Uncivil societies - a theory of sociopolitical change

In times of crises, it is always useful to revisit some of the paradigms that underlie collective thinking and action. For nearly 200 years, most social science has relied on the assumption that the emergence of strong and nurturing social capital through a vibrant civil society yields all kind of positive externalities to society. Following intuition and anecdotal observations from Alexis de Tocqueville, a large body of theoretical and empirical research has attempted to confirm that societies strive politically and economically when they are able to build strong non-state actors and community organizations. Many disciplines-mainly political science, economics, law, and international relations-have constructed influential analytical frameworks in support of that general proposition. This paper examines the philosophical foundations of conventional wisdom and observes that it often fails to take into account the dark side of some civil society groups, from the mafia to Al Qaeda. While acknowledging the potential contribution of civil society to the development process, the paper also cautions again the rush to circumvent the state, which sometimes sustains community-based initiatives in poor countries. It suggests the possibility of the production of negative social capital by non-state actors.Parliamentary Government,Civil Society,Social Inclusion&Institutions,Corporate Law,Government Diagnostic Capacity Building

Latvia's macroeconomic options in the medium term : fiscal and monetary challenges of European Union membership

Latvia's experience over the past decade shows that economic growth and real convergence can no longer be assumedto be exogenously driven processes determined by given technological improvements and relatively higher factor returns. Instead, it is an endogenously driven process led by many variables, including policy variables. European Union membership clearly brings enormous economic benefits to Latvia. However, it also brings important challenges on the macroeconomic front, especially prior to the adoption of the euro. Substantial progress has been made toward fiscal consolidation since the mid-1990s but several risks remain. Given the facts that domestic demand remains buoyant and that Latvia will have to accommodate the expenditure commitments associated with NATO and EU membership while simultaneously aiming to fulfill the medium-term goal of a balanced budget, a more prudent fiscal policy should be the main short-term policy objective. The authorities should therefore reassess their current medium-term budget framework and strengthen their fiscal rules so that off-budget spending is eliminated and controls over spending ministries and local government finances are reinforced. They should also rethink any further tax reductions until a clear strategy is designed for compensating for projected losses in government revenues. Monetary policy can contribute to sustainable growth and job creation in Latvia in the medium and long term by providing an environment for price stability. It will have to be complemented by further microeconomic reforms and prudent wage developments aligned with productivity growth.Environmental Economics&Policies,Economic Theory&Research,Fiscal&Monetary Policy,Payment Systems&Infrastructure,Labor Policies,Economic Theory&Research,Banks&Banking Reform,National Governance,Economic Stabilization,Environmental Economics&Policies

Post-macroeconomics -- reflections on the crisis and strategic directions ahead

For decades, many researchers argued that economics had nothing to fear from enriching itself with lessons and advances from other disciplines. Unfortunately, these suggestions were either neglected or dismissed upfront in what was then arbitrarily considered mainstream economics. The global crisis has led even Nobel Prize winners to acknowledge that the problem facing economists and policy makers today is mostly intellectual - it is the need to confront the systematic failure of thinking, especially on the part of macroeconomists. Despite its unprecedented magnitude and heavy financial, human, and intellectual cost, the crisis certainly does not invalidate everything that has been learned about macroeconomics. However, the costs highlight some of mistakes of the dominant intellectual macroeconomic framework. Post-macroeconomics should not be understood as another metanarrative of the end of metanarratives. The use of the prefix post here suggests and emphasizes much more than temporal posterity. Post-macroeconomics should follow from macroeconomics more than it follows after macroeconomics. The theorizing of post-macroeconomics is therefore neither systematically oppositional nor hegemonic. It does not advocate a - dialectic opposition - between macroeconomics and post-macroeconomics. Rather, it suggests that the latter builds on the former and goes beyond it.Economic Theory&Research,Debt Markets,,Banks&Banking Reform,Access to Finance

Cluster-based industrial parks : a practical framework for action

They are being hailed as the new Holy Grail of economic development. The success of special economic zones (SEZ) in general and specialized ones in particular (industrial and technology parks) in countries as diverse as Australia, Denmark, Sweden, Germany, Switzerland, Ireland, Japan, the United Kingdom, the United States, and more recently, China; Korea; Taiwan, China; or Mauritius, has led several African leaders to launch new similar initiatives. This paper establishes a common point of reference for those who believe in the virtues of SEZs, explains why the many existing ones have not delivered the expected outcomes, and summarizes the key issues on the agenda. It then suggests cluster-based industrial parks as the most effective tool for developing competitive industries and generating employment, and provides some practical guidance to development practitioners and policymakers on the road ahead.Environmental Economics&Policies,Economic Theory&Research,Emerging Markets,Debt Markets,Labor Policies

A note on the decomposition of the coefficient of variation squared: comparing entropy and Dagum's methods

The aim of this paper is to propose a new decomposition of the coefficient of variation squared. The approach is similar to the Dagum's method when decomposing the Gini index. We compare the new method to the former entropy decomposition of this coefficient. An empirical study is elaborated. This concerns a subgroup decomposition of the non food expenditure cameronian households inequality.

Dynamics of income inequality and welfare in Latvia in the late 1990s

This paper analyzes the dynamics of poverty and income inequality during the recovery phase of the transition that characterized the Republic of Latvia in the late 1990s. Despite a continued rise in income inequality, empirical evidence suggests an improvement in living standards, owing largely to a significant surge in per capita income growth, particularly in urban areas. In a context of rising income inequality and widening urban-rural income and poverty gaps, the benefits of growth were not equally distributed, and poverty persisted in a number of regions (particularly the regions of Latgale and Vitzeme) and among some socioeconomic groups (particularly households deriving their main income from social benefits). In addition to income inequality and asset endowments, poverty appears to be highly correlated with a number of labor market-related variables, particularly unemployment, suggesting that the labor market could be an important transmission channel from growth to poverty. However, though positive, the association between poverty and unemployment is non linear, especially in urban areas, where the labor market and demand are the most important channels of transmission through which growth and macroeconomic development affect household income and living standards.Services&Transfers to Poor,Poverty Impact Evaluation,Health Economics&Finance,Environmental Economics&Policies,Poverty Monitoring&Analysis,Inequality,Environmental Economics&Policies,Safety Nets and Transfers,Rural Poverty Reduction,Services&Transfers to Poor

The growth report and new structural economics

Despite its heavy human, financial, and economic cost, the recent global recession provides a unique opportunity to reflect on the knowledge from several decades of growth research, draw policy lessons from the experience of successful countries, and explore new approaches going forward. In an increasingly globalized world where fighting poverty is not only a moral responsibility but also a strategy for confronting some of the major problems (diseases, malnutrition, insecurity and violence) that ignore boundaries and contribute to global insecurity, thinking about new ways of generating and sustaining growth is a crucial task for economists. This paper reassesses the evolution of knowledge on growth and suggests a new structural approach to the analysis. It offers a brief, critical review of lessons learned from growth research and examines the remaining challenges -- especially from the policy standpoint. It highlights how the 2008 Growth Commission Report identifies the stylized facts associated with sustained and inclusive growth. And it explains how the new structural economics provides a consistent framework for understanding the key findings of the Report.Economic Theory&Research,Achieving Shared Growth,Economic Growth,Political Economy,Inequality