Schools are closed in Latin America. Around 154 million children between the ages of 5 and 18 are at home instead of in class. It is not clear how long these closures will last, and there is a good reason for that: Schools provide a perfect environment for the spread of viruses. Students are typically in close contact to one another, packed into classrooms, playing at recess, … [Read more...] about Pandemic and Inequality: How Much Human Capital Is Lost When Schools Close?
Social Distancing, Informality, and the Problem of Inequality
With more than a million people infected and tens of thousands of deaths around the world, governments are taking extreme but necessary measures to contain the coronavirus, prioritizing in almost all cases some form of social isolation or distancing. But the economic costs for everyone are not the same. The disease lays bare societies' inequalities, inflicting greater economic … [Read more...] about Social Distancing, Informality, and the Problem of Inequality
A Nobel Prize for Development: A Look From Inside the IDB
The awarding of the 2019 Nobel Prize in Economics to Abhijit Banerjee, Esther Duflo and Michael Kremer hits close to home for several reasons. First, in bringing "an experimental approach to alleviating global poverty," as the Nobel committee said in its Oct. 14 announcement of the prize, these distinguished economists have changed the way we do research at the Research … [Read more...] about A Nobel Prize for Development: A Look From Inside the IDB
Promoting Competition to Boost Welfare Through Social Programs
Since the mid-1990s, governments in Latin America have used conditional cash transfers (CCTs) to reduce poverty, improve health, and boost school enrollment for tens of millions of people. But like any social program that increases income and hence demand, CCTs pose their own risks if they allow for goods and services to be purchased in a non-competitive environment. That is … [Read more...] about Promoting Competition to Boost Welfare Through Social Programs
When an Excess of Small Firms Hurts Productivity
Policymakers have long accepted the central role of innovation in spurring aggregate productivity and growth. They have looked at the arrival of new systems of organization and new technologies, from the steam engine to electricity and the internet, as catalysts to material progress in the modern age. But in doing so, they may have underestimated the importance of another … [Read more...] about When an Excess of Small Firms Hurts Productivity