. Global-level statistics on the MDGs appear quite accurate, and progress in some areas is used to support the argument for such global goals. However, there is great variation at the national level, with one study, for example, showing that about 50 percent of countries are on track to meet extreme poverty, gender, child mortality, and water goals, but less than 30 percent are on track to meet hunger, maternal mortality, and HIV/AIDS goals.

    I draw several key lessons when considering this kind of evidence. First, higher growth countries did better in meeting MDG targets than lower growth countries, which could suggest that the development community should focus on fostering economic growth instead of promoting a new set of targets. MDG success is contextual and deeply affected by a country's social and economic situation. Second, progress has been greatest in areas where measured performance captures (mostly) logistical improvements. Building more schools and laying water pipes are largely technical exercises. Progress on sanitation issues, on the other hand, has arguably been slower because the logistical component involves more complex political and social interactions.

    A third lesson is that because targets focus on parts of the development process that can be seen and quickly assessed and not on the harder to see (and to do) and longer to achieve parts, there are likely to be large gaps between form and function (where performance only looks better). Many of the best-performing MDG countries now have many schools and high enrollment rates in schools, for instance, but also experience severe shortages of teachers and textbooks and major gaps between enrollment and achievement. There are also gaps within countries between rural and urban areas: the fourth lesson is that goals and targets can bias performance to easier concentrated urban areas, creating a gap between performance in these locations and the more distributed local, rural settings. A final lesson is that targets encourage promises – of budgetary priorities in particular – that often do not lead to actual follow-through, creating an execution gap that is not easily closed.

  • 5.2 - alternative perspective

  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 118-118

  • Summary

    Summary

    This perspective takes a look at three questions relating to the provision of more data via surveys. First, we ask whether surveys in poor countries have produced results, second, what types of users demand what types of data, and third, how much it would cost to close the remaining gaps in household survey provision.

    The International Household Survey Network (IHSN) database provides the most comprehensive information on surveys and censuses in low- and middle-income countries. The pace of survey data collection has accelerated rapidly across all regions, as has the trend toward making data open. Poorer countries actually produce significantly more household surveys each year and are more likely to put their data into the public domain.

    The demand for such data, and also for it to be openly available, is likely to come from citizens and international aid donors, and the evidence tends to support this. Countries receiving more foreign aid tend not to conduct more household surveys but are somewhat more likely to publish open data. More democratic countries are also more likely to publish their data.

    Jerven estimates a figure of $1 billion a year to produce an adequate data package to cover the MDGs. This seems to us to be a reasonable approximation, but what it neglects is that many of the middle-income countries included are wealthy enough to fully fund their own statistical services. Countries such as Kuwait, South Korea, and Chile, for example, are included in the figure. Recognizing the need for socioeconomic data, we would expect international development assistance to fund a substantial fraction of statistical costs for countries below a cutoff level and only a small share of costs above that level.

    The cut-off point should be somewhere in the range of $2,000–5,000 GDP per capita. Total data package costs would be $275 million for the lower limit or $510 million for the upper one. Thirty-six out of 52 countries with GDP per capita below $2,000 are in sub-Saharan Africa, and total annual survey costs for this region would be $276 million. We therefore suggest that the total amount of international aid needed to support this basic survey program is about $300 million. We should note that IDA already provides a substantial proportion of the funds, so the $300 million does not represent a marginal increase in aid required, but a total figure including some current funding.

  • 5.1 - alternative perspective

    • By Deborah Johnston, Reader in Development Economics, School of Oriental and African Studies, University of London, UK
  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 117-117

  • Summary

    Summary

    There is clearly an existing problem with development data provision. For example, even population figures may be uncertain because of undercounting of some groups in society, and changes to the statistical basis of GDP estimates can make large differences. Ghana became a middle-income country overnight when its estimated GDP doubled in this way.

    Food and Agriculture Organization (FAO) data on undernutrition – on which many poorer countries rely in the absence of official national statistics – has also been shown to be prone to significant errors.

    This matters because the post-2015 agenda is likely to have a far greater monitoring burden, and Jerven has shown convincingly that paying for a full set of development data is not feasible. The second issue is that, even if it was available, throwing money at the problem will not solve it. The problem of lack of statistical capacity is hard to solve, and the chapter also points out the opportunity cost. The Partnership in Statistics for Development in the Twenty-First Century (PARIS21) group estimates that there has been an increase in data-gathering exercises in Africa because of the MDGs, but a shift away from surveys not closely geared to them. As Jerven correctly argues, macroeconomic, labor, and agricultural statistics have suffered in particular.

    This chapter is a groundbreaking attempt to delineate the issue, map the extent of the problem, and make recommendations; essentially it is a wake-up call to the development community. It makes several important contributions, the most important of which is its careful enumeration of the costs of monitoring theMDG indicators. This quantification is extremely powerful in showing the need for prioritization of targets and indicators – and so is highly complementary to the Copenhagen Consensus exercise.

    Because there is not yet a definitive list of targets and indicators, a precise costing is impossible, but the chapter usefully lays out the likely minimumdata requirements. However, the cost of data analysis and utilization is excluded from these estimates, and this is, of course, a necessary requirement for the information to be debated by politicians and the public.

  • 18 - Returns to Investment in Reducing Postharvest Food Losses and Increasing Agricultural Productivity Growth

  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 322-336

  • Summary

    The 2008–2011 food price spikes brought the issue of postharvest losses (PHL) back to the forefront of policy debate, and observers are again calling for a reduction in PHL as a tool to feed the expanding global population. Food losses due to improper postharvest handling, lack of appropriate infrastructure, and poor management techniques have once again become a matter of serious concern. Food losses, defined as “any decrease in food mass throughout the edible food supply chain,” can occur in any point of the marketing stages–from production (e.g., crop damage, spillage), postharvest and processing stages (e.g., attacks from insect or microorganisms during storage), distribution, and retail sale until home consumption (e.g., spoilage, table waste; Rosegrant et al., 2013). Kummu et al. (2012) suggest an additional 1 billion people could be fed if food crop losses were halved, which could potentially relieve some of the pressure on the significant increase in production that would be required. Achieving lower levels of food losses, however, requires both investments in technologies that help prevent losses as well as in overall infrastructure. Understanding the magnitude of these investments and their impact is key to establishing that a reduction in PHL has, in fact, an impact on food security.

    Seeking to better understand the levels of investment required to effectively reduce PHL requires several steps. First, it is necessary to understand how infrastructure impacts losses. The second step is to quantify the levels of investments required. Third, a cost-benefit analysis of the required infrastructural investments is done to assess economic returns to PHL reduction. Results are subsequently compared to investments in agricultural research and development.

    Overview of the Postharvest Loss Debate

    A large number of papers have been published focusing on four aspects of PHL: (1) estimates of the magnitudes of losses, (2) the economic impacts of losses in general but also on the poor and the hungry in particular (Gómez et al., 2011), (3) alternatives to decrease losses through the use of both new and traditional technologies, and 4) the economic costs of losses as well as their remedies.

  • Conclusion

    • By Finn Kydland, Nobel Laureate in Economic Science, Henley Professor of Economics, University of California, Santa Barbara, USA, Tom Schelling, Nobel Laureate in Economic Science, Nancy Stokey, Frederick Henry Prince Distinguished Service Professor in Economics, University of Chicago, Illinois, USA, Bjorn Lomborg, Prague, 2018
  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 501-507

  • Summary

    Over the next 15 years the Global Goal targets examined in the research section of this book will help to direct somewhere in the region of $2.5 trillion to be spent on development assistance, as well as countless trillions in national budgets. As the members of the Eminent Panel that examined the research and made recommendations on the proposed targets, particularly in terms of value-for-money, we believe that it is important that those making funding decisions have access to information on costs and benefits.

    A natural political inclination is to promise all good things to everyone. This, in no small part, is how the United Nations ended up with 169 targets. All are well-intentioned.

    However, the analyses presented in this book demonstrate that some of the targets are less worthwhile, producing only a little more than $1 in social benefits per dollar spent, while others produce much higher social returns. After careful consideration and engagement with the research authors, we selected the 19 targets that we expect to produce the greatest benefits.

    The analyses suggest that if the United Nations (UN) concentrates on these top 19 targets, it could achieve $20 to $40 in social benefits per dollar spent. In contrast, allocating it evenly across all 169 targets would reduce the figure to less than $10.

    Targets that will help people directly through health benefits are worth championing. As we read about in Chapter 13, tuberculosis (TB) is a “hidden” disease. More than two billion people carry the bacterium that causes it. About 10 percent of those people will develop TB at some point, and about 1.5 million people each year die from TB. But treatment is inexpensive and, in most cases, highly effective. Spending a dollar on diagnosis and treatment is a low-cost way to give many more years of productive life to many people. Ebola and Zika may receive the headlines, but TB is a much bigger problem, and one that we recommend receives high priority.

    Reducing childhood malnutrition, described in Chapter 20, is another excellent target. A good diet allows children's brains and muscles to develop better, producing lifelong benefits. Wellnourished children stay in school longer, learn more, and end up being much more productive members of society. The available evidence suggests that providing better nutrition for 68 million children each year would produce over $40 in long-term social benefits for every dollar spent.

  • 22.1 - alternative perspective

    • By Kamal Saggi, Professor of Economics, Vanderbilt University, Tennessee, USA
  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 419-419

  • Summary

    Summary

    Saggi finds that the Maskus chapter provides a clear and convincing analysis of his chosen policy initiatives and there is little he disagrees with. Productivity is perhaps the most important determinant of a country's living standards in the long run. It can either continue producing the same with fewer resources or invest in R&D that delivers new or better products. In principle, developing countries could use the fruits of foreign R&D, but in practice conducting domestic R&D can facilitate exchange of technology by lowering transaction costs as new knowledge and technological change accumulates.

    To the extent that intellectual property rights in developing countries have been strengthened by ratification of the TRIPS agreement, incentives for R&D should have been strengthened worldwide. Numbers of patent applications have indeed grown rapidly, particularly in Asia and most especially in China, which now takes the global lead in patent numbers. This nicely mirrors the observed increase in R&D expenditures, but of course tells us nothing about the quality of the output or its economic value. Maskus's proposals, taken together, could help to boost the quality of R&D output.

    Because inventors can extract only a fraction of the value of their innovation and because R&D generates so many unforeseen externalities, it seems clear that market forces will tend to fund too little R&D. This makes a case for encouraging more, but policies are likely to produce more benefits if they increase research rather than development, which is likely to produce fewer spillovers.

    The author's views on the large welfare gains possible by allowing free movement of labor are correct. The case is the same as for capital: to allow all factors of production to be employed most efficiently by allowing them to move freely throughout the world. Loosening the constraint on international labor mobility allows the world economy to narrow the gap between the marginal products of labor in different locations and thereby increase world output. To set against this is the fact that source countries may lose out from the “brain drain.” This cannot be ignored because, although human capital externalities are difficult to quantify, this does not mean they are unimportant.

    In addition to Maskus's two proposals, Saggi suggests FDI as another potentially fruitful area for government policy.

  • Chapter 8 - Benefits and Costs of the IFF Targets for the Post-2015 Development Agenda

  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 171-191

  • Summary

    This chapter covers the important issue of illicit financial flows (IFF) and ways in which they may be addressed. The Sustainable Development Goals (SDGs) target to curtail IFFs (16.4) currently has no defined indicators. Discussions are ongoing, but there is a risk that policy focus is lost. The proposal made here is for a set of three indicators which offer clear policy prioritization, and are likely to exhibit very high benefit-cost ratios. We propose three sub-targets that are more precise than the SDG target 16.4, and provide a much better degree of accuracy, measurability and accountability. For each of the three proposed sub-targets, there is currently insufficient evidence to provide precise cost-benefit analyses. However, available data indicate that in even the most conservative scenarios, they are likely to exhibit high ratios of benefit to cost. The targets are: i. Reduce to zero the legal persons and arrangements for which beneficial ownership info is not publicly available; ii. Reduce to zero the cross-border trade and investment relationships between jurisdictions for which there is no bilateral automatic exchange of tax information; and iii. Reduce to zero the number of multinational businesses that do not report publicly on a country-by-country basis.

  • 6.1 - alternative perspective

    • By Caroline Krafft, Assistant Professor of Economics, St. Catherine University, Minnesota, USA, Paul Glewwe, Professor of Economics, Department of Applied Economics, University of Minnesota, USA
  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 141-141

  • Summary

    Summary

    Overall, we generally agree with Psacharopoulos on the value of improving school quality, and we share his skepticism of vocational and technical education. Yet we would also argue that the evidence for expanding preprimary and primary education in sub-Saharan Africa is not as strong as he claims.

    The task set is a very difficult one, and we question the very idea of this undertaking, largely because the field of education suffers particularly from output-driven goals rather than outcomes. Setting goals that focus on outputs or proxies, such as enrollment rates, creates an incentive to attain that specific goal, which will not necessarily lead to the essential goals or benefits of education, such as human capital, knowledge, and skills.

    It is this “how to proceed” that is crucially absent from Psacharopoulos's chapter. For instance, improving school quality by increasing student test scores is stated to have a benefit-cost ratio between 3.0 and 5.0, but how to improve test scores and school quality is effectively not discussed. Even if ways to achieve more years of schooling can be found and costed, calculating the benefit-cost ratio can be misleading given the lack of data on externalities, measurement errors (particularly in developing countries), the absence of the selfemployed from the estimate, and the inclusion of government workers, whose salary reflects government policy rather than productivity.

    We are therefore concerned about the likely inaccuracy of the quoted figures. This is compounded by the low quality of the evidence presented (and perhaps the quality of evidence available). A further factor is the uncertainty around estimates and potential outliers. In particular, the benefit-cost ratio of preschool programs in sub-Saharan Africa is based on a study in Kenya, with a ratio an order of magnitude higher than others, with no adequate justification.

    A weakness of the chapter is that it provides no economic justification for public subsidy of education because social rates of return quoted are lower than private rates of return. Although Psacharopoulos alludes to wider social benefits, he is not able to provide sufficient hard evidence to support his case.

    Research from developed countries shows that the best investment a country can make is likely to be in preprimary education, particularly for disadvantaged children. This is the most cost-effective stage to invest in, and the opportunity cost of children's time is low at this age.

  • 2 - Targets for Biodiversity and Deforestation

    • By Anil Markandya, Honorary Professor of Economics, University of Bath, UK and Distinguished Ikerbasque Professor of the Basque Centre for Climate Change in the Basque Country, Spain
  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 38-49

  • Summary

    Background

    The Millennium Development Goals (MDGs), set up in 2000, tracked a number of indicators for sustainable development to 2015. Some of the goals, such as halving the poverty rate, have been met, and considerable progress has been made on others. Overall they are seen as a successful way of focusing attention and mobilizing resources to address the major gaps in human development, including those relating to the environment. The post-2015 agenda seeks to replace the MDGs with new goals that “move beyond meeting basic human needs and promote dynamic, inclusive and sustainable development” (CIGI, 2012).

    Biodiversity and deforestation are primarily covered in proposed Goals 14 and 15, dealing with marine and terrestrial resources, respectively. These targets draw significantly on the Aichi Targets that were adopted as part of the Convention of Biological Diversity's (CBD's) Strategic Plan for Biodiversity 2011–2020, in Nagoya, Japan, in 2010 (see Table 2.1). However, there are differences between the two sets: the Aichi Targets include more quantitative values than the Sustainable Development Goals, and the SDGs cover a broader range of topics. Because the SDGs in this area are not quantitative and so cannot be adequately costed, this chapter looks in detail at the Aichi Targets and estimates the net benefits of those that are able to be evaluated in monetary terms.

    The Aichi Targets

    In this section the full set of 20 targets is discussed and a qualitative assessment made of the net benefits they provide (Table 2.1).

    The CBD and the United Nations Environment Program (UNEP) have grouped the targets into five strategic goals:

  • A. Address the underlying causes of biodiversity loss be mainstreaming it across government and society (Targets 1–4)

  • B. Reduce the pressures on biodiversity and promote sustainable use (Targets 5–10)

  • C. Improve status of biodiversity by safeguarding ecosystems, species, and genetic diversity (Targets 11–13)

  • D. Enhance benefits to all from biodiversity and ecosystem services (Targets 11–16)

  • E. Enhance implementation through participatory planning, knowledge management, and capacity building (Targets 17–20)

  • 3.1 - alternative perspective

    • By Robert Mendelsohn, Edwin Weyerhaeuser Davis Professor of Forest Policy, Professor of Economics, and Professor, School of Management, Yale University, Connecticut, USA
  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 64-65

  • Summary

    The optimal solution to the greenhouse gas problem minimizes the sum of the climate damage and the cost of mitigation over the long run, but the current UN initiative is not even close to achieving this. There are three key insights that emerge. First, mitigation cost should be balanced against climate damage; second, as marginal damage increases with higher concentrations of greenhouse gases, so marginal cost should also rise; and third, the marginal cost of mitigation should be equated across all emitters.

    However, there are serious political difficulties, as the objective for each country is not necessarily what is best for the world overall. Thus, without international cooperation, individual countries have very little incentive to reduce emissions. Damages and costs are very difficult to estimate, and lowest cost strategies call for long-term commitments, which are alien to most politicians and voters. The long delay between action and damage also raises questions about discounting.

    Developed and emerging economies are each responsible for about 45 percent of emissions and must do most of the mitigation. But there is no silver bullet, and a portfolio of technologies is needed. Energy conservation, a move from coal to gas, renewable energy sources, bioenergy, and nuclear power can all make contributions. Carbon capture and storage is also an important part of the solution, but the feasibility of the technology on a large scale must still be assessed. Finally, using forests for sequestration is cost effective, but using woody biomass as part of a BECCS solution is expensive.

    The most important insight from economics is that the cost of mitigation rises rapidly the more stringent the target. The cost of meeting a target of a maximum 5°C rise is about $10 trillion. Reducing this to 4° adds a further $10 trillion, but going down to 3°C would cost $40 trillion, and to 2°, $100 trillion. The world is not yet ready for a largescale cost-effective mitigation program, and the more aggressive targets do not allow for such delays.

    In practice, a large fraction of the potential damage from climate change can be avoided by adaptation. Indeed, this is hard to prevent because all sections of society have an incentive to do so.

  • Foreword: Why Measurement of Costs and Benefits Matters for the SDG Campaign

    • By Stefan Dercon, former Chief Economist, Department for International Development (DFID), UK; Professor of Economic Policy, Oxford University, UK, Stephen A. O'connell, former Chief Economist, United States Agency for International Development (USAID); Gil and Frank Mustin Professor of Economics, Swarthmore College, Pennsylvania, USA
  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp xxiv-xxx

  • Summary

    The Sustainable Development Goals (SDGs) provide an extraordinary vision of what global development should look like between now and 2030. Starting with the concept of sustainability, the SDGs go far beyond the Millennium Development Goals (MDGs) to incorporate a set of environmental and social-justice priorities that require national action at all levels of income. As agreed by 193 signatory nations at the September 2015 United Nations General Assembly, the 2030 Agenda for Sustainable Development (https://sustainabledevelopment.un.org/post2015/ transformingourworld) is meant to be universal, indivisible, and interlinked. In conventional development arenas like extreme poverty and hunger the SDGs also inspire, doubling down on the MDGs by defining success in absolute rather than relative terms. Global partners target an end to poverty in all its forms, for example, rather than a 50 percent reduction in extreme-poverty headcount ratios.

    The UN's drive for universal norms and targets involved widespread public debate and painstaking negotiations and compromises between national governments. The process was simultaneously more transparent and much more difficult and convoluted than when the MDGs emerged from behind closed doors a decade and a half ago. Some widening in the scope of commitments was inevitable and also desirable, to accommodate sustainability goals and build a truly global coalition. But there was also widespread awareness as negotiations proceeded that fewer goals might allow for greater success. By the latter standard, the 2030 Agenda is daunting. With 17 global goals and 169 highly ambitious targets, the Agenda seems in danger of departing not just in scope but also in coherence from the elegant eight goals and 17 targets of the MDGs.

    In practice, therefore, a great deal remains on the table in terms of shaping global action. This is true not just in the conventional sense of identifying costeffective approaches to individual targets but also in the deeper sense of operationalizing – and unavoidably, prioritizing – targets at the national and global levels. This book makes a vital contribution to what should be a collective effort to prioritize.

  • 9 - Benefits and Costs of the Trade Targets for the Post-2015 Development Agenda

    • By Kym Anderson, George Gollin Professor of Economics, School of Economics, University of Adelaide, and Professor of Economics, Arndt- Corden Department of Economics, Australian National University, Canberra, Australia
  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 192-215

  • Summary

    Opportunities to Lower Trade Barriers

    Lowering trade barriers would contribute to all four of the likely main goals of the United Nations’ post-2015 development agenda: poverty alleviation, ending hunger, reducing income inequalities, and strengthening global partnerships for sustainable development (United Nations, 2014).

    Stronger global partnerships for sustainable development would result from promoting a more open, rules-based, nondiscriminatory and equitable multilateral trading system by successfully completing the Doha Development Agenda (DDA) negotiations at the World Trade Organization (WTO). Remaining barriers to trade harm most the economies imposing them, but the worst of the merchandise barriers (in agriculture and textiles) are particularly harmful to the world's poorest producers. Reforming those policies would thus alleviate poverty, reduce income inequality within and between nations, reduce malnutrition and hunger globally, and boost employment and economic growth sustainably, particularly in rural areas of developing countries, where three-quarters of the world's poor reside (World Bank, 2007).

    It is within the power of national governments to lower their own barriers to trade unilaterally, of course, but often that is difficult to achieve politically. Lowering them is politically easier when other countries do so at the same time, as with a multilateral or regional trade and integration agreement. For developing countries that is especially so if that agreement includes an aid-fortrade package.

    Among the possible strategies to reduce remaining price- and trade-distorting measures, five current opportunities stand out. The most beneficial involves multilaterally completing the stalled Doha Development Agenda (DDA) of the World Trade Organization (WTO). If that continues to prove to be too difficult politically to bring to a conclusion in the near future, three other opportunities considered here are the proposed Trans-Pacific Partnership (TPP), extending the free-trade area among the ten-member Association of South East Asian Nations to include China, Japan, and South Korea (ASEAN+3), and freeing up trade among all APEC countries (a free trade area of the Asia-Pacific, FTAAP). One more potential opportunity involves bringing disciplines to export restrictions to match those for import restrictions, especially for farm products.

  • Chapter 4 - Beyond Civil War

  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 67-90

  • Summary

    Violence is part of the human condition and zero targets such as "Prevent and eliminate all forms of violence against girls and women" are aspirational. Some countries are more able to "ensure stable and peaceful societies" than others; how the reduction of violence can be achieved is less well understood. Despite the uncertainty of what feasible targets for violence reduction are and how they can be achieved we advocate the inclusion of such targets in the post-2015 agenda. Our estimates suggest that the costs of violence are high; the welfare cost of collective, interpersonal violence, harsh child discipline, intimate partner violence and sexual abuse are equivalent to around 11% of global GDP. The cost of homicides is much larger than the cost of civil conflict. However, violence perpetrated in the home appears to be the most prevalent form of violence. Domestic abuse of women and children should no longer be regarded as a private matter but a public health concern.

  • 24 - Benefits and Costs of the Poverty Targets for the Post-2015 Development Agenda

    • By John Gibson, Professor of Economics, University of Waikato, Hamilton, New Zealand
  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 446-472

  • Summary

    Introduction

    The first Sustainable Development Goal (SDG) is to “end poverty in all its forms everywhere,” and the first target under this goal is that by 2030 the world should have eradicated extreme poverty for all people everywhere, currently measured as people living on less than $1.25 a day. In contrast to the Millennium Development Goals (MDGs), this adoption of zero targets is a common theme within the SDGs (for example, the zero hunger target). However, such targets are both highly unlikely to be met and an inefficient use of global resources.

    In this chapter I discuss two sets of reasons why there is unlikely to be zero poverty, or zero hunger, by 2030. The first reasons relate to measurement problems with zero targets; despite being attractive rallying cries for activists, they create difficulty for the statistical measurement of human progress. The targets relate to the lower tail of distributions so statistics on living standards have to reliably measure not just means and totals but also variances. The main source of empirical data for monitoring progress is household surveys, which developed primarily to provide mean weights for consumer price indexes and later to aid in calculation of national accounts. Common designs used for those tasks overstate variances and mix together chronic and transient welfare components. Consequently, it will be difficult to detect the achievement of zero poverty or zero hunger with the existing approach to surveys. Moreover, as countries escape from mass poverty, the remaining poverty becomes more sensitive to inequality, and the design of household surveys is increasingly ill-suited to measuring inequality in a more affluent and more urban world.

    The second set of reasons relates to qualitative differences between past and future problems. The role of one-off institutional reforms in East Asia whose effects are unlikely to be replicated elsewhere; the characteristics of rice as an ideal food for the poor, which gives East Asia another advantage in poverty reduction makes poverty reduction elsewhere more challenging, and the fact that as countries escape from mass poverty the nature of poverty changes, with the poor becoming less like the majority in terms of location, ethnicity, caste, or religion. Each of these factors is likely to make poverty reduction going forward much harder than it was for the two decades from 1990.

  • 21.2 - alternative perspective

    • By Gregory Casey, Doctoral Candidate, Brown University, Rhode Island, USA, Oded Galor, Herbert H. Goldberger Professor of Economics, Core Faculty, Population and Training Center, Brown University, Rhode Island, USA and Fellow, Department of Economics, Hebrew University, Israel
  • Edited by Bjorn Lomborg, Copenhagen Business School
  • Book:
    Prioritizing Development
    Published online:
    30 May 2018
    Print publication:
    07 June 2018, pp 397-398

  • Summary

    Summary

    In all facets of life, people must make decisions about how to allocate scarce resources. Potential parents must decide how many children to have and how much to invest in the future of each child. This decision is known as the “quantity-quality” trade-off. At the most fundamental level, when individuals invest more in the human capital of each child and have fewer children, they raise the future per capita earnings power of the next generation. Developing countries have high rates of fertility, which place a great burden on governments and aid agencies hoping to alleviate poverty and deprivation. In these settings, policies inducing parents to have fewer children and invest more in the education of each child will have positive effects beyond those captured by short-term costbenefit analysis.

    Rich countries face the opposite problem, of falling fertility and rising numbers of older dependents. Countries can make up the shortfall in public revenue by encouraging high skill immigration, which has positive effects also on sending countries by raising the return to human capital accumulation.

    For much of human history, differences in per capita income across the globe were negligible because increases in productivity were used to support larger populations. This negative feedback loop between productivity and population, as described by Malthus, began to unravel at the turn of the nineteenth century in parts of Western Europe. Fertility began to lag behind increases in productivity, leading to higher living standards. Eventually, fertility rates began to fall as incomes continued to rise. This process led to a rapid increase in the living standards of Western Europe and its offshoots as well as a corresponding rise in the degree of global inequality. Understanding this demographic transition is essential for devising policies to help spur economic and demographic change in developing countries.

    Having fewer children but investing more in their education produces a more educated workforce, drives up living standards, and increases technological progress. Meanwhile, increased technological progress raises the return to human capital investment, inducing parents to substitute toward child quality. This relationship between fertility and economic growth is the basis of Unified Growth Theory. The rising importance of human capital also lowers the return to child labor and increases the earning power of women, reinforcing this pattern. Understanding these links, therefore, provides important insights into the most effective ways to influence fertility and growth through public policies.

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