Policy Research at the World Bank Jean-Jacques Dethier, Research Manager, Development Economics The World Bank National Science Foundation International Workshop in STEM Graduate Education to Develop a Research Agenda, Holiday Inn, Arlington VA, February 6-7, 2011
The World Bank’s Comparative Advantage Given its experience in all developing countries (and access to governments), the World Bank produces * knowledge in many areas of development policy such as macroeconomic policy; health; education; social policy; poverty alleviation; infrastructure; environment; etc * high quality, rigorous empirical research * development data * surveys and analytical tools The Bank also acts as a catalyst for new ideas, advocates certain ideas on development and influence development debates because of the quality, diversity and relevance of its knowledge. 2
Changing Landscape for Knowledge • In fiscal year 2010 the World Bank Group (IBRD, IDA, IFC and MIGA) had lending commitments of $72 billion, and in 2009, 59 billion. • But decline in lending, especially in emerging economies like Brazil, Southern cone of Latin Am, Eastern Europe and South East Asia • Increasingly our clients ask for (and sometimes pay for) knowledge or what World Bank staff call “non - lending services”. • The changing nature of the market for development knowledge poses a challenge if the World Bank wants to maintain its technical and competitive edge • Competitors: private sector (McKinsey); public sector (OECD); NGOs (Oxfam); donors (Gates Foundation) and academia • General knowledge on global issues can be covered cheaply and faster – i.e. internet, Google, etc 3
MAKE winners and the World Bank — Are we loosing our technical edge…..? • World Bank (6 times winner) Other Winners (frequency) • 2000, ranked 10 th – first • Accenture (13) • Apple (5) public sector organization to • Ernst & Young (13) • Fluor (5) win the award • General Electric (11) • Google (6) • 2001, ranked 4 th • HP (10) • IBM (12) • 2002 -8 th • Infosys Technologies (7) • McKinsey & Co. (10) • • 2003, 9 th Microsoft (13) • MindTree (1) • PcW (9) • 2004, 19 th • Royal Dutch Shell (9); Samsung (7) • Schlumberger (4) • 2005, 42 nd • Siemens (9) • Tata Group (4) • Not on the list since… • Telefonica (1) • Wipro Technologies (4) MAKE stands for Most Admired Knowledge Enterprise 2010 data 4
The World Bank spent US$ 614 million on knowledge products in 2010 • not including knowledge embedded in (or generated through) our lending. • Knowledge for clients gets the largest share of spending: • 70% of spending on economic reports, sector analyses, impact evaluations, etc for client countries • 17% on internal knowledge products (conferences, etc) and • 13% on public goods (research, forecasts, global reports) • A greater share of core knowledge services goes to Africa (15%), followed by East Asia (12%), and Europe/Central Asia (9%) • Policy Research (public goods) • DEC produces the greatest share of public goods (85% in FY10) • 4 Networks produce internal knowledge products (environment & sustainable development; poverty reduction and economics; human development; finance & private sector development) 5
Spending on knowledge products increased between 2008 and 2010 • Spending on knowledge products increased 20% between 2008 and 2010 – Knowledge for clients increased 23% – Knowledge as public good increased 21% – Knowledge for internal use increased 8% • Regional spending on core knowledge products increased most for East Asia (27%), South Asia (25%) and Africa (23%) • Spending on knowledge by “networks” increased most - for Human Development (26%), - for Environment and Sustainable Development (24%) - for Economic Policy (24%) 6
What our clients want from us From client satisfaction surveys, we know that they want Dialogue on policy and institutional issues , based on informed experiences and best practices from across the world, led by seasoned professionals Just-in-time advice on policy reforms and their implementation ( how- to) customizing solutions to specific country / context Ready access to knowledge and sharing experiences on key topics under debate from across the globe Connections to policy reformers, development practitioners, and researchers with in-depth familiarity on the topic Operational advice by teams with continuous field presence on the implementation of agreed programs Economic or institutional analysis in various sectors Up-to-date cross-country data and policy briefings on global issues to inform their own policy debates 7
Leader in research on development • Ranked as the leading institution on development economics by SSRN (based on publications and citations) • Many individual researchers are stars in their field globally • Report on progress against poverty was most downloaded article in 2009 • Policy Research Working Papers viewed 80,000 times each month • Development data now available on Google • 24 million registered users for World Development Indicators Online, and 16 million for Global Development Finance Online • Our forecasts have readership of more than 700,000. 8
External Evaluation of World Bank Research 1998-2005 Independent Evaluation by a Panel chaired by Angus Deaton, Chair (Princeton), Abhijit Banerjee (MIT) & Ken Rogoff (Harvard) Assisted by D. Acemoglu (MIT), F. Caselli (LSE), T. Besley (LSE), S. Edwards (UCLA), G. Hanson (UC San Diego), N. Pavcnik (Dartmouth), E. Duflo (MIT), M. Leibbrandt (U of Cape Town), N. Birdsall (CGD), J. Angrist (MIT), S. Galiani (San Andrés, Argentina), J. Morduch (NYU), M. Bertrand (Chicago), Justin Lin (Beijing U.), C. Udry (Yale), M. Fafchamps (Oxford), Ed Glaeser (Harvard), M. Kremer (Harvard), A. Foster (Brown U.), G. Heal (Columbia U.), P. Diamond (MIT), A. Schoar (MIT) and J. Svejnar (U. of Michigan). Evaluators read a random sample of 420 journal articles, reports, and books talked to senior managers inside the Bank, and to external policymakers and users of Bank research
Strengths of World Bank research a) World leader in a number of important areas. Bank is the leading intellectual institution in development b) First rate work includes : social service delivery, impact evaluation, measurement of development outcomes, debate on aid effectiveness, on globalization , … c) Data generation, from the Living Standard Measurement Surveys, to the Doing Business and Investment Climate surveys, to the International Price Comparison Project Bank’s data provision is key to almost all academic and policy debate on development (the ‘knowledge Bank’)
Issues with World Bank research a) Data collection and dissemination needs to be more systematic b) The borderline between advocacy and research needs to be more carefully respected • Examples: work on Pension reform, aid effectiveness c) Inherent tension between policy relevance and academic distinction • Too much undistinguished "academic style" work • Better monitoring of ongoing research, more external advice, more external evaluation
World Bank is not an academic institution. Its research must ultimately be judged by its impact on development, including responding to new challenges The relevance test: does research lead to better policies? not every piece of research needs to pass the test of immediate policy relevance (strategic “blue sky” research) Recognizing context; diverse settings; "one size does not fits all" need to discuss policy implication based on country groups strengthen partnership with research institutions in developing countries since local economists know best what opportunities and constraints their country faces World Bank should also use its convening power to connect knowledge generated by different countries 12
Research Partnerships World Bank has a role as connector and disseminator of research produced in developing and developed countries The World Bank has a unique vantage point: with partners in government and civil society, it can - identify key gaps in knowledge, - generate awareness of emerging issues, - test new ideas and tools. Outside experts and centers of excellence are also key. Their role has increased the diversity of sources or advice to which developing countries can turn. 13
Solid Basis for Continuing Collaboration Many collaborations with developing country researchers Global Development Network (GDN) African Economic Research Consortium (AERC), the New Economic School (NES) in Moscow, the Economic Research Forum (ERF) in Cairo Important institutional partnership with the Consultative Group on International Agricultural Research (CGIAR) Collaboration at level of specific projects (in 70+ countries) Bank researchers work with consultants from some 90 countries During 1998-2005, outside researchers who co-authored Bank research came from 66 developing and 25 developed countries Bank research supported by a number of development partners (major donors like DfID; Sweden, Canada, etc) — providing further opportunities for intellectual exchange 14
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