conference program

12th ANNUAL GLOBAL DEVELOPMENT CONFERENCE

In Partnership withOrganized by

BOGOT - COLOMBIAJANUARY 13-15, 2011

FINANCING DEVELOPMENTIN A POST-CRISIS WORLD:

The Need For a Fresh Look

CONFERENCE PROGRAM

Venue:Universidad de los Andes

Bogot - Colombia

GLOBAL DEVELOPMENT NETWORK

The Global Development Network (GDN) is a leading International Organization working with developing country researchers and policy research institutes to support the generation and sharing of world-class policy-relevant research on development, helping to strengthen capacity in the process. Founded in 1999, GDN is headquartered in New Delhi, with offices in Cairo and Washington. GDN works in collaboration with 11 Regional Network Partners (RNPs). Eight RNPs are based in developing countries and three in developed countries. Each RNP links numerous research institutes in its region and facilitates their contact with policymakers. GDN partners with various international donor organizations and Governments, a worldwide network of research insti-tutes, academic institutions, think tanks and more than 11,000 indivi-dual researchers worldwide. GDN believes that significant contribu-tions to development can be made by supporting capacity building of researchers, connecting them as a cadre of specialists across the deve-loping world. GDNs key activities comprise Global Research Projects, Awards & Medals Competition, Annual Conferences, Regional Research Competitions and GDNet knowledge portal communicating research from and for the Global South.

UNIVERSIDAD DE LOS ANDES

Founded on November 16, 1948, the University of the Andes (Bogot, Colombia) is an autonomous and independent institution which promo-tes pluralism, diversity, dialogue, discussion, criticism, tolerance and respect for the ideas, beliefs and values of its members. It also seeks academic excellence and gives students a critical and ethical training to strengthen their awareness of their social and civic responsibilities and their commitment to the analysis and solution of problems of the coun-try. To this end, develops and implements advanced methodologies in teaching and research, aimed at ensuring that the student is the princi-pal agent of his training and resolve issues to be presented with creati-vity and responsibility. Also, to encourage the comprehensive training, flexible interdisciplinary environment conducive essential to integrate the arts, science, technology and humanities. Aware of the need for a highly qualified teaching staff as a generator and propagator of knowledge, enables them University professors to develop their activi-ty as a way of life that allows them to achieve their aspirations and professional and personal development as a fundamental pillar of strengthening institutional. By having teaching and research programs of quality and internationally, in a climate of freedom and diversity, Los Andes has the mission to train professionals of integrity, responsible, imaginative, at high levels in their disciplines, strongly contribute to the cultural enhancement and country's economic and strengthening the values of coexistence and social peace.

Conference Overview 1

Conference Committees 2

GDN Donors & Conference Sponsors 3

Plenary Sessions 4

Parallel Sessions 8

Business Meetings (January 11, 12 & 14) 9 - 10

Pre-conference Training for Awards & Medals Finalists 11(January 11 & 12) Main Conference (January 13-15) 12 - 45

CONTENTS

We live in turbulent times. In a post-crisis world, we need innovative ideas and a fresh look at a broad range of development issues. A research and policy area in urgent need of a fresh approach and new ideas is development finance, broadly defined to include domestic resource mobilization and financial sector develop-ment as well as foreign aid and other external capital flows. In this context, it is not surprising that the global financial architecture is currently once again being questioned and the whole development finance system (or non-system) is being re-examined. Many donors are currently struggling to honor their aid commitments agreed in Hokkaido and Doha which were meant to accelerate progress towards the Millennium Development Goals (MDGs).

External capital flows are extremely volatile and are concentrating in certain developing countries and emerging markets whilst private capital flows and remittances are in decline. Add to this, the growing complexity of the develop-ment finance system (or non-system, which has become difficult to manage due to donor proliferation, fragmentation problems, and the emergence of a new group of donors with completely new aid modalities) and a new context in this area seems to have emerged. At the same time, however, the current problems with external capital flows have prompted a search for new windows of opportu-nity in the area of financing for development.

As a result microfinance is currently enjoying another revolution and issues related to financial sector development and the need to improve substantially financial access for those trapped in poverty have attracted a lot of attention as a series of recent reports suggests (e.g. the Report of the CGD Task Force on Access to Financial Services, 2009 and the Warwick Commission Report on International Financial Reform, 2009, among others). Furthermore, the interna-tional development community is now more open to new sources of develop-ment finance (such as those related to environmental taxation, currency tran-sactions tax and development-focused SDRs among others) which seemed to be unthinkable just a few years ago.

Finally, the rise of the new philanthropy in recent years is an interesting develo-pment which is expected to have various impacts in the wider area of develop-ment finance.

GDN 12th ANNUAL GLOBAL DEVELOPMENT CONFERENCEFINANCING DEVELOPMENT IN A POST-CRISIS WORLD:THE NEED FOR A FRESH LOOK

UNIVERSIDAD DE LOS ANDES, BOGOT - COLOMBIALOCAL PARTNER: UNIVERSIDAD DE LOS ANDES

JANUARY 13-15, 2011

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Abhijit Banerjee (MIT, USA)Mauricio Crdenas (Brookings Institution, USA)Gerardo della Paolera (GDN President)Alejandro Gaviria Uribe (Universidad de los Andes, Colombia)Ann Harrison (World Bank, USA)George Mavrotas (GDN Chief Economist & Conference Director)Pablo Andrs Neumeyer (Universidad Torcuato Di Tella, Argentina)Guillermo Perry (Harvard Kennedy School, USA & Fedesarrollo, Colombia)Jean-Philippe Platteau (University of Namur, Belgium)Vladimir Popov (New Economic School, Russia)Ernesto Zedillo (Chairman, GDN Board of Directors & Yale, USA)

Alejandro Gaviria Uribe, Dean, Department of EconomicsKarina Ricaute, General Secretary, Department of Economics Carolina Angel, Public Relations ManagerNatalia Cadavid, Adviser in Communication & Public Relations, Department of Economics Sussen Naged Rojas, Finance Assistant, Department of Economics Adriana Sierra, Public Relations CoordinatorCamilo Lpez, Public Relations Assistant

CONFERENCE PROGRAM COMMITTEE

LOCAL ORGANIZING COMMITTEE (Universidad de los Andes, Colombia)

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Against this new emerging landscape for financing development the GDN 12th Annual Global Development Conference in Bogot will try to take stock of what we have learnt so far in the broad field of develop-ment finance, delve deeper into the new modalities and mechanisms for financing development and take a fresh look at a broad range of policy issues emerging in this crucial area.

Australian Agency for International Development, AustraliaAustrian National Bank, AustriaFederal Ministry of Finance, AustriaInternational Development Research Centre, CanadaOpen Society Institute, HungaryMinistry of Finance, JapanPartnership for African Social and Governance Research, KenyaMinistry of Finance, LuxembourgNew Zealand Agency for International Development, New ZealandMinistry of Foreign Affairs, The NetherlandsDepartment for International Development, United KingdomBill & Melinda Gates Foundation, United StatesInter-American Development Bank, United StatesThe World Bank, United StatesUnited Nations Development Programme, United States

Ministry of Finance, ColombiaThe Mayor City of Bogot, ColombiaBanco de la Repblica, ColombiaProexport Colombia Inter-American Development Bank (IDB)Corporacin Andina de Fomento (CAF)

GDN DONORS

GDN CONFERENCE SPONSORS

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The purpose of this Opening Roundtable session, chaired by Ernesto Zedillo, Chairman, GDN Board of Directors, is to set the scene for what will be discussed over the next three days with a predominant focus on the central issues and the new agenda emerging in the broad area of development finance in the aftermath of the recent global financial crisis.

PLENARY 2Rethinking Microfinance

Appropriately designed financial institutions are crucial to improving the mobilization of savings in developing countries. The poor tend to have limited access to formal financial services and the lack of compe-tition means that they pay a high price. This often takes the form of high interest payments on loans. The poor also frequently pay for the chance to save: the nominal rates received on deposits are in many instances very low or even zero, meaning that the real interest rates are negative. In the absence of formal financial services, the poor rely on family and friends to provide loans on a reciprocal basis.

The number of informal financial institutions that have grown in deve-loping countries indicates the value placed on financial intermediation. Indeed, there exists a group of formal and informal financial institu-tions around the world that has developed to attend the needs of the smaller saver and investor. Formal, state-introduced mechanisms traditionally worked on the assumption that the poor did not have the capacity to save and needed direct credit to enable them to escape the poverty trap. Consequently, the institutions aimed to help the poor directly, through subsidy, rather than address their need for financial services. Yet, empirical work has shown that this assumption is inco-rrect; given the appropriate incentives, even the poorest individuals have savings that could be mobilized.

PLENARY 1Financing development in a post-crisis world: The new agenda

PLENARY SESSIONS

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More recently, however, partly due to the increasing attention paid to the overall nexus between finance and poverty and partly due to the phenomenal impact of the Grameen Bank and Muhammad Yunus pioneering work in this area, the whole idea that poor households are bankable has gained momentum. Founded in 1983, by 2006, Grameen was serving over six million poor customers in villages throughout Bangladesh. According to the Microcredit Summit Campaign, as of December 2007 microfinance institutions had more than 150 million clients of which more than 100 million were women; and recent statis-tics seem to suggest that microfinance is a $6.5 billion business world-wide.

It is important to note that when Muhammad Yunus started Grameen Bank the focus waswas serving over six million poor customers in villa-ges throughout Bangladesh. According to the Microcredit Summit Cam-paign, as of December 2007 microfinance institutions had more than 150 million clients of which more than 100 million were women; and recent statistics seem to suggest that microfinance is a $6.5 billion business worldwide. It is important to note that when Muhammad Yunus started Grameen Bank the focus was on microcredit rather than microfinance. The reason for moving from microcredit to microfinance is the recognition that poor people want to save and insure as well as borrow. Furthermore, perhaps the greatest triumph of microfinance is the demonstration that poor households can be reliable bank custo-mers. The microfinance revolution certainly improved access to finance for hundreds of millions of poor people worldwide.

Access to microfinance can expand poor households abilities to cope with emergencies, manage cash flows and invest in the future. However, although there are many success stories all over the world many obser-vers have repeatedly asked for careful differentiation between those changes that can be clearly attributed to financial access and those that might have happened anyway or result from other changes in the envi-ronment in which microfinance clients operate (i.e. whether the measu-rement of the true effect is biased by a selection effect). In recent years, this has resulted in a new and interesting literature on microfinance, which is still growing. Another long-standing debate in this area is rela-ted to the sharpness of the trade-off between outreach (i.e. the ability of a microfinance institution to reach poorer and more remote people) and its sustainability (i.e. its ability to cover its operating costs and possibly also its costs of serving new clients from its operating reve-nues). The use of randomized designs to estimate the true effect of microfinance on the poor is a very promising route for further research in this important area of development finance.

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PLENARY 3Financial Sector Development and Domestic Resource Mobilization:Another Angle to Look at the MDGs?

Recent years have witnessed a new interest in the financegrowth relationship, both at the micro and macro level and empirical research has flourished. Yet, the overall relationship between domestic resource mobilization and financial development has not been properly explored. The effective mobilization of domestic savings for private investment can play a crucial role in achieving growth and poverty reduction. Many developing countries have undertaken considerable financial reform over the last two decades (at least before the recent global financial crisis), including financial market liberalization, bank privatization and efforts to build the capacity of central banks and financial authorities to conduct prudential regulation and supervision of the liberalized financial system. The same has been true in the tran-sition economies, which have undertaken wholesale institutional reform to build a market-oriented financial system.

Yet, two problems have become apparent. Firstly, the construction of regulatory and supervisory capacity has often lagged behind liberali-zation: a number of low-income and transition countries have expe-rienced major bank crises (which in turn have destabilizing macroeco-nomic effects). Secondly, the domestic investment response to financial liberalization has often been disappointing; savings mobilization has continued to be low, and the newly liberalized systems have rarely effectively intermediated savings into new and higher levels of domes-tic investment.

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As has been argued recently by Banerjee et al. (2009), the ideal experi-ment to estimate the effect of micro credit appears to be to randomly assign micro credit to some areas, and not some others, and compare outcomes in both sets of areas: randomization would ensure that the only difference between residents of these areas is the greater ease of access to microcredit in the treatment area.

Given the above, it is clear that further empirical work is urgently needed to delve deeper into the various debates surrounding microfi-nance in order to develop a useful policy agenda for this crucial area of development finance, which is of utmost importance for the poor people in the developing world.

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Moreover, lending to domestic investors continued to be focused overwhelmingly on larger borrowers, with small and medium-sized enterprises continuing to have inadequate access to formal financial lending. Against this background, the effectiveness of financial reform in achieving high levels of investment and growth (let alone develop-ment) remains in doubt. Furthermore, the contribution of the financial sector to the achievement of faster poverty reduction (through the achievement of higher wage-employment growth and self-employment in small and medium-size enterprises) appears to be meager at best in many countries.

And of course, financial crises can result in recession, which endangers macroeconomic stability and increases unemployment and poverty. Overall, we have only a limited understanding of the channels through which the financial sector affects investment behavior, its effects on savings rates and the interaction between domestic financial flows and external financial flows. Needless to say, this is a critical issue in a post-crisis world and in view of the need to accelerate further progress towards the MDGs, to encourage the flow of private capital to develo-ping countries and ensure its effective use for investment and pro-poor development. Whilst the important link between financial development and growth has been explored for many years, recent research has focused on the follow-up link between financial development and poverty reduction.

It is therefore crucial to shed light on the channels through which finan-cial development can promote poverty reduction. In addition to the important more indirect link through the promotion of economic growth, thought must be given to making financial development more pro-poor in a direct way, and making the economic growth resulting from it more pro-poor. Promising work in this area seems to confirm the extreme importance of strengthening the link between financial deve-lopment and poverty reduction. Research findings are also ambiguous when it comes to the relationship between financial development and changes in poverty and income distribution. According to some models, financial market imperfections (such as asymmetric information, tran-sactions and contract enforcement costs) are more binding on poor entrepreneurs who lack collateral, credit histories and connections. These credit constraints thus impede the flow of capital to under-privileged individuals with high-returns projects, reducing the efficien-cy of capital allocation and worsening income inequality. Viewed from this angle, financial development can reduce poverty by relaxing the credit constraints on under-privileged individuals, thereby improving the allocation of capital and accelerating growth.

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PLENARY 4Innovative Sources of Development Finance and the Rise of the New Philanthropy

In the wake of the global financial crisis and with progress towards the MDGs faltering, new sources of development finance, beyond traditio-nal sources such as Official Development Assistance (ODA), have become an important dimension of the current discussion on develop-ment finance. Considering new sources of development finance is by no means an entirely new agenda in development finance since Monterrey but it has attracted more attention in the aftermath of the financial crisis. Indeed, if more money from existing sources of development finance is not expected to be available shortly due to the crisis implica-tions, then ideas (and action) for innovative sources of finance are crucial.

Various proposals were discussed in detail in the influential Atkinson Report (OUP and UNU-WIDER, 2004) including the taxation of environmental externalities for development purposes, the development-focused allocation of the Special Drawing Rights (SDRs), the much debated Currency Transactions Tax, better known as Tobin tax and international remittances, among others. Particular attention was paid at that time to three central issues which remain relevant due to the need to think of new ways of financing development in the aftermath of the global financial crisis: (1) the feasibility of the proposals, (2) the revenue potential of the proposals and (3) the issue of the double dividend.

Obviously, the feasibility of the new sources for financing development is strongly related to their political economy, namely the need to consider not only how a national government should behave, but also how national governments do behave in each case. This also covers the likelihood of the various proposals being adopted.

Others Question whether financial development reduces poverty, citing that the poor primarily rely on the informal sector and family connec-tions for capital. Therefore, improvements in the formal financial sector do not necessarily benefit the poor. This important debate calls for more reflection and more empirical work so more pro-poor policies can be developed and implemented.

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Do we need, for example, universal agreement in certain cases or a flexible geometry approach (i.e. a group of governments can move together in adopting one of the proposals and implement it, thus gene-rating further revenue for development purposes)? The revenue poten-tial of the various innovative sources of funding is also crucial (i.e. how much revenue can be raised in each case?) To what extent would that fill the current gap in financing development in view of the current level of ODA? The issue of double dividend is also central since it poses the question as to whether the new source of development finance can generate revenue for development purposes and at the same time help reduce environmental damage (for example, the taxation of environ-mental externalities).

The additionality issue is another important topic in the search for new ideas for development finance. The issue centers on whether the new source will be additional to ODA flows or will crowd out ODA and other traditional sources. Development focused SDRs are a particularly interesting proposal. George Soros, one of its key proponents, has argued that new SDRs should be created and that developed countries should re-allocate their share of the SDR issue to the funding of global public goods and to supplementing aid flows to individual developing countries. Needless to say, this is now a very pertinent issue, given the need of developing countries to accumulate reserves in order to cope with the vulnerability arising from financial crises. The recent rise of the new philanthropy is a very important development in the area of innovative sources of development finance.

It requires special attention. Although charitable giving in rich coun-tries is considerable (1.5 per cent of national income in the US a few years back), the majority of philanthropic activity in rich countries is aimed at domestic concerns. Furthermore, a substantial fraction of philanthropic activities are focused predominantly on humanitarian and emergency assistance following natural disasters and also with countries emerging from conflict. There are also a number of private foundations with strong development interests such as the Ford, Rocke-feller, Soros, Gates and Hewlett foundations and, more recently, the UN Foundation, set up by Ted Turner, among others.

The potential for raising private donations for development purposes is sizeable and requires further discussion amongst the international development community because in many cases the example of indivi-dual citizens may encourage national governments to be more gene-rous when it comes to financing development.

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No topic has had quite such a long, uninterrupted and volatile history as foreign aid. For decades it has captivated academics, policymakers and practitioners alike. As Roger Riddell, succinctly put it, in his recent book Does Aid Really Work? (2007), aid has managed, repeatedly, to reinvent and renew itself after repeated bouts of uncertainty, doubt and pessimism. Robert Cassen, in his influential study Does Aid Work? (1986), argued quite rightly that, much of the public discussion of aid has been distorted by prejudice, ideology and selective glimpses of parts of the evidence, and that, most aid does succeed in terms of its own objectives and obtains a reasonable rate of return; but a significant proportion does not.

However, more than twenty years after the publication of this seminal study, aid issues are still vulnerable to domination by politics and ideology. Yet, the overall context in which development aid is now perceived and assessed is dramatically different. The UN Doha Conference clearly stressed that the international context of foreign aid has changed profoundly since Monterrey. In particular, the Doha Declaration on Financing for Development (2008) emphasized that the international community is now facing the severe impact on development caused by multiple, interrelated global crises and challenges which include food insecurity, volatile energy and commo-dity prices, climate change, and above all, the global financial crisis.

More recently, the European Report on Development (2009) emphasi-zed that, the closely linked food, fuel and financial shocks threaten to reverse the recent progress made towards the MDGs. and that the human costs of the crises are particularly worrying for fragile SSA countries where the ability to cope with shocks is limited. So what might the next decade hold for aid effectiveness? In trying to answer this challenging question we would agree with Ravi Kanbur (2006) who stressed that, the macro-econometric investigation of aid-growth regressions will no doubt continue into the next century, since,

PLENARY 5Development Aid: The Emerging New Landscape

Furthermore, the current forward looking development agenda of some of the new private foundations and their modalities in implementing that agenda may be instrumental in influencing the development agenda of many donors. Finally, very recent initiatives in this area by Bill Gates, among others (June 2010) have already attracted a lot of attention.

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.there are sufficient issues of data (how exactly is aid defined?), of econometrics (how can the truly independent effects of aid be identified from a mix of independent relationships?) and of development doctrine (what is good policy?) to keep the debate alive. It is also important to remember that in the long history of the empirics of aid, negative studies (i.e. studies concluding that aids impact on growth was negati-ve) have dominated the lively debate on aid effectiveness and received substantial coverage in the media.

At the same time, recent calls for increasing aid have generated a new interest among researchers and policy makers regarding the macroeconomic implications of such a big-push approach. Further-more, and of relevance to the above, there exists an ongoing debate as to whether additional aid could be absorbed effectively. Issues related to aid volatility, aid heterogeneity, fiscal response to increased aid inflows and those related to political economy aspects of aid have all also recently been under investigation.

A central message emanating from recent work is that it is not sufficient to scale up aid efforts by raising and transferring more money. Insuffi-cient targeting of sector-specific aid must take part of the blame for the lack of progress made towards the MDGs so far. Unless aid is better targeted, scaling up aid is unlikely to have the desired effects. Further-more, the big push and absorptive capacity approaches cannot be reconciled without a reform on the aid architecture associated with recent calls for scaling up aid. It would be, therefore, a missed opportu-nity to increase aid without considering the apparatus for delivering such large amounts of money. Needless to say, fiscal response issues (i.e. how the aid recipient government responds in the presence of increased aid flows), issues related to the volatility and unpredictability of aid and also research work on aid heterogeneity (i.e. how different types of aid operate) are becoming quite timely now in view of the need to scale up aid to accelerate progress towards the MDGs and more importantly, in order to deal with the triple crisis.

Further work is also required regarding aid allocation criteria, an area that has received much attention in recent years. Looking back at the long running debate on aid it seems fair to argue that we now know more about the macroeconomic impact of aid because we now have better data on aid, we have been able to use better methodologies and econometrics to delve deeper into some of these issues and also we have been able to draw carefully on at least some of the lessons emana-ting from recent empirical work on aid effectiveness.

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Chaired by Gerardo della Paolera, GDN President, this concluding roundtable will summarize what has been discussed over the last three days at the conference, focus on the central policy lessons emanating from the discussion and suggest innovative ways for the way forward.

PLENARY 6Concluding PlenaryFinancing Development: Looking into the Future

Yet, a number of important challenges still remain in this crucial area of development finance. In this context, it is absolutely vital to, firstly, take a fresh look at development aid, since aid remains crucial for human development and poverty reduction for many regions in the world, and secondly, to make a concerted effort to overcome the numerous inefficiencies of the past and make aid work better for the 1.4 billion poor people in the world. Finally, recent years have witnessed the emergence of new aid donors from the South, a development that has implications for the future of development aid.

Of relevance here is the recent High-Level Event on South-South Co-operation organized in Bogot in March 2010, which endorsed the Bogot Statement towards effective and inclusive development partnerships in the area of South-South Co-operation (SSC). The event was held as part of the aid effectiveness agenda and the process leading up to the 4th High-Level Forum on Aid Effectiveness in late 2011 in Korea. The Bogot event viewed SSC not as a substitute, but rather as a complement to North-South development cooperation, with triangular cooperation acting as a bridge between South-South and North-South cooperation. This is certainly an area that will attract a lot of attention in the near future.

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Various Parallel Sessions are also organized at the Bogot Conference by GDN in connection with the Awards and Medals Competition, GDNs Regional Network Partners as well as external partners (as listed below).

PARALLEL SESSIONS

PARALLEL SESSIONS 1.1 - 1.3

PARALLEL SESSION 1.1Organized by the Latin American and Caribbean Economic Association(LACEA)PARALLEL SESSION 1.2Organized by the Fiscal Affairs Department of the InternationalMonetary Fund (IMF)

PARALLEL SESSION 1.3Organized by the Bureau for Research and Analysis of Development(BREAD)

PARALLEL SESSIONS 2.1 - 2.3 & 3.1 - 3.2

PARALLEL SESSIONS 3.3

Organized by the World Bank Institute (WBI)


Organized by the European Development Research Network (EUDN)


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Five sessions organized by GDN for the 2010 Global Development Awards & Medals Competition

Jointly organized by the Latin America & Caribbean Region - World Bank & Corporacin Andina de Fomento (CAF)

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BUSINESS MEETINGS:JANUARY 11, 12 & 14, 2011

TUESDAY, JANUARY 11, 2011

9:00 A.M. - 6:00 P.M.Location: Council Room ML 805, 8th Floor, Mario Laserna Building

Meeting of the GDN Board of Directors (by invitation only)

1:00 P.M. - 2:00 P.M.Location: Council Room ML 805, 8th Floor, Mario Laserna Building

Lunch (by invitation only)

WEDNESDAY, JANUARY 12, 2011


Meeting of the Heads of GDN's Regional Network Partners (by invitation only)



FRIDAY, JANUARY 14, 2011


Meeting of the Donor Advisory Committee (by invitation only)

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TWO-DAY GDNet RESEARCH COMMUNICATIONS TRAININGFOR AWARDS & MEDALS FINALISTS

It is increasingly not enough for scholars to be methodologically thorough and to produce robust and objective research. To be effective, they need also to be proficient communicators who can engage policymakers and the media in their results and its implications for wider development debates. A special two-day GDNet Communications Training for Awards and Medals finalists will strengthen the capacity of Awards and Medals finalists to identify the headlines of their research and to write it for a range of different audiences, and to present it in an engaging style to other scholars at the conference and the judging committee.

The Training will showcase inspiration speakers and work with participants to develop principles of effective communication in the written and spoken word. It will use video-critique and peer-review methods to improve the styles and build the confidence of participants to present their work in different forums, includ-ing at the Conference Ceremony later in the week.

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BUSINESS MEETINGS:JANUARY 11, 12 & 14, 2011



Meeting of the GDN Board of Directors (by invitation only)





Meeting of the Heads of GDN's Regional Network Partners (by invitation only)



FRIDAY, JANUARY 14, 2011


Meeting of the Donor Advisory Committee (by invitation only)

1.00 PM 2.00 PM Location: Council Room ML 805, 8th Floor, Mario Laserna Building


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PRE CONFERENCE TWO-DAY GDNet RESEARCH COMMUNICATIONS TRAINING FOR AWARDS & MEDALS FINALISTS: JANUARY 11 - 12, 2011


9.00 AM 6.00 PMLocation: Room W 402, 4th Floor

1.00 PM 2.00 PM Location: 5th Floor Terrace, Mario Laserna Building

Lunch


9.00 AM 6.00 PMLocation: Room W 402, 4th Floor

1.00 PM 2.00 PM Location: 5th Floor Terrace, Mario Laserna Building

Lunch

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MAIN CONFERENCE: JANUARY 13 - 15, 2011DAY I - THURSDAY, JANUARY 13, 2011

8:30 AM 9:30 AMLocation: Mario Laserna Auditorium B, Mario Laserna Building

OPENING CEREMONY

CHAIRPERSON

Ernesto Zedillo Chair, GDN Board of Directors and Director, Yale Center for the Study of Globalization, USA

CONFERENCE OPENING SPEECH

H.E. Juan Manuel Santos President of Colombia

PLENARY 1 (Opening Roundtable)9:30 AM 11:15 AMLocation: Mario Laserna Auditorium B, Mario Laserna Building

FINANCING DEVELOPMENT IN A POST-CRISIS WORLD: THE NEW AGENDA

CHAIRPERSON


WELCOME REMARKS

Juan Carlos Echeverry Finance Minister of Colombia

Carlos Angulo Galvis President, Universidad de los Andes, Colombia

THURSDAYJanuary 13th, 2011

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Gerardo della Paolera President, Global Development Network

PANELISTS

Francois Bourguignon Director, Paris School of Economics, France

Asli Demirguc-Kunt Chief Economist of the Financial and Private Sector Network and Senior Research Manager of Finance and Private Sector, World Bank, USA

Roberto Steiner Director, Fedesarrollo, Colombia

Alan Winters Member, GDN Board of Directors Chief Economist, Department for International Development UK Professor, University of Sussex - UK

11:15 AM 11:30 AMLocation: 5th Floor, Mario Laserna Building

Tea / Coffee Break

11:30 AM 1:00 PM

PARALLELS 1.1 1.3

PARALLEL 1.1 Financial Crisis and Financial Inclusion: What we know, and what can be done? Location: Mario Laserna Auditorium A, Mario Laserna Building Organized by the Latin American and Caribbean Economic Association (LACEA)

This session will discuss what are the policy options to increase the participation of poor households into the financial system. This session will also address and summarize research done in Latin America at the village and household level on how formal and informal financial contracts are developed. In particular, the session will discuss the role that social networks have in the development of insurance informal instruments. It will also address the determinants of financial participa-tion among households, and how contracts can be changed in order to increase take-up rates in micro lending and micro insurance.


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The relationship between financial inefficiencies and income inequality and poverty is also addressed. Finally, this session will showcase the role that the government has in facilitating and completing financial mar-kets. In particular, the government insurance program in Chile which has been very successful in providing the guarantees needed by the banking sector to alleviate the problems of micro-lending.

MODERATOR

Roberto Rigobon Society of Sloan Fellows Professor of Applied Economics, Sloan School of Management Massachusetts Institute of Technology, USA

SPEAKERS

Luis Ballesteros Project Specialist and Researcher Sistema Nacional de Proteccin Civil, Mexico

Kevin Cowan Director of the Financial Policy Division Banco Central de Chile, Chile

Joo Manoel Pinho de Mello Assistant Professor Pontificia Universidade Catlica do Rio de Janeiro, Brazil

The Millennium Development Goals stressed the need to strengthen domestic revenue mobilization for development progress, and there is recent heightened interest in this topic from many sidesthe G-20 lead-ers; international organizations beyond the IMF and World Bank; bi-lateral aid donors. Yet, and despite much technical assistance and attention to this area, revenue ratios in non-natural-resource-rich low-income countries have essentially stagnated.

PARALLEL 1.2 Financing Development: Domestic Resource Mobilization, Past Experience and Future ChallengesLocation: ML 603, 6th Floor, Mario Laserna Building Organized by the Fiscal Affairs Department of the International Monetary Fund

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This session will look at past experiencessuccessful and less soand at future challenges and issues. Questions include, among others: the succession of major ideas in the area and the results and promise thereof (e.g., VAT, large taxpayer units, revenue authorities, taxation and gover-nance links...); informality, and more broadly the taxation of small and medium enterprises; distributional issues (inter- and intra-country, including problems in capital taxation); increasing regional integration; impact of trade liberalization; the role of the financial system in low-income countries. Underlying all of these issues are questions both of tax policy and of administration, which the session will address.

CHAIRPERSON

Victoria Perry Division Chief of the Revenue Administration Division Fiscal Affairs Department, International Monetary Fund, USA

SPEAKERS

Victoria Perry, Financing Development: Domestic Resource Mobilization, Past Experience and Future Challenges Division Chief of the Revenue Administration Division Fiscal Affairs Department, International Monetary Fund, USA

Pierre Jacquet Chief Economist Agence Franaise de Dveloppement, France

Ravi Kanbur Member, GDN Board of Directors and T.H. Lee Professor of World Affairs, Cornell University, USA

PARALLEL 1.3 Credit Instruments and Effects on Credit Access, Savings and Remittances Location: ML 608, 6th Floor, Mario Laserna BuildingOrganized by the Bureau for Research and Analysis of Development (BREAD)

This session provides evidence concerning determinants of credit access, savings and remittance flows in Brazil, Malawi and El Salvador, with implications for policies pertaining to design of credit instruments. In the context of Brazil, Rangel's paper examines the impact of a new legal reform enabling direct payroll deductions of debt payments on credit access and entrepreneurship.


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Gin presents evidence of effects of offering commitment savings products in Malawi which restrict timing of withdrawals. Yang's paper evaluates a policy experiment with creating financial instruments which allow migrants from El Salvador greater control over the use of their remittances back home.

Sam Schulhofer-WohlSenior EconomistFederal Reserve Bank of Minneapolis, USA

Xavier Gin, Commitments to Save: A Field Experiment in Rural Malawi" (with Lasse Brune, Jess Goldberg and Dean Yang) Senior Economist, World Bank, USA

Marcos Rangel, "Occupational Choice and Commitment Power: Inferen-tial Evidence from Changes in the Availability of Credit Instruments" (with Gabriel Madeira, Marcos A. Rangel and Mauro Rodrigues)Professor, University of Sao Paulo, Brazil

Dean Yang, "Remittances and the Problem of Control: A Field Experiment Among Migrants from El Salvador" (with Nava Ashraf, Diego Ayinemo and Claudia Martinez)Associate Professor of Public Policy and EconomicsGerald R. Ford School of Public Policy and Department of EconomicsUniversity of Michigan, USA

Xavier Gin Senior Economist, World Bank, USA

Sam Schulhofer-WohlSenior EconomistFederal Reserve Bank of Minneapolis, USA

CHAIRPERSON

DISCUSSANTS

SPEAKERS

1:00 PM 2:00 PMLocation: 5th Floor, Mario Laserna Building

Lunch

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2:00 PM 4:00 PMLocation: Mario Laserna Auditorium B, Mario Laserna Building

PLENARY 2 RETHINKING MICROFINANCE

CHAIRPERSON

Alejandro Gaviria Uribe Dean, Department of Economics Universidad de los Andes, Colombia

LEAD SPEAKER

Xavier Gin Senior Economist, World Bank, USA

DISCUSSANTS

Stefan Klonner Professor, Department of Economics, Johann Wolfgang Goethe Universitat, Germany

Victor Murinde Professor, Birmingham Business School, University of Birmingham, UK

4:00 PM - 4:30 PMLocation: 5th Floor, Mario Laserna Building

Tea / Coffee Break

4:30 PM - 6:30 PM

PARALLELS 2.1 2.3

PARALLEL 2.1 External Capital Flows and Financing for Development (Theme 1)Location: Mario Laserna Auditorium APresentation by Finalists of the 2010 Global Development Medals Competition


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Capital inflows, particularly in the form of FDI, are supposed to bring improved technology, management techniques, and access to interna-tional networks, all of which further raise productivity and growth. While we observed an increase trend of private capital flows during the last couple of decades, they continue to be concentrated in a small group of large middle-income countries, to be highly volatile and reversible, and more importantly, significantly lower than what is predicted by the stan-dard neoclassical models.

The so-called Lucas paradox argues that given the implications of the frictionless neoclassical theory, the fact that more capital does not flow from rich countries to poor countries constitutes a paradox. Further research has shown that although capital is potentially productive and has a high return in developing countries it does not flow there because of market failures. Needless to say, the current financial crisis has revived inter alia the debate over the merits of international financial integration and free capital mobility. Indeed, for some observers, international finan-cial integration enables developing countries to raise money from exter-nal markets, thereby channeling financial resources to their most productive uses and facilitating an efficient global allocation of savings. For others though, it increases macroeconomic volatility because the easing of controls on capital mobility was at the center of most currency crises in the emerging markets during the last decade.

Therefore, restricting capital mobility might reduce a countrys vulner-ability to external shocks and financial crises, and might allow countries to emerge from crises sooner than they would have otherwise. Other authors have pointed out the issue of sudden stops of capital inflows, i.e. situations in which the flow of capital coming into a country is reduced significantly in a very short period of time. These boom-bust cycles of capital flows have been particularly damaging for developing countries as they increased growth volatility, especially in those developing coun-tries that have integrated to a larger extent into international financial markets.

Turning to the case of Official Development Assistance (ODA), the current economic slowdown in many donor countries will probably lead to a contraction in ODA flows. Having said that, it is also important to remem-ber that for low-income countries, ODA remains an important source of foreign exchange than exports and this becomes even more important in a post-crisis setting.

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Needless to say, issues related to aid effectiveness will continue to preoc-cupy donors and recipients alike in view of the lack of consensus in this important area, and a huge effort is necessary to make aid work better for the poor. As for remittances, they have become a significant source of foreign exchange for many developing countries and an important source of financial support for recipient families. Remittances area vehicle through which poverty levels can be alleviated by spending on improving nutrition, financing childrens schooling or basic health care. With the fall in crucial investment, a decline in demand for exports and volatile commodity prices, a decline in remittances will pose serious challenges for low-income countries that depend on these capital flows. Under this theme, we are inviting submissions from all social science disciplines that will broadly address (but are not limited to) the questions below. Case studies and comparative case studies are particularly encouraged.

1. What are the main determinants of capital flow volatility? Does institu-tional quality influence the volatility of capital flows?2. What are the main constraints in improving the effectiveness of foreign aid and making aid work better for the poor?3. What we know and what we do not know regarding the relationship between FDI and growth? Does success build on success?4. Does aid work in post-conflict situations and what are the central issues involved in this case?5. What are the instruments that can be used by the government to turn remittances into more productive as well as developmental invest-ments?6. How the Lucas paradox regarding private capital flows can be viewed in the context of the recent global financial crisis?

CHAIRPERSON

Jean-Luc Maurer President, European Association of Development Research and Training Institute (EADI) Professor, Graduate Institute, Geneva

PRESENTERS

Zorobabel Bicaba, Do financial reforms complementarity and reforms sequence matter for international capital inflows? PhD Student, Universit Paris-Sorbonne, Paris and CERDI, Universit dAuvergne, France


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Puja Guha, Macroeconomic Transmission Channels of International Remittances: The Micro to Macro Level AdjustmentsResearch Economist, National Institute of Advanced Studies, India

Tomas Havranek, Which Foreigners Are Worth Wooing? A Meta-Analysis of Vertical Spillovers from FDI PhD Student, Charles University, Institute of Economic Studies, Prague

Eric Gabin Kilama, Multilateral Assistance to least developed countries: A Guide for the perplexed PhD Student, CERDI, Universit d Auvergne, France

Aljaz Kuncic, Aid us winning the elections: Foreign aid and voter turnout Researcher, University of Ljubljana, Faculty of Social Sciences, Slovenia

PARALLEL 2.2 Domestic Resource Mobilization and Financial Sector Development: Another Angle to look at the MDGs in the post-crisis world? (Theme 2)Location: ML 603, 6th Floor, Mario Laserna BuildingPresentation by Finalists of the 2010 Global Development Medals Competition

Despite the recognized benefits of financial intermediaries in terms of domestic resource mobilization and efficient allocation of capital, banks and financial markets are not performing well, particularly in low-income countries. Indeed, greater access to financial services can enable domestic firms to invest in high return projects thereby increasing the productivity and growth of the overall economy. At the same time it can help poor people to have access to land and shelter and to invest in productivity enhancing assets such as fertilizer, better seeds, machinery and other equipment.

Moreover, with insurance mechanisms provided by financial markets, households and small firms can greatly reduce their vulnerability to unfortunate events such as economic instability, drought, and disease. The last two decades have witnessed many efforts from developing coun-try governments to liberalize their financial sectors in their economies. According to some views, financial sectors in these countries were repressed. Therefore, an increase in real interest rates following liber-alization should encourage saving and expand the supply of credit avail-able to domestic investors, thereby enabling the economy to grow more quickly. It has to be stressed, however, that while increases in real inter-est rates have often been the outcome of liberalization episodes, their impact on domestic saving and investment has been mixed.

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Furthermore, in spite of a situation of highly liquid banking systems, credit has been often rationed to borrowers due to asymmetric informa-tion problems. This situation occurs because lenders cannot distinguish between borrowers of different degrees of risk. So loan contracts become subject to limited liability.

In this context, microfinance emerged as an especially promising way to rethink banking for the poor. While microfinance institutions have expanded vigorously in a number of countries, the size of their credit remains limited. Also, due to the large administrative costs in connection with the scale of their operations, the level of interest rate observed on micro credits is very high. Finally, the financial crisis has raised inter alia the need to rethink domestic financial systems in a way to help develop-ing countries to make further progress with the Millennium Develop-ment Goals (MDGs).

The fate of the bottom billion in the coming years will crucially depend on how the market failures attributed to causes such as urban-biased credit allocation, high transaction costs and interest rate restrictions will be sorted out so that sustainable financial systems could emerge that offer a wide-ranging menu of financial services, including savings and insurance, to poor people. Under this theme, we are inviting submissions from all social science disciplines that will broadly address (but are not limited to) the questions below. Case studies and comparative case stud-ies are particularly encouraged.

1. How does financial sector development spur economic welfare and what is the quantitative importance of financial development on income growth?2. What is the direct and indirect impact of financial development on poverty, health, gender equality, and education?3. What is the current state of financial development and access to finan-cial services, especially for poor households and smaller firms?4. What are the causes of a lack of access to finance for poorer house-holds and smaller firms?5. How governments in developing countries can build inclusive financial sectors for growth and poverty reduction?6. Does banking liberalization create financial fragility and increase informational problems?


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Biman Prasad RNP Head, ODN & Dean of the Faculty of Business and EconomicsUniversity of the South Pacific, Fiji

Marc Hofstetter, Effects of a Mortgage Interest Rate SubsidyAssociate Professor, Universidad de Los Andes, Colombia

Sabyasachi Kar, Banks, Stock Markets and Output: Interactions in the Indian EconomyAssociate Professor, Institute of Economic Growth, India.

Siong Hook Law, The Role of Financial Development on Income Inequal-ity in MalaysiaAssociate Professor, Universiti Putra, Malaysia

Francis Rathinam, Procedural Law, Judicial Efficiency, and Debt Finance: Evidence from IndiaFellow, Indian Council for Research on International Economic Rela-tions, India

Maria Sucre Reyes, Access to finance, growth and poverty: How close are the links in the case of Bolivia?Assistant Professor, Universidad Mayor de San Simn, Cochabamba, Bolivia

SPEAKERS

CHAIRPERSON

PARALLEL 2.3 Innovative Sources of Development Finance (Theme 3)Location: ML - 608Presentation by Finalists of the 2010 Global Development Medals Competition

After decades of debate, there is now a clear scientific consensus that climate change is occurring and that human activities are a major contributing factor. According to IPCC, since the Industrial Revolution, levels of carbon dioxide in the atmosphere have grown by more than 30 percent as a result of burning fossil fuels, land use change, and other man-made emissions. This human behavior has amplified the natural greenhouse effect, leading to an average surface temperature increase of 0.6C during the twentieth century.

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For developing countries, this situation will likely engender more catas-trophes to cope with (drought, floods) and will pose new challenges inso-far as the mismanagement of climate change will hamper or reverse development progress. At the same time, poverty and inequality are increasing everywhere in developing countries due to market imperfec-tions. According to DFID, some 25,000 children die everyday from easily preventable and treatable diseases and 1.4 billion people still live on less than $1.25 a day, more than two-thirds of them are women and girls. More importantly, there is a high probability for those people to be trapped in poverty because of situation of war, political instability and natural disasters.

Furthermore, the recent financial crisis has hit seriously many donor countries and is currently threatening their pre-crisis commitment to allocate more aid in order to accelerate progress with the Millennium Development Goals (MDGs). In this context, many new mechanisms like the carbon tax, the currency transactions tax, better known as Tobin tax, and the rise of the new philanthropy among others can provide us with the innovative means to increase resources for development by also ensuring a more inclusive and sustainable pattern of growth. The ratio-nale behind environmental taxes is that individual agents do not take account of the effects of their own actions on the welfare of others. So levying a tax that reflects the social impact of these harmful effects leads agents to act in a more responsible manner.

The optimal environmental tax internalizes the externality and restores the efficiency of the market mechanism. Thus, putting a price on green-house gas emissions will have a significant effect on country and com-pany system of incentives. However, carbon finance encompasses a broader concept of market solutions to climate change i.e. all policies that have the potential to change the cost structure in the corporate sector, while creating new markets and product opportunities for others. More importantly, it might generate important resources to help low income countries to cope with the adverse consequences of climate change. As for the Tobin tax, although being proposed in 1972 by James Tobin, it has gained renewed interest recently because of the growing recognition for a new international financial architecture in the after-math of the financial crisis but also the need to offset the decline of Official Development Assistance (ODA) from donor countries. The idea of James Tobin was to set up a currency transaction tax which purpose will be to reduce excessive exchange rate volatilities and short term specula-tive currency flows.


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This mechanism has generated a long and persistent debate in academic and policy circles. Finally, a new philanthropy has recently emerged as an important actor in the field of development. Philanthropy has taken in the past many forms like volunteering in non governmental organiza-tions but more recently super-rich individuals have investing in the development field with huge resources. The rise of new philanthropy is currently an important feature in financing for development and needs to be further studied. Under this theme, we are inviting submissions from all social science disciplines that will broadly address (but are not limited to) the questions below. Case studies and comparative case studies are particularly encouraged.

1. What is the relationship between innovative sources of development finance and an expansion of ODA? 2. How the central issues of feasibility and political will are relevant to the current discussion and debate regarding innovative sources of devel-opment finance? 3. How does carbon finance need to evolve in order to play a significant role in the move towards a low-carbon economy and green growth?4. What are the technical and political challenges for the implementation of the currency transactions tax, better known as Tobin Tax?5. Are the proceeds of a Tobin tax to be seen as a net addition to the flow of external resources or as an alternative to ODA? 6. To what extent can development benefit from the rise of the new philanthropy in recent years?

Vladimir GligorovProfessor, The Vienna Institute for International Economic Studies (WIIW), Austria

Musiliu Adewole, Innovative Source of Development Finance for Africa: the return of stolen fundsAssistant Lecturer, Covenant University, Nigeria

Joy Kiiru, The impact of microfinance on rural poor households income and vulnerability to poverty: case study of Makueni District, KenyaLecturer, University of Nairobi, Kenya

SPEAKERS

CHAIRPERSON

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Surender Kumar, Stock Prices of Clean Energy Firms, Oil and Carbon Markets: A Vector Autoregressive AnalysisProfessor, TERI University, India

Kala Seetharam Sridhar, Innovative sources of development finance: The role of land in financing Indias large cities and comparisons with ChinaSenior Research Fellow, Public Affairs Centre, India Krzysztof Wasniewski, Emergence of alternative capital markets in developing countries as a process of institutional changeAssistant Professor, Department of Economics and Management, The Andrzej Frycz Modrzewski Cracow University, Poland

7.30 PM 9.30 PMLocation: Museo del Oro (Gold Museum), Calle 16, No. 5-41, Bogot

OPENING CONFERENCE RECEPTION (sponsored by Banco de la Repblica, Colombia)

CHAIRPERSON


WELCOME REMARKS

Jos Daro Uribe Escobar Governor, Central Bank of Colombia - Banco de la Repblica, Colombia

KEYNOTE SPEAKER

Luis Alberto Moreno President, Inter-American Development Bank, USA


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FRIDAYJanuary 14th, 2011

DAY II - FRIDAY, JANUARY 14, 2011


PLENARY 3 FINANCIAL SECTOR DEVELOPMENT AND DOMESTIC RESOURCE MOBILIZATION: ANOTHER ANGLE TO LOOK AT THE MDGS?

11:00 AM 11:30 AMLocation: 5th Floor, Mario Laserna Building

Tea / Coffee Break

SPEAKERS

CHAIRPERSON

Boris Vujcic Member, GDN Board of Directors andDeputy Governor, Croatian National Bank, Croatia

Fabrizio Coricelli Professor of Economics, Universit de Paris 1 Panthon-Sorbonne, France

Iftekhar Hasan Cary L. Wellington Professor of Finance Director of the International Center for Financial Research, Rensselaer Polytechnic Institute, USA

Guillermo PerryRobert F. Kennedy Visiting Professor of Latin American StudiesHarvard Kennedy School, USA & Fedesarrollo, Colombia

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11:30 AM 1:00 PM

PARALLELS 3.1 3.3

PARALLEL 3.1 Japanese Award for Outstanding Research on Development (Themes 1, 2 & 3) Location: ML 603, 6th Floor, Mario Laserna Building Presentations by Finalists of the 2010 Global Development Awards Competition

The Japanese Award for Outstanding Research on Development carries cash prizes of US$35,000 plus travel expenses to our annual conference. An award of US$30,000 is given to an institution whose proposed research, on any one of the three research themes, has a high potential for excellence in research and clear policy implications for addressing development issues. One additional prize of US$5,000 is given to another institution to continue work in the chosen research area. Funding for the Award is generously provided by the Ministry of Finance, Government of Japan.

Patrick GuillaumontPresident, Fondation pour les Etudes et Recherches sur le Dveloppe-ment International (FERDI) Professor, Centre d'Etudes et de Recherches sur le Dveloppement Inter-national (CERDI), Universit dAuvergne, France

Bibek Ray Chaudhuri, Impact of External Capital Flows on MFI performanceAssistant Professor of EconomicsIndian Institute of Foreign Trade, India

Jeremaiah Opiniano, Research Associate, UST Research Cluster on Culture, Education and Social Issues (RCCESI) and Alvin P. Ang, Director, UST Research Cluster on Culture, Education and Social Issues (RCCESI), Remittance Investment Climate Analysis in Rural Hometowns (Ricart): piloting a tool to determine where overseas Filipinos from two rural hometowns can best invest their money

Petar Stankov, Financial Crises and Reversals in Financial DevelopmentSenior Assistant Professor of EconomicsUniversity of National and World Economy, Bulgaria

SPEAKERS

CHAIRPERSON


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PARALLEL 3.2 Japanese Award for the Most Innovative Development Project Location: ML 608, 6th Floor, Mario Laserna BuildingPresentations by Finalists of the 2010 Global Development Awards Competition

The Japanese Award for the Most Innovative Development Project carries cash prizes of US$35,000 plus travel expenses to our conference. An award of US $30,000 is given to an institution whose project embod-ies a fresh approach to an important development need and holds the greatest promise for benefiting the poor in developing and transition countries. The criteria include the degree of innovation and the potential for broad replication of the project in other countries. An additional prize of US $5,000 is given to another institution to support their ongo-ing development project. Funding for the Award is generously provided by the Ministry of Finance, Government of Japan.

Keiichi Tsunekawa Director of JICA Research Institute, Japan

Rajat Jay SehgalChief Executive Officer, Institute of Rural Research and Development, India and Sanjiv Chatrath, Chief Operating Officer, Institute of Rural Research and Development, India, Good Governance Now Edward Rwagasore, Camara Rwanda - Education HubChief Executive Officer, Camara Rwanda, Rwanda

Bhuwan Ribhu, Child Friendly Villages for the Elimination of Child Labour in RajasthanNational SecretaryAssociation for Voluntary Action, India

CHAIRPERSON

SPEAKERS

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PANELISTS

CHAIRPERSON

PARALLEL 3.3 Financial Crisis and the Role of Macro-Prudential PoliciesLocation: Mario Laserna Auditorium A, Mario Laserna BuildingOrganized by the World Bank Institute (WBI)

The traditional micro-prudential regulations proved inadequate during the recent global financial crisis. There is new thinking on (i) how to reform the global financial system and how to reduce the vulnerability of the system to adverse changes in macroeconomic and market conditions; and (ii) which macro prudential approaches to be introduced to comple-ment micro-prudential policies to deal with systemic risks, such as excessive leveraging by all types of firms and households coupled with liquidity mismatches during a boom followed by excessive risk-averseness and de-leveraging during busts.

There is also the issue of how best to deal with too big to fail institutions. The session will focus on the goals for macro prudential regulation and policies, the indicators and tools that need to be in place, and the remain-ing gaps in our understanding to deal with the next possible financial crisis.

Derek H. C. ChenEconomist, World Bank Institute, USA

Mario BergaraPresident, Central Bank of Uruguay, Uruguay

Asli Demirguc-KuntChief Economist of the Financial and Private Sector Network and Senior Research Manager of Finance and Private Sector, World Bank, USA

Erlend W. NierSenior Financial Sector Expert, International Monetary Fund, USA


Lunch


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1:00 PM 2:00 PMLocation: Rooms ML- 801 & ML 804, 8th Floor, Mario Laserna Building

Working Lunch Meetings of the Global Development Awards and Medals Competition 2010 Selection Committees 1 and 2 (by invitation only)

2:30 PM 4:30 PMLocation: Mario Laserna Auditorium B

PLENARY 4 INNOVATIVE SOURCES OF DEVELOPMENT FINANCE AND THE RISE OF THE NEW PHILANTHROPY (ROUNDTABLE)

Ann Harrison Member, GDN Board of Directors Director of Development Policy, Development Research Group, World Bank, USA & Professor of Agricultural and Resource Economics, Univer-sity of California, Berkeley, USA

Ernest Aryeetey Member, GDN Board of Directors and Vice Chancellor, University of Ghana, Ghana

Oliver BabsonBill & Melinda Gates Foundation, USA

Pierre Jacquet Chief EconomistAgence Franaise de Dveloppement, France

4.30 PM 5. 00 PMLocation: 5th Floor, Mario Laserna Building

Tea / Coffee Break

CHAIRPERSON

PANELISTS

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PARALLEL 4.1 Micro-credit and insurance: design and experimentationLocation: ML 603, 6th Floor, Mario Laserna BuildingOrganized by the European Development Research Network (EUDN)

5.00 PM 6.30 PM

PARALLELS 4.1 4.3

The three papers in this session offer different perspectives on the design of insurance and credit to examine constraints in the provision of credit and insurance in developing countries. The focus is on how the design of insurance and credit institutions might be improved to increase take-up and access.

The first paper examines data from a randomized experiment together with a structural model to study uptake of health insurance in Kenya. The second examines the role of heterogeneity in organizational forms to explain differences in risk sharing within insurance groups. The third examines how the design of microfinance lending might affect access to credit.

Francois Bourguignon RNP Head, EUDN and Director, Paris School of Economics, France

Jean-Marie Baland, Repayment incentives and the distribution of gains from group lending Professor, University of Namur, Belgium

Tessa Bold, Contract Design in Insurance ArrangementsAssistant Professor, Institute for International Economic Studies, Sweden

Andrew Zeitlin, Friends, fear, and finance: Buying health insurance in rural Kenya (with Stefan Dercon, Oxford and Jan Willem Gunning, VU University Amsterdam)Research Officer, Centre for the Study of African Economies, Dept of Economics, Oxford, UK Research Fellow in Applied Microeconomics, Lincoln College, Oxford, UK

CHAIRPERSON

SPEAKERS


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Xavier GinSenior Economist, World Bank, USA

DISCUSSANT

PARALLEL 4.2 Recent Trends and Challenges for Financial Development in Latin AmericaLocation: Mario Laserna Auditorium A, Mario Laserna BuildingJointly organized by the Latin America & Caribbean Region - World Bank & Corpo-racin Andina de Fomento (CAF)

LACs financial systems are at crucial juncture. Over the past two decades, most of LAC pursued highly regarded financial sector policies and established much improved macroeconomic and institutional envi-ronments. As a result, LACs financial systems appear to have become more resilient while continuing to gain in diversity. For all the apparent gains, however, many challenges remain, with respect to depth, access, international integration, and systemic stability.

This session addresses these issues by featuring relevant research that lies behind the forthcoming flagship publications on financial develop-ment in Latin America from the Andean Development Corporation (CAF) and the World Bank. The first half of this session focuses on the evolution of LACs financial systems over the past two decades, benchmarking them vis--vis other regions. It also addresses what are likely to be the key developmental and stability issues in the road ahead that need to be taken into account when designing the reform agenda for the financial sector.

The second half of this session evaluates the limited access to financial services by firms and households and highlights the role of microfinance as a response to the inability of traditional banking to efficiently attend excluded strata, and has potential to significantly affect the overall level of access to finance. New survey results on the relative importance of the informal sector in providing financial services to households are also discussed.

Guillermo PerryRobert F. Kennedy Visiting Professor of Latin American StudiesHarvard Kennedy School, USA & Fedesarrollo, Colombia

CHAIRPERSON

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Daniel OrtegaResearch Economist, Andean Development Corporation Corporacin Andina de Fomento & Fedesarrollo, Colombia

Sergio SchmuklerLead Economist, The World Bank, USA

Augusto de la TorreChief Economist for Latin American and the CaribbeanThe World Bank, USA

Leonardo VillarChief Economist, Andean Development CorporationCorporacin Andina de Fomento & Fedesarrollo, Colombia

SPEAKERS

PARALLEL 4.3 Research Shaping Policy Latin Americas ExperiencesLocation: ML 608, 6th Floor, Mario Laserna BuildingOrganized Session by GDNet

The new buzzword around the world is evidence-based policymaking. But how does this actually happen in practice? How receptive are policy-makers to using research evidence in both designing and implementing their policies? And how good and willing - are researchers at under-standing and engaging with policymaking processes? What is the role of strategic communication in influencing policy, and what are the results?

A panel of experts from Latin America will share their experiences both successes and failures to influence policy in a panel discussion in this parallel session. Moderated by a journalist, the session brings together the Executive Directors of three Latin American think tanks from Colom-bia, Ecuador and Chile to draw similarities and contrasts from their different approaches to influencing policy. They will make practical suggestions as to how to behave as a researcher if you want to be policy influential; and they will share two significant organizational decisions they have made to improve their influence.

Magued OsmanChairman, Egyptian Cabinet of Ministers, Information and Decision Support Center (IDSC), Egypt

CHAIRPERSON


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Laura ZommerCommunications DirectorCentro de Implementacin de Polticas Pblicas para la Equidad y el Crecimiento (CIPPEC), Argentina

Orazio BelletiniExecutive DirectorFoundation for Advance of Reforms and Opportunities (FARO), Ecuador Patricio MellerResearch DirectorCorporacin de Estudios para Latinoamrica (CIEPLAN), Chile Roberto SteinerExecutive DirectorFedesarrollo, Colombia

MODERATOR

PANELISTS

7.30 PM - 9.30 PMLocation: Saln Rojo, Hotel Tequendama (Red Room Tequendama Hotel)

2010 GLOBAL DEVELOPMENT AWARDS & MEDALS PRIZE DISTRIBUTION CEREMONY & DINNER (sponsored by the Finance Ministry)

Ernesto ZedilloChair, GDN Board of Directors andDirector, Yale Center for the Study of Globalization, USA

Juan Carlos Echeverry Finance Minister of Colombia

Gerardo della Paolera President, Global Development Network

Mara Claudia LacoturePresident, Proexport Colombia

CHAIRPERSON

WELCOME REMARKS

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DAY III - SATURDAY, JANUARY 15, 2011


PLENARY 5 DEVELOPMENT AID: THE EMERGING NEW LANDSCAPE

George Mavrotas Chief Economist, Global Development Network

Helen MilnerB. C. Forbes Professor of Politics and International Affairs, Princeton University and Director, Niehaus Center for Globalization and Gover-nance, Woodrow Wilson School, Princeton, USA

Patrick GuillaumontPresident, Fondation pour les Etudes et Recherches sur le Dveloppe-ment International (FERDI) Professor, Centre d'Etudes et de Recherches sur le Dveloppement International (CERDI), Universit dAuvergne, France

Ravi KanburMember, GDN Board of Directors andT.H. Lee Professor of World Affairs, Cornell University, USA

CHAIRPERSON

LEAD SPEAKER

DISCUSSANTS

11:00 AM 11:30 AM

Tea / Coffee Break

11:30 AM 1:00 PMPARALLELS 5.1 5.3

PARALLEL 5.1 Think Tanks in the Developing World Location: Mario Laserna Auditorium A, Mario Laserna BuildingJointly organized by Corporacin Andina de Fomento (CAF) & Fedesarrollo

SUNDAYJanuary 15th, 2011

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A think tank, being an independent non-profit research organization providing analysis and expertise in order to influence policymakers, faces two major challenges (i) how is independence maintained?; and (ii) what are the means to ensure influence among policymakers? It is easy to imagine tension arising between these two challenges, and there is evidence of this being a problem even in developed countries, particu-larly in the U.S. Put bluntly, if you want to be influential, you often have to sacrifice political independence.

While this tension might be exacerbated on account of concerns with financing, it can occur even in their absence. Based on their experience, leading particular think tanks, members of this special Parallel Session should address, among others, the following issues: How serious are the above-mentioned problems in developing countries? Does the consolida-tion of political parties help or hinder think tank influence and indepen-dence? Can regional or global networks mitigate these concerns? To what extent seeking influence through public opinion may mitigate this tension?

Enrique Garca Rodrguez President and CEO of Corporacin Andina de Fomento (CAF)

Ahmed Galal RNP Head and Managing DirectorEconomic Research Forum (ERF), Egypt

Oh-Seok Hyun President, Korea Development Institute, South Korea

Patricio MellerResearch DirectorCorporacin de Estudios Para Latino America (CIEPLAN), Chile

Roberto Steiner Director, Fedesarrollo, Colombia

Ernesto ZedilloChair, GDN Board of Directors andDirector, Yale Center for the Study of Globalization, USA

CHAIRPERSON

SPEAKERS

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PARALLEL 5.2 Diversification of Development Finance in AsiaLocation: ML 603, 6th Floor, Mario Laserna BuildingJointly organized by the East Asian Development Network (EADN) & GDN Japan

During the last three to four decades of late 20th century, foreign direct investment and development finance from the developed countries and various international organizations played important roles for economic development. However, the situation is gradually changing, as some countries have successfully developed their economies, graduated from a status of recipient countries and emerged as new donors, while most of the developed countries have been buffeted by one crisis after another.

Although the Monterrey Consensus is still adhered to by the interna-tional community, it may be difficult for the developed countries to increase aid amid difficulties caused by the financial crises. Therefore, it is important that alternative ways to fill development finance gaps of the developing countries be examined in order to achieve the goal of poverty reduction. The first issue is with regard to emerging donors. It is expected that the financial flows from the emerging donors will substi-tute for traditional development financing mechanisms.

However, this substitution is not without controversy because it is perceived that the policies and guiding principles of emerging donors are different from the traditional donors. The controversy arises because the perception is that emerging donors will undermine the regime of interna-tional cooperation and reduce aid effectiveness. One reason is that emerging donors tend to bypass the standard conditions that accompany aid packages, e.g. implementation of important economic reforms. This issue has to be studied more closely to determine whether the perception is correct. One can examine whether a cooperative and constructive rela-tionship can be developed among the two types of donors toward the same goal.

The second issue is on how to mobilize resources in the developing coun-tries in place of those from the developed countries. This question is particularly relevant in Asia where some countries have huge amount of savings. Private investments are gradually playing important roles in financing the development, whereas there are growing concerns over less regulated financial markets. The way to maximize development gains from private capital inflows, at the same time to tame its volatility, should be explored.


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The emerging phenomenon of micro-finance and recently, micro-insurance, which basically represents the response and strategy employed by the private sector and civil society in addressing the invest-ment and consumption constraints faced by informal enterprises and numerous micro-economic agents is an interesting issue. This phenom-enon rides largely on the back of public (government)-private coopera-tion with some incipient assistance from traditional donors.

The third issue is the development impact of overseas workers remit-tances. In some countries, like the Philippines, workers remittances from abroad are one of the major sources of the foreign currency reserves. It has also been reported that those remittances are the source of liquidity especially in the countryside that has enabled local residents to start micro-enterprises, improve their homes and even build new houses. But have overseas remittances really some positive develop-ment impacts? The transmigration of workers has immense impacts to both home and host countries.

To examine them may lead to significant implications for the policies of labor market liberalization or regulation. However, what is more impor-tant for this session will be to identify mechanisms to translate remit-tances into investment and make it a tool for development finance. The session aims at examining possible policy recommendations on diversifi-cation of development finance based on the issues above.

Mohamed AriffMember, GDN Board of Directors andExecutive Director, Malaysian Institute of Economic Research, Malaysia

Kaoru Hayashi, Post-crisis trends in ODAMember, GDN Board of Directors Professor, Bunkyo University andGDN Adviser to Japan International Cooperation Agency (JICA), Japan Gilberto M. Llanto, Microfinance and Micro-insurance: Myth and RealitySenior Research Fellow Philippines Institute of Development Studies (PIDS), The Philippines

CHAIRPERSON

SPEAKERS

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Jin Sato, How do Emerging Donors differ from Traditional Donors? -An Institutional Analysis of Foreign Aid in Cambodia Visiting Fellow, Princeton University, USAAssociate Professor, University of Tokyo, Japan

Guntur Sugiyarto, The role of remittances in promoting growth in AsiaEconomist, Asian Development Bank (ADB)

PARALLEL 5.3 Financing for Development: What Opportunities for Pacific Islands StatesLocation: ML 608, 6th Floor, Mario Laserna BuildingOrganized by the Oceania Development Network (ODN)

The world has changed dramatically since the 1970s when many Pacific Island countries gained independence and when new programmes and funding for development were agreed by independent Pacific Island governments and national and international donors. This was a new relationship, with new perspectives on social and economic development and new ways of providing financial assistance. It was a time of bilateral aid agreements, World Bank and Asian Development Bank loans, and a commitment to economic development.

While metropolitan country non-government organizations and churches continued to finance education and health-related develop-ment the major forms of development financing were bilateral and bank-ing loans. In the last 40 years, development theories, development prac-tice, development effectiveness and the forms of development assistance have changed. So has the global political and financial order. The over-use of resources, environmental destruction, continued rapid population growth, climate change, the volatility of the global financial market and the growing threat of global violence all play out on Pacific Island oppor-tunities for development.

How has development assistance adapted to these new realities? Has the aid relationship changed? Are there new ways of financing development? Are communities and Pacific Island government and non government organizations finding their own ways to finance the kinds of development they consider important? Is it time to become less risk averse and more creative in the search for development programmes that transform lives? How do we bring about a meeting of minds, based on a resolution of long standing disagreements, the recognition of shared interests across a wide range of issues, and the forging of common expectations for devel-opment? This session discusses recent changes in approaches to financ-ing for development in the Pacific and their impact on development.


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Pamela ThomasVisiting Fellow Research School of Pacific and Asian Studies, Australian National University, Australia

Priya Chattier, From Beijing to Doha: Financing for Gender Equality and Development: Evidence of Aid Effectiveness in the South PacificCoordinator & Lecturer for Gender StudiesUniversity of the South Pacific, Fiji

Anna Naemon, Managing Direct Budget Support in the PacificSenior ResearcherPacific Institute of Public Policy, Vanuatu

Baljeet Singh, The Microfinance Promise in Financial Inclusion: Evidence from and the Pacific RegionLecturer in EconomicsUniversity of the South Pacific, Fiji

Anita LataiHead of Humanities & History TeacherNational University of Samoa, Samoa

Milika WaqainabeteGeography LecturerInternational School Suva, Fiji

CHAIRPERSON

SPEAKERS

DISCUSSANTS


Lunch

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2.00 PM 3.30 PM

PARALLELS 6.1 6.3

PARALLEL 6.1 Intra-regional Capital Mobility Between and Within Africa and the Middle East Location: ML 603, 6th Floor, Mario Laserna Building Joint organized by the African Economic Research Consortium (AERC) & the Economic Research Forum (ERF)

Although Africa and the Middle East belong to the developing world, they are characterized by excess capital in some countries and scarce capital in others. The case for regional integration through capital mobility seems strong, at least on the grounds of potentially high returns to investment. However, intra-regional capital flows seem to be sub-optimal and excess capital, both official and private, tends to travel north and west rather than within the regions.

This session will explore the extent to which this observation is substan-tiated, explore the reasons why attempts to integrate through capital mobility have thus far been limited, and propose mechanisms to enhance intra-regional capital mobility for the benefits of both parties.

Ahmed Galal RNP Head and Managing DirectorEconomic Research

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