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Development economics, globalism and inequality, the aid system, international financial institutions, education, Latin America, climate financing
Nancy Birdsall is president emeritus and a senior fellow at the Center for Global Development, a policy-oriented research institution that opened its doors in Washington, DC in October 2001. Prior to launching the center, Birdsall served for three years as senior associate and director of the Economic Reform Project at the Carnegie Endowment for International Peace. Her work at Carnegie focused on issues of globalization and inequality, as well as on the reform of the international financial institutions.
From 1993 to 1998, Birdsall was executive vice-president of the Inter-American Development Bank, the largest of the regional development banks, where she oversaw a $30 billion public and private loan portfolio. Before joining the Inter-American Development Bank, she spent 14 years in research, policy, and management positions at the World Bank, most recently as director of the Policy Research Department.
Birdsall has been researching and writing on economic development issues for more than 25 years. Her most recent work focuses on the relationship between income distribution and economic growth and the role of regional public goods in development.
Birdsall is a member of the Board of Directors of the International Food Policy Research Council (IFPRI), of the African Population and Health Research Center, and of Mathematica. She has chaired the board of the International Center for Research on Women and has served on the boards of the Social Science Research Council, Overseas Development Council, and Accion. She has also served on committees and working groups of the National Academy of Sciences.
Birdsall holds a PhD in economics from Yale University and an MA in international relations from the Johns Hopkins School of Advanced International Studies.
Putting Education to Work in Egypt, by Nancy Birdsall and Lesley O'Connell. Prepared for Conference, Growth Beyond Stabilization: Prospects for Egypt, sponsored by The Egyptian Center for Economic Studies in collaboration with the Center for Institutional Reform and the Informal Sector, University of Maryland; the Harvard Institute for International Development, and the US Agency for International Development, February 3-4, 1999, Cairo, Egypt. March 1999.
"Intergenerational Mobility in Latin America: Deeper Markets and Better Schools Make a Difference," with Jere R. Behrman and Miguel Szekely, in New Markets, New Opportunities? Economic and Social Mobility in a Changing World (1999)
"The U.S. and the Social Challenge in Latin America: The New Agenda Needs New Instruments," with Nora Lustig and Lesley O'Connell, in The Search for Common Ground: U.S. National Interests and the Western Hemisphere in a New Century (W.W. Norton & Company, Inc., 1999)
"Deep Integration and Trade Agreements: Good for Developing Countries?" with Robert Z. Lawrence in Global Public Goods: International Cooperation in the 21st Century (Oxford University Press, 1999)
"No Tradeoff: Efficient Growth Via More Equal Human Capital Accumulation in Latin America," in Beyond Trade-Offs: Market Reforms and Equitable Growth in Latin America (1998)
"That Silly Inequality Debate," in Foreign Policy, May/June 2002
"Education in Latin America: Demand and Distribution are Factors that Matter," with Juan Luis Londoño and Lesley O'Connell in CEPAL Review 66, December 1998
"Life is Unfair: Inequality in the World," in Foreign Policy, Summer 1998
"Public Spending on Higher Education in Developing Countries: Too Much or Too Little?" in Economics of Education Review, 1996
Evidence shows that when women have the opportunity to serve as political leaders, governments are not only more inclusive but also perform better. Women politicians are shown to champion policies improving health services and education systems, and they serve as positive role models influencing girls’ career aspirations and educational attainment. But across the world, women’s rates of political leadership remain lower than men’s. What are the obstacles standing in the way of women’s equal political participation? And what can be done to overcome these obstacles?
The Millennium Challenge Corporation (MCC) was established to provide large-scale grant funding to poor, well-governed countries to support their efforts to reduce poverty and generate economic growth. However, the statutory definition of which countries are “poor” for the purposes of MCC candidacy is inadequate. Based solely on GNI per capita with a rigid graduation threshold, it does not portray a clear picture of broad-based well-being in a country. Using a new, comprehensive country-level dataset of median consumption/income, the authors explore the merits and limitations of such a measure and suggest how it might be applied as an additional determinant of MCC candidacy.
Does broadening financial access to large segments of the population pose risks to financial stability? Not necessarily, according to recent remarks by IMF managing director Christine Lagarde. Increasing access to basic financial transactions such as payments does not threaten financial stability, especially when appropriate supervisory and regulatory frameworks are in place. In fact, with the right regulatory supervision, increased access to financial services can result in both micro and macro benefits. Recognizing the macroeconomic and regulatory dimensions of financial inclusion, CGD and the IMF joined forces for a seminar to kick off the IMF Spring Meetings 2016.
In a recent blog, Duncan Green wonders if “Pay by Results” (PbR) programs are overhyped and questions whether foreign aid agencies and NGOs should be pursuing them at all. Only a few countries have stepped into this new way of doing aid. PbR may be overhyped at the same time that at least one type of PbR is underutilized.
Join us for a special event marking CGD’s 15th anniversary and EBRD’s 25th. EBRD president Sir Suma Chakrabarti will give a major policy speech on the future of multilateral development banking in a changing world, and then discuss the challenges and opportunities for MDBS with CGD president Nancy Birdsall. Directly afterwards, you are also invited to a reception from 5:15 - 7:00 p.m., hosted by EBRD to celebrate the opening of its new office in Washington DC.
On February 23, CGD President Nancy Birdsall will deliver the first Kapuscinski Development Lecture of 2016 in Berlin, Germany. Her lecture, “The New Middle Class in the Developing World: Does It Matter?” will take a hard look at what it means to be middle class in developing countries and explore the role of strugglers, the rapidly expanding group of people caught between extreme poverty and the middle class.
In 2009, Guyana created a Low Carbon Development Strategy to develop economically while keeping its entire forest intact, and signed a Memorandum of Understanding with Norway to receive performance-based payments in the tens of millions of dollars annually contingent upon holding nationwide deforestation to a near-zero rate. In mid-February, 2014, we visited Guyana as part of a three-country study to attempt to gain insights of value to the future expansion of performance-based payments in other countries and other sectors.
Integration of the global economy has outpaced the ability of international institutions to address key market failures—inequality, volatility, and inadequate provision of global public goods—undermining the prospects for inclusive and sustainable growth, CGD president Nancy Birdsall said in an address to the UN General Assembly.
In the absence of an activist global political entity to address these issues, as national governments attempt to do within sovereign states, the growing number of people who are coming to regard themselves as global citizens should press their own governments to adopt policies that address these problems, domestically and internationally, she said.
Put the UN General Assembly on The Daily Show! Or Maybe Not? (Blog)
Global Citizens and the Global Economy (Speech)
“I am a US citizen by birth and a development economist by training. But with the globalization of everything—supply chains, Facebook, civil society, and more—I have felt more and more like a citizen of the world. I suspect that many of you feel much the same way,” Birdsall said.
The September 10 address was the focus of this year’s UN General Assembly session on the Millennium Development Goals, the UN-endorsed poverty-reduction targets that expire in 2015.
Birdsall made clear that market-driven growth has put the world on the winning side in the global war on poverty, creating opportunities for hundreds of millions of people to lift themselves out of poverty, and supporting rapid progress in many countries on the MDGs.
But, she added, “economic globalization has outpaced political globalization. We have a global economy without the equivalent at the global level of a state.”
For example, she said, unmanaged markets tend to exacerbate inequality, within and across nations, as those with the right assets—such as access to quality education—enjoy high and rising incomes while those who lack such assets fall further behind. Similarly, the gap between the richest and poorest nations has widened with globalization, she said.
Volatility, especially in global financial markets, can exacerbate inequality, she said. “In 2007 and 2008, we saw how the tightening of fuel and food markets led to price spikes that were particularly painful for importing countries that had relied on global trade of these products—and for poor households in those countries. Then at the end of 2008 came the collapse of financial markets around the world—with real effects on growth, jobs, and well-being everywhere, though thankfully not long-lasting in many developing countries.”
Even so, "the high public debt that follows government rescues of banks and other financial institutions crowds out private investment and job creation and reduces the fiscal space for spending on infrastructure, education, and health programs that benefit the poor and help build a middle class." Such crises also strip assets from the poor, sometimes with lifelong consequences, she said. For example, children pulled from school because of a family's financial hardship often do not return, even when markets have recovered.
The third problem with unmanaged markets, she said, is the inadequate provision of public goods, a problem that is most urgent and obvious at the global level in the lack of agreement to limit a global public bad, emissions of carbon and other heat-trapping gasses that are driving climate change.
“Just as local pollution control requires that a government entity imposes regulations or creates offsetting incentives through taxes or subsidies, global‐level control of greenhouse gas emissions is likely to require that an activist international community, including at the least the major polluter countries, impose controls or agree on incentives,” Birdsall said.
“Climate change is the biggest and most glaring example of a global problem that hits the poor people and countries hardest. By an unfortunate twist of fate, tropical countries that contributed least to the accumulation of gases are likely to suffer the worst declines in agricultural productivity, in precisely the sector where the poor within countries are heavily concentrated.”
“In the absence of corrective action at the global level, projected declines in agriculture in India are on the order of 30 percent in the next 70 years—and as much or worse in parts of Africa. Sea-level rise in Bangladesh, drought and floods, and the expanding reach of malaria and other diseases in many tropical areas will also hit those most vulnerable hardest.”
What to do? The first-best solution would in principle be an activist global polity, she said, one with the mandate from global citizens to set and enforce policies and practices that would reduce global inequality, deal with volatility, and ensure adequate provision of such global public goods as zero-carbon-emissions energy.
“But in fact the world is made up of sovereign nations—and it is within sovereign nations that democratic and representative systems of government are rooted. It is within nations that citizens of the world ... have the possibility and the responsibility to hold the governments of their own countries accountable for policies and practices that have impacts within and beyond their borders.”
She concluded her speech with a list of suggestions—many grounded in CGD research—for policies and practices that those who consider themselves global citizens should urge their governments to adopt.
Among these: for the United States to put a price on carbon emissions, and for the Europe and the United States to endorse governance reforms in the IMF and World Bank that would give the big emerging-market nations a larger stake—and thus to help these institutions become more effective in responding to global challenges (financial market volatility in the case of the IMF and inadequate provision of global public goods in the case of the World Bank).
She also offered suggestions for the rich and powerful individuals in the big emerging-market countries such as China, India, Brazil, and Indonesia, including protection of their own forests and investments in infrastructure, health, and education to enable people who remain poor in those countries to lift themselves out of poverty.
“All of us in this room are among the world’s rich, influential, and powerful. We are each responsible for holding our own countries accountable—for domestic policies that at the least do no harm elsewhere, and for our own countries’ support of multilateralism and international cooperation on global economic and financial challenges,” she said. “I do believe that more citizens of the world, particularly young citizens, are getting on board. Let us all join them.”
Nancy Birdsall argues that the concept of inclusive growth should go beyond the traditional emphasis on the poor (and the rest) and take into account changes in the size and economic command of the group conventionally defined as neither poor nor rich, that is, the middle class.
Many obstacles to development transcend national borders and therefore cannot be adequately addressed within a single country. These include issues such as drug resistance and other cross-border health risks, financial crises contagion, money laundering, water scarcity, fisheries collapse and, of course, climate change. Economists call efforts to address these problems Global Public Goods (GPGs). Like other public goods, funding for GPGs is chronically in short supply: of $125 billion in annual official development assistance (ODA ) only about $3 billion goes to GPGs.
In our first podcast of the new year and my first podcast as new host, I speak with CGD's president Nancy Birdsall on her expectations for 2015 as they relate to global development. We cover growing inequality, the marquee moments for development in 2015, and Nancy makes the case for optimism on the post-2015 development agenda. Have a listen.
In this paper, Nancy Birdsall sets out basic information on the growing middle class in Latin America and the Caribbean and provides grounds for optimism that such expansion might reinforce the inclusive politics that sustain broadly shared growth.
The last decade has seen considerable progress enrolling children in schools worldwide: today most people live in countries on track to meet the Millennium Development Goal of 100% primary completion by 2015.
Sadly, enrollment doesn’t necessarily equal learning. A new report by the CGD Study Group on Measuring Learning Outcomes shows a shockingly wide gap between education inputs and learning outcomes – many children finish primary school unable to read, write or do simple addition. The report, Schooling is Not Education: Using Assessment to Change the Politics of Non-Learning, finds the learning crisis reflects systemic issues in education sectors worldwide. It recommends strong assessment regimes as part of the solution.
On May 9, CGD president Nancy Birdsall will chair a conversation on the report with Alice Albright, chair of the Global Partnership for Education; CGD Study Group co-chair Lant Pritchett; Project director Charles Kenny; and other members of the Study Group. They will discuss the findings and implications for education in the post-2015 development agenda.
CGD is especially concerned with the policies and practices of rich countries, corporations, and individual citizens that affect the world’s less fortunate people, especially the 5 billion least fortunate people who live in developing countries. In 2013 life for most people in those countries continued to get better as it has for several decades. In the advanced economies, the largely self-imposed austerity following the financial crisis of 2008-09 may finally be lifting.