International Economics: IB Economics

It may seem odd but the head of the IMF, Kristina Georgieva has invoked John Maynard Keynes in calling for inclusive, sustainable economic growth. In a speech at King's College, Cambridge, she's asserted that there's no reason to believe that there's a trade-off between economic growth and equality, and that, in fact, the next century might be characterised by the two being mutually-reinforcing. 

It seems as though the prospects for South Asia, are lower than expected, with growth expected to be 5.6% per year, but that represents a downwards revision, in the light of the ongoing cost of living crisis. 

The World Bank is looking for governments in the region to look beyond the short-term and introduce the sorts of supply-side measure that will generate long-term sustainable growth, by tackling underlying structural factors that impede growth, and supporting those groups excluded from the benefits of growth. 

Mohamed El-Erian with a typical downbeat assessment of the prospects for the global economy - arguing that the conflict in Ukraine has rather served to mask the deeper seated problems that are going to imperil future growth prospects. 

He argues that the changing nature of globalisation, an over-reliance upon government stimulus and a lack of investment in the sources of sustainable growth are going to continue to mean that growth is likely to be sluggish going forward. 

This World Bank clip looks at how the bank has contributed to Kenya's coronavirus recovery, and how it is still contributing, with a specific focus on fostering inclusive growth, developing increasingly resilient social safety nets and, hopefully, bolstering the country's developmental prospects. 

This is an interesting look at global agriculture: how can we over-produce food and yet have millions of people who are malnourished, as well as generate large amounts of both food waste and greenhouse gases.

The key it seems is asymmetric information and the transaction costs, both things that the World Bank are trying to overcome via the application of digital technologies. This gives an overview of how this is meant to work increasing efficiency, inclusivity and environmental sustainability.  

It seems that the Greek crisis is far from over, with Yanis Varoufakis suggesting that the first tentative signs of recovery are heavily concentrated among the well-to-do who've been able to buy state assets at knockdown prices and debt from financial institutions. 

As a result, recovery is likely to be far from inclusive and further widen income inequality in the beleaguered Mediterranean economy. 

The World Economic Forum has highlighted why the Nordic model seems to work for everyone, countering the view that these states are high tax, and stultify entrepreneurship.

It's a view that isn't the prevailing one - certainly in the UK and the US - but the recent election campaign suggested that there might be a groundswell of support for a more radical social agenda in the UK.

However, one omission: there's little mention of oil revenues or the renewable capacity of these states, something that sets them apart relative to many other economies. 

I'll leave this here - Merry Christmas.

In short, Mohamed El-Irian suggests that recent trade tensions have eased and that the prospects for growth are marginally better than a month ago. However, the black cloud around that silver lining is the fact that politicians have consistently struggled to make growth inclusive, something that they're going to need to do if they want to maintain social cohesion.

This World Bank clip captures how thinking on development has changed in the past few decades. The notion of farmer-led irrigation highlights how bottom-up development devolves decision-making to those nearest the source of the problem and can increase agricultural output, speed development and, at the same time, allow for the sustainable management of water resources. 

I'm putting this here because it has greatest relevance to the development economics that I teach. This isn't to deny that it isn't appropriate for any of the Micro/Macro/Economic Method boards,  but it might get more traction here and that's a good thing.

Institutions are key to providing sustainable, inclusive growth.

This simplistic clip looks at the trade-off between the need for social safety nets whilst simultaneously encouraging growth, achieving inclusive growth. It involves ensuring that tax rates are appropriate without being restrictive and balancing interventionist and market-based reforms. 

This World Bank clip looks at the importance of biodiversity to sustainable development - noting that it's often the most vulnerable that are most dependent upon ecosystems in order to survive.

It argues that we should be looking at incorporating nature into sustainable, inclusive economic growth. 

On International Women's Day, the International Finance Corporation are celebrating the role of women in developing economies, in this case their support for female-owned businesses such as this bathroom hardware business in Sri Lanka.

Increased entrepreneurship, and increased female participation in the labour market are important drivers of inclusive development.

The World Health Organisation looks at the implications of ill health, in the aftermath of the coronavirus pandemic. It highlights the fact that coronavirus has adversely affected the poorest, killing proportionately more of the world's poor, increasing poverty and gender-based inequality. 

As a result the WHO are looking to a fairer, healthier, and more inclusive future. 

Mohamaed El-Erian looks at the prospects for an economic recovery in the United States, but calls for sustainable, inclusive growth.He highlights the need for a successful vaccination programme, a rebound for employment data and for the effects of a stimulus package to fall short of triggering inflation. 

He's often edited by my good friend, Richard Eames - if Rich wants to add me to the roster of Project Syndicate, I'm happy to write almost exactly the same article about the UK!

The rise of an aspirant middle-class is a sure sign of economic development and this World Bank clip looks at how almost half of all Indonesians are now in that bracket. 

This implies that there's been some degree of inclusive growth and that developmental outcomes are improving. There's just so much economics in this clip - microeconomics, with considerations of changing patterns of demand, YED and so on; macroeconomics, in terms of the implications for development. 

What a clip!

This is a fantastic Guardian exploration of the impact of palm oil on the Liberian economy, and those that produce it. It highlights the 'promise' of higher incomes for Liberian farmers and the reality of the impact. 

In short, the ordinary farmer hasn't seen much in the way of benefit but the large agrobusinesses who have acquired land have done. There's lots to look at: property rights, sustainable growth, the inequalities of trade and so on. It's a microcosm of the practicalities of development for the world's poorest. 

This World Bank clip looks at the economic success at Thailand, but also notes that the gains from growth have been unevenly distributed. Thus, the World Bank is looking for future growth to come from investment in human capital, boosting growth, reducing inequality and enhancing developmental outcomes.

Joseph Stiglitz is quick to hail Costa Rica as a beacon of enlightenment, an economy committed to inclusive growth and appropriate concern for the environment and so on. So far, so Guardian.

However, whilst small states often represent good testbeds for new ideas, whether they are feasible in other economies is more debatable, and I'll reserve judgment for now. In lots of cases, we overlook context at our peril, and look beneath the superficial, short-term appeal of the data. If you read carefully, for example, you might note that "inequality" is "still a problem". 

And more on development: this time confirmation that civil wars have a deleterious effect on growth and development, with Colombia the beneficiary. It is hoped that this will foster inclusive growth.