Regulatory Structure for Financial Stability and Development

To understand the appropriate regulatory response to the crisis, we start from the basic market failures that justify regulation in financial markets. Neglecting these first principles contributed to the market and regulatory failures. Regulation that induces better outcomes through creating correct incentives for market participants is the key to reform. A combination of micro and macro prudential regulation can moderate procyclicality, information failure and market power. Better national and global coordination of regulators is also required. Global prudential standards can push financial firms to choose safe over risky strategies, by removing the moral hazard from bailouts, and assuring that a competitor is not adopting risky strategies either. Universal application of basic standards prevents regulatory arbitrage. A pure principles-based regulatory approach maybe too flexible, but principle-based rules retain sufficient operational flexibility and universality. This analysis is applied to regulation in emerging market economies (EMEs), where development of financial markets is a major regulatory goal along with stability.market failures, incentives, procyclicality, coordination, rules versus principles, development

Natural disasters : what is the role for social safety nets?

This paper makes the case for why safety nets are an important tool for managing the risk of natural hazards. The use of safety nets is advocated both ex ante, to prevent and mitigate the impact of natural disaster and ex post, to cope with the impacts of natural shocks. Firstly, the paper explores the implications of contextual factors to be taken into account in the design of an effective safety net system to respond to the needs generated by natural disasters. Learning from the responses to a number of recent natural disasters, a typology of the different types of natural hazards which require different approaches to reduce their risk is introduced. Secondly, the paper considers some'guidelines'for improving the design and implementation of safety nets either to prevent and/or to recover from natural disasters. Finally, some conclusions and recommendations for more effective safety net and suggestions for addressing key issues are outlined.Safety Nets and Transfers,Hazard Risk Management,Food&Beverage Industry,Labor Policies,Natural Disasters

Costs and benefits of superfast broadband in the UK

This paper was commissioned from LSE Enterprise by Convergys Smart Revenue Solutions to stimulate an open and constructive debate among the main stakeholders about the balance between the costs, the revenues, and the societal benefits of ‘superfast’ broadband. The intent has been to analyse the available facts and to propose wider perspectives on economic and social interactions. The paper has two parts: one concentrates on superfast broadband deployment and the associated economic and social implications (for the UK and its service providers), and the other considers alternative social science approaches to these implications. Both parts consider the potential contribution of smart solutions to superfast broadband provision and use. Whereas Part I takes the “national perspective” and the “service provider perspective”, which deal with the implications of superfast broadband for the UK and for service providers, Part II views matters in other ways, particularly by looking at how to realise values beyond the market economy, such as those inherent in neighbourliness, trust and democrac

Remittance flows to post-conflict states: perspectives on human security and development

This repository item contains a single issue of the Pardee Center Task Force Reports, a publication series that began publishing in 2009 by the Boston University Frederick S. Pardee Center for the Study of the Longer-Range Future.Migrant remittances – that is, money or other goods sent to relatives in the country of origin– play an increasingly central role in post-conflict reconstruction and national development of conflict-affected states. Private remittances are of central importance for restoring stability and enhancing human security in post-conflict countries. Yet the dynamics of conflict-induced remittance flows and the possibilities of leveraging remittances for post-conflict development have been sparsely researched to date. This Pardee Center Task Force Report is the outcome of an interdisciplinary research project organized by the Boston University Center for Finance, Law & Policy, in collaboration with The Frederick S. Pardee Center for the Study of the Longer-Range Future. The Task Force was convened by Boston University development economist John R. Harris and international banking expert Donald F. Terry, and social anthropologist Daivi Rodima-Taylor, Visiting Researcher at the Boston University African Studies Center, served as lead researcher and editor for the report. The Task Force was asked to research, analyze, and propose policy recommendations regarding the role of remittances in post-conflict environments and their potential to serve as a major source of development funds. The report’s authors collectively suggest a broader approach to remittance institutions that provides flexibility to adapt to specific local practices and to make broader institutional connections in an era of growing population displacement and expanding human and capital flows. Conditions for more productive use of migrants’ remittances are analyzed while drawing upon case studies from post-conflict countries in Africa, Asia and Latin America. The papers in this Task Force Report establish the importance of remittances for sustaining local livelihoods as well as rehabilitating institutional infrastructures and improving financial inclusion in post-conflict environments. Highlighting the increasing complexity of global remittance systems, the report examines the growing informality of conflict-induced remittance flows and explores solutions for more efficient linkages between financial institutions of different scales and degrees of formality. It discusses challenges to regulating international remittance transfers in the context of growing concerns about transparency, and documents the increasing role of diaspora networks and migrant associations in post-conflict co-development initiatives. The Task Force Report authors outline the main challenges to leveraging remittances for post-conflict development and make recommendations for further research and policy applications

Valuing adaptation under rapid change

AbstractThe methods used to plan adaptation to climate change have been heavily influenced by scientific narratives of gradual change and economic narratives of marginal adjustments to that change. An investigation of the theoretical aspects of how the climate changes suggests that scientific narratives of climate change are socially constructed, biasing scientific narratives to descriptions of gradual as opposed rapid, non-linear change. Evidence of widespread step changes in recent climate records and in model projections of future climate is being overlooked because of this. Step-wise climate change has the potential to produce rapid increases in extreme events that can cross institutional, geographical and sectoral domains.Likewise, orthodox economics is not well suited to the deep uncertainty faced under climate change, requiring a multi-faceted approach to adaptation. The presence of tangible and intangible values range across five adaptation clusters: goods; services; capital assets and infrastructure; social assets and infrastructure; and natural assets and infrastructure. Standard economic methods have difficulty in giving adequate weight to the different types of values across these clusters. They also do not account well for the inter-connectedness of impacts and subsequent responses between agents in the economy. As a result, many highly-valued aspects of human and environmental capital are being overlooked.Recent extreme events are already pressuring areas of public policy, and national strategies for emergency response and disaster risk reduction are being developed as a consequence. However, the potential for an escalation of total damage costs due to rapid change requires a coordinated approach at the institutional level, involving all levels of government, the private sector and civil society.One of the largest risks of maladaptation is the potential for un-owned risks, as risks propagate across domains and responsibility for their management is poorly allocated between public and private interests, and between the roles of the individual and civil society. Economic strategies developed by the disaster community for disaster response and risk reduction provide a base to work from, but many gaps remain.We have developed a framework for valuing adaptation that has the following aspects: the valuation of impacts thus estimating values at risk, the evaluation of different adaptation options and strategies based on cost, and the valuation of benefits expressed as a combination of the benefits of avoided damages and a range of institutional values such as equity, justice, sustainability and profit.The choice of economic methods and tools used to assess adaptation depends largely on the ability to constrain uncertainty around problems (predictive uncertainty) and solutions (outcome uncertainty). Orthodox methods can be used where both are constrained, portfolio methodologies where problems are constrained and robust methodologies where solutions are constrained. Where both are unconstrained, process-based methods utilising innovation methods and adaptive management are most suitable. All methods should involve stakeholders where possible.Innovative processes methods that enable transformation will be required in some circumstances, to allow institutions, sectors and communities to prepare for anticipated major change.Please cite this report as: Jones, RN, Young, CK, Handmer, J, Keating, A, Mekala, GD, Sheehan, P 2013 Valuing adaptation under rapid change, National Climate Change Adaptation Research Facility, Gold Coast, pp. 192.The methods used to plan adaptation to climate change have been heavily influenced by scientific narratives of gradual change and economic narratives of marginal adjustments to that change. An investigation of the theoretical aspects of how the climate changes suggests that scientific narratives of climate change are socially constructed, biasing scientific narratives to descriptions of gradual as opposed rapid, non-linear change. Evidence of widespread step changes in recent climate records and in model projections of future climate is being overlooked because of this. Step-wise climate change has the potential to produce rapid increases in extreme events that can cross institutional, geographical and sectoral domains.Likewise, orthodox economics is not well suited to the deep uncertainty faced under climate change, requiring a multi-faceted approach to adaptation. The presence of tangible and intangible values range across five adaptation clusters: goods; services; capital assets and infrastructure; social assets and infrastructure; and natural assets and infrastructure. Standard economic methods have difficulty in giving adequate weight to the different types of values across these clusters. They also do not account well for the inter-connectedness of impacts and subsequent responses between agents in the economy. As a result, many highly-valued aspects of human and environmental capital are being overlooked.Recent extreme events are already pressuring areas of public policy, and national strategies for emergency response and disaster risk reduction are being developed as a consequence. However, the potential for an escalation of total damage costs due to rapid change requires a coordinated approach at the institutional level, involving all levels of government, the private sector and civil society.One of the largest risks of maladaptation is the potential for un-owned risks, as risks propagate across domains and responsibility for their management is poorly allocated between public and private interests, and between the roles of the individual and civil society. Economic strategies developed by the disaster community for disaster response and risk reduction provide a base to work from, but many gaps remain.We have developed a framework for valuing adaptation that has the following aspects: the valuation of impacts thus estimating values at risk, the evaluation of different adaptation options and strategies based on cost, and the valuation of benefits expressed as a combination of the benefits of avoided damages and a range of institutional values such as equity, justice, sustainability and profit.The choice of economic methods and tools used to assess adaptation depends largely on the ability to constrain uncertainty around problems (predictive uncertainty) and solutions (outcome uncertainty). Orthodox methods can be used where both are constrained, portfolio methodologies where problems are constrained and robust methodologies where solutions are constrained. Where both are unconstrained, process-based methods utilising innovation methods and adaptive management are most suitable. All methods should involve stakeholders where possible.Innovative processes methods that enable transformation will be required in some circumstances, to allow institutions, sectors and communities to prepare for anticipated major change

Living with Uncertainty

The last few years have seen a major rethinking of some of the hallowed assumptions of range ecology and range management practice. This book examines the management of policy implications of this new ecological thinking for pastoral development in dryland areas. With examples drawn from all over Africa, the contributors examine the consequences of living with uncertainty for pastoral development planning, range and fodder management, drought responses, livestock marketing, resource tenure, institutional development and pastoral administration

Facility Location Planning in Relief Logistics: Decision Support for German Authorities

Disasters have devastating impacts on societies, affecting millions of people and businesses each year. The delivery of essential goods to beneficiaries in the aftermath of a disaster is one of the main objectives of relief logistics. In this context, selecting suitable locations for three different types of essential facilities is central: warehouses, distribution centers, and points of distribution. The present dissertation aims to improve relief logistics by advancing the location selection process and its core components. Five studies published as companion articles address substantial aspects of relief logistics. Despite the case studies\u27 geographical focus on Germany, valuable insights for relief logistics are derived that could also be applied to other countries. Study A addresses the importance of public-private collaboration in disasters and highlights the significance of considering differences in resources, capabilities, and strategies when using logistical models. Moreover, power differences, information sharing, and partner selection also play an important role. Study B elaborates on the challenges to identify candidate locations for warehouses, which are jointly used by public and private actors, and suggests a methodology to approach the collaborative warehouse selection process. Study C investigates the distribution center selection process and highlights that including decision-makers\u27 preferences in the objective function of location selection models helps to raise awareness of the implications of location decisions and increases transparency for decision-makers and the general population. Study D analyzes the urban water supply in disasters using a combination of emergency wells and mobile water treatment systems. Selected locations of mobile systems change significantly if vulnerable parts of the population are prioritized. Study E highlights the importance of accurate information in disasters and introduces a framework that allows determining the value of accurate information and the planning error due to inaccurate information. In addition to the detailed results of the case studies, four general recommendations for authorities are derived: First, it is essential to collect information before the start of the disaster. Second, training exercises or role-playing simulations with companies will help to ensure that planned collaboration processes can be implemented in practice. Third, targeted adjustments to the German disaster management system can strengthen the country\u27s resilience. Fourth, initiating public debates on strategies to prioritize parts of the population might increase the acceptance of the related decision and the stockpiling of goods for the people who know in advance that they will likely not receive support. The present dissertation provides valuable insights into disaster relief. Therefore, it offers the potential to significantly improve the distribution of goods in the aftermath of future disasters and increase disaster resilience