Showing posts from 2013

Convergence in the Ease of Doing Business

Suppose that one were to divide the countries included in the latest Doing Business report into two groups. Call the first group (made up of some 44 countries) the “worst quartile”—that is, the countries with the costliest and most complex procedures and the weakest institutions. Call the other group the “best three quartiles.” Then let’s ask ourselves: how many days did it take to establish a business in both groups in 2005? The answer is 113 days in the worst quartile and 29 days in the best three quartile countries, meaning that in 2005 there was a gap of 84 days between the two sets. Now, let’s repeat the exercise for 2013. The worst quartile is down to 49 days and the best three quartiles is down to 16; the gap between the two has narrowed to 33 days, which is still sizable but a lot less than 84. Repeat the same exercise for time to register property and time to export a container. For property registration, the gap in 2005 was 192 days and by 2013 it has narrowe

How can we reduce high income inequality?

There are many ways to think about income inequality. One can, for instance, look at it within the boundaries of a particular country and ask how is income distributed today among Brazil’s 198 million citizens? It is also possible to look at the average income per capita of all the countries in the world (or a region of the world) and ask: how unequal are income differences across countries at a particular moment in time? We can think of this as international inequality . One can also abstract from national boundaries and concepts of citizenship, view the world as one human family, and ask: how is income distributed among its 7 billion people? Call this global income inequality . Inequality: 1950-2011  Source: Branko Milanovic, 2013 One of the more interesting—and surprising—results that fall out of the data on international income inequality is that although Gini coefficients have risen steadily since 1950 (see the chart above, for a group of 130 countries accounting fo

Overcoming gender inequalities: why is it so important?

Across the world, gender inequalities are large and persistent. We have inequalities in basic human rights, in control over economic resources (land, finance, information, earnings and employment, to name a few) and, of course, in power in the public and private spheres. There other forms of inequality which are more difficult to measure, such as access to joint income and assets within the household and those associated with the widespread prevalence of various forms of violence against women. Amartya Sen is surely right in stating that reducing these gender inequalities would go a long way toward empowering women and enhancing her well-being.   We should take some encouragement from two noticeable trends over the past several decades. One is greater recognition that the subjugation of women has led to a whole range of social ills and dysfunctions. The other is that moving toward greater gender equality need not be seen as a zero-sum game, implying loss for men. Rather, gender

Fiscal Strains in the Years Ahead

The world’s population by 2030 is projected to be 8.1 billion, 2 billion more than in 2000. A full 95 percent of the increase over this 30 year period will take place in the developing world, nearly all of it concentrated in urban areas. There is a relentless process of urbanization under way all over the world which, for instance, has transformed China’s landscape and has contributed to that country’s rapid pace of economic growth. Whereas in 1980 less than 20 percent of China’s total population of close to 1 billion was living in urban areas, by 2000 this share had risen to 33 percent. The urban population during this period expanded from about 190 million to over 420 million, and is projected to reach 1 billion by 2030. Well before 2030 China will have several megacities, with the population of Shanghai likely to exceed 25 million. An extra 2 billion people will put pressures on energy demand, for transportation, heating, lighting and to sustain the pace of economic