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If data wants to be free, then PovcalNet, the world’s leading dataset on global poverty, is happier today because it was recently made available for download in bulk by my guests on this week’s Wonkcast CGD research fellow Justin Sandefur and research assistant Sarah Dykstra.
My guest this week, behavioral economist Sendhil Mullainathan, is a Harvard professor and non-resident fellow at CGD who is transforming how people think about poverty, and what can be done to support poor people in improving their lives. Sendhil was recently at CGD to discuss his new book, Scarcity: Why Having Too Little Means So Much, in which he explains that limited bandwidth—the ability to stand back from one’s life, assess trade-offs, and make rational choices—is a problem for all of us, but an especially difficult problem for those who live daily with scarcity.
Clare Walsh, a senior official in the Australian Department of Foreign Affairs and Trade and the chair of the Development Working Group of the G-20, recently visited CGD for a round-table discussion with CGD senior staff. Afterwards I hosted her and CGD senior associate, Scott Morris, a former senior US Treasury official, on the Wonkcast.
Regulators at the Bank for International Settlements (BIS) in Basel, Switzerland, are hard at work designing regulatory standards to avoid future financial meltdowns like the global financial crisis of 2008. Joining them for two months is Liliana Rojas Suarez, a CGD senior fellow and the founding chair of the Latin American Shadow Financial Regulatory Committee.
Economists, development and otherwise, often assume that people given the right information will make informed decisions in their own best interest. Not! Just like the rest of us, the poor people targeted by development programs sometimes lack self-control and fail to take actions that would benefit them in the long run, even when they understand the potential benefits.
This Wonkcast was originally recorded in February 2011. Andy Sumner updates the data from the original Bottom Billion brief in his recent working paper, Where Will the World's Poor Live? An Update on Global Poverty and the New Bottom Billion.
Paul Collier’s 2007 book, The Bottom Billion: Why the Poorest Countries are Failing and What Can Be Done About It, changed the way we think about poverty and development. Collier argued that the majority of the 5-billion people in the "developing world" live in countries with sustained high growth rates and would eventually escape from poverty. The rest—the bottom billion—live in 58 small, poor, often land-locked countries that are growing very slowly or not at all. These countries, stuck in poverty traps, should be the focus of foreign aid, Collier argued.
The debate over U.S. foreign assistance in Pakistan has grown hotter lately, with Stanford political scientist Stephen Krasner arguing in Foreign Affairs that the United States should get tough by threatening to halt aid to Pakistan to force the country into cooperating better on security matters. CGD president Nancy Birdsall responded with an article in Foreign Policy. Drawing on the recommendations of a 2011 CGD study group report, Beyond Bullets and Bombs: Fixing the U.S. Approach to Development in Pakistan, she argued that U.S. development assistance should be focused on helping to create a stable, prosperous Pakistan—goals that are in America’s own best interest and would be ill-served by trying to use the aid as a bargaining chip.
My guest on this week’s Wonkcast is David Roodman, senior fellow and author of the long-awaited book, Due Diligence: An Impertinent Inquiry into Microfinance. After more than three years of unprecedented investigation into the movement, David was able to cut through the hype and come to understand the capabilities and limitations of microfinance in ending poverty.