Welcome to the Growth Blog

The Growth Blog is a forum for you - the policy maker, the academic, the student, and the interested citizen of the world - to agree, disagree, or simply to engage current practitioners on policies and issues critical to development. This platform was inspired by the series of meetings that the Commission on Growth and Development held around the world over the course of the last two years. Of the many lessons that emerged in the deliberations, the one that stands out is that inclusive growth requires inclusive thinking, and inclusive discussion.

 

Month of February, 2009

The Administration’s Homeowner Affordability and Stability Plan: Some Questions

Submitted by Dwight Jaffee on Mon, 02/23/2009 - 18:29.

  

Introduction
 
The Administration’s new plan for stabilizing the mortgage and housing markets consists of three basic components:
1)   To encourage loan modifications for mortgages on the brink of foreclosure.
2)   To expand the mortgage refinancing option for loans that are not otherwise eligible.
3)   To lower mortgage interest rates through increase purchases by Fannie Mae and  Freddie Mac (hereafter F&F).

The Impact of the Current Financial Crisis on the Developing Countries

Submitted by Dwight Venner on Wed, 02/18/2009 - 15:25.

The impact of the current financial crisis on the developing countries and the slide of the major industrial countries into recession pose several interesting questions for the international community and the growth commission which released its report in 2008.

 

Two of these questions/issues will be singled out for attention in this brief note.  Firstly, the Commission predicated its findings on an open and expanding global economy in which developing countries could import ideas, technology and know how from the rest of the world, and, secondly, the importance of leadership, effective government and experimental policy making to facilitate poor countries in achieving high and sustainable growth rates over an extended period of time.

The Great Stability is over. What About Low Income Convergence?

Submitted by Homi Kharas on Mon, 02/16/2009 - 12:43.

Not so long ago, it was fashionable to think that the business cycle had been virtually abolished.  Economists came to call this “the great stability” and for a decade or more, it looked as if realized growth outcomes could be taken as good proxies for long-term structural growth trends.  The excitement for development economists was that this time many developing countries were growing significantly faster than rich countries.  It seemed that the secrets of global convergence—which is what the Growth Report tries to tease out—had been discovered by a very large number of countries, including many African countries.

 

Getting US Growth Back On Track: Can It Be Done?

Submitted by Simon Johnson on Sun, 02/08/2009 - 19:53.

There comes a time in every economic crisis or, more specifically, in every struggle to recover from a crisis, when someone steps up to the podium to promise the policies that - they say - will deliver you back to growth.  The person has political support, a strong track record, and every incentive to enter the history books.  But one nagging question remains:

Can this person, your new economic strategist, really break with the vested elites that got you into this much trouble?  The form of these vested interests, of course, varies substantially across situations, but they are always still strong, despite the downward spiral which they did so much to bring about.