Author Archives: CGDev

The Right to a Personal Identity – Alan Gelb

What role can biometrics play in aiding development? My guest this week, senior fellow Alan Gelb, explains why new biometric identification technologies may be the key to radically expanding the social, political, and commercial opportunities for people in the developing world. Biometrics, he says, make it possible to fulfil for people everywhere the right to a unique, personal identity.

Alan explains that there are three principal ways in which people can identify themselves. The first can be something that you have, like a driver’s license or credit card. The second is something you know, like a PIN or a password; and the third is something that you are, like a finger print or iris scan. Biometric technology relies on this third method in order to uniquely authenticate individuals—and the costs are plummeting.

Although biometrics are often associated with law enforcement and security, especially in the post-9/11 world, two upcoming conferences, the Third Biometric Summit in Miami on March 3-6 and the Connect ID conference in Washington, D.C. later that month also will include discussions of a booming new market: providing individual identities to hundreds of millions of people in developing countries.

Biometrics “most rapid growth is in developing countries,” Alan tells me. “Increasingly the applications are moving from security and law enforcement to a variety of development programs.”

While having proof of identity is something many westerners may take for granted, Alan explains that the lack of identification is a major impediment for poor people in the developing world.

“There are probably about 750 million children, people under the age of 16, who do not have birth certificates, who have never been officially registered,” he says. “Some of these will catch up later through national ID programs but others will not.”

Not having identification prevents people from getting licenses of various types, opening bank accounts, registering property, and even from receiving services from the government. At a time when many people are concerned about governments hacking personal data, reading emails, and listening to phone calls, such unwilled obscurity might appeal to some people as an argument against the use of biometric identification.

While Alan acknowledges that such privacy concerns are legitimate, he argues they are not sufficient reason to discourage the use of biometrics to the benefit the poorest.

“It's very hard to argue that people at the bottom of the pyramid, and they almost always are at the bottom of the pyramid, should not have an ID on the grounds that ID may be abused,” he says. “Despite all the screams about ID, the ones who don't have it, who should be the most privileged by this argument, since they have the greatest privacy, are also the poorest. They have privacy only in the sense that nobody cares about them. They don't participate.”

Given the opportunity to receive identification, people line up. Alan argues that “there's a very strong lesson coming out of the comparative experience, which is that people will come forward, people are not afraid of technology, provided they think that it has something to offer them.”

Tune into the Wonkcast to hear more, including a discussion of the technical challenges in providing biometric identification at birth. And read Alan’s blog post in which he discusses some of the new trends likely to be hot topics at the upcoming biometric conferences in Miami and Washington.

My thanks to Kristina Wilson for recording and editing the Wonkcast and for a draft of this blog post.

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New Initiative to Support Priority Setting for Universal Health Coverage

This is a joint post with Kate McQueston and Jenny Ottenhoff. Universal health coverage (UHC) is now firmly on the global health agenda, and carries with it the ambitious goal of providing “access to key promotive, preventive, curative and rehabilitative health interventions for all at an affordable cost.” So where do we start?

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Let There Be Peace (and Power Africa) on Capitol Hill – Todd Moss and Tom Hart (ONE)

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Peace is breaking out on Capitol Hill? Can it be true? My guests this week, Tom Hart, the US executive director of the ONE Campaign, and Todd Moss, chief operating officer and senior fellow at CGD, discuss why President Obama’s Power Africa initiative and the complementary Royce-Engel bill have the potential to not only be a great success for Congress and the Obama administration, but also to radically transform the quality of life for the millions of Africans living without access to power.

Two thirds of people in Africa do not have any kind of modern electricity. For example, the average Ethiopian only has 52 kilowatt hours per year. While Todd had long been aware of these numbers, he says that they suddenly took on greater meaning for him when he went to buy a new refrigerator.

“I was in a store buying a new refrigerator and I noticed that my new fridge uses about 400 kilowatt-hours per year and I thought: this is crazy that my fridge would use more power than a person would.” Todd produced a chart that helped many people to better understand the extent of energy poverty in Africa.

Lack of modern energy in Africa touches every aspect of life from small entrepreneurs who are unable to grow their businesses to dramatic impacts on education and health.

“Not having electricity in Africa means kids can’t study after the sun goes down, so it impacts education, and something like 70-75% of schools don’t have electricity. It means moms cook on open fires inside their homes,” says Tom Hart. ONE has worked for years on the fight against AIDS, malaria, and other communicable diseases in Africa. Tom asserts that this has been crucially important work but adds: “More people die from the inhalation of toxic smoke fumes than from AIDS and malaria combined.”

Given these bleak figures, Tom and Todd say that they are encouraged by the Obama administration’s Power Africa initiative. They also agree, however, that complementary legislation, the Electrify Africa Act introduced by Congressmen Royce and Engel, includes adjustments that would set more ambitious targets and provide more efficient tools to meet them.

One such tweak involves modernizing policies governing the US Overseas Private Investment Corporation.

“They need multi-year authorization” and permission to retain a slice of their profits to increase staff levels and do more deals,” Todd explains. “They’re actually sitting on a lot of cash. They have paid profits back into the US treasury for thirty years, including about $250 million dollars last year. They’ve already got the capital and the systems in place for the investments. They just need the people to make that happen. I know that sounds very minor but that’s actually the main sticking point. “

Todd emphasizes that while limited staff is a significant obstacle to OPIC’s effectiveness in Africa, it is not the only obstacle. OPIC needs more flexibility to invest in fossil-fuel projects, including natural gas that Todd says are necessary to make rapid progress in bringing modern energy to Africa. The issue has become more pressing as several African countries are on the brink of oil and gas booms that will see them become energy exporters—even as their own populations lack for electricity.

“Given the current policies, OPIC would not be allowed to participate in natural gas power plants where Ghana would turn its own natural gas into electricity for its own people,” Todd explains. “We think that some flexibility for very poor countries—we’re not talking about letting OPIC invest in coal plants in Brazil—we’re talking about natural gas in poor African countries, they should be allowed a little extra flexibility,” he says.

I tell him that even a climate hawk like me finds such arguments persuasive. But what about Capitol Hill? Is this another good idea that will fall victim to a combative and stagnant Congress?

Tom is hopeful. “We have yet to have a bad meeting about [the Electrify Africa Act] on the Hill,” he says. “It has been introduced by leading Republicans and leading Democrats, and the House Foreign Affairs Committee, as well as the Africa subcommittees. It’s got 44 co-sponsors on both sides of the aisle. It’s quite tremendous when you see both Republicans and Democrats want to do something good and powerful, potentially transformative, that does not have a negative impact on the federal budget.”

Todd says he shares Tom’s optimism, viewing the Royce-Engel legislation as, “a very impressive and long-lasting legacy for the United States and for the Obama administration in sub-Saharan Africa which is after all, becoming increasingly important to us just at a time when we’re losing a lot of our influence in that region.”

Tune in to the full Wonkcast to hear from Tom what ONE volunteers will be doing over the next two weeks to help speed along this bipartisan, low-cost, and potentially transformative bill.

My thanks to Kristina Wilson for recording and editing the Wonkcast and for a draft of this blog post.

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Is ‘the Struggle’ the Baby or the Bathwater?

One of the first things we all learn as development rookies is that you cannot simply transplant institutions, systems or ideas from elsewhere. We are told that solutions have to be organic, locally-developed, country-owned and relevant to the context. But why and when is this true? Part of the answer is suggested in the writings of Matt Andrews, Michael Woolcock, Lant Pritchett, Justin Sandefur, me, and others (see the reading list at the bottom of this blog post). For at least some problems, there is something useful about the ‘the struggle’ – that is, the need for a community to identify its challenges and grapple iteratively with the solutions.

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Is Free Care Good for Health?

A recent article shows that removing fees for health care in rural Ghana has no impact on health. These results are strikingly similar to another recent study that found expanding the US Medicaid insurance program in Oregon also had no impact on physical health (my colleague Victoria Fan and I even wrote a similarly-titled blog about it here – Déjà vu!) Like insurance, removing user fees reduces the direct costs of health care. But reducing the direct costs of care generally hasn’t –on its own – improved health.

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Donors and a Data Revolution

The High Level Panel on the Post-2015 Development Agenda calls for a “data revolution,” a new international initiative to improve the quality and scope of statistics and information available to citizens and policymakers. Such an initiative is particularly needed in sub-Saharan Africa where core statistical products like censuses, vital registration systems and household/firm surveys are not yet routine or complete, and where data accuracy, timeliness, relevance and availability are perennial problems. (See our own work on this issue here, and a good summary of the problem here) There have been many “data revolution” meetings and conversations at all levels, and a number of new projects set to test post-2015 goals at country level from a data perspective

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Median Income as a Better Measure of Development Progress—Nancy Birdsall and Christian Meyer

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Development progress has traditionally been measured in terms of reductions in poverty and increases in per capita GDP, that is, average income as calculated by dividing total income by the total population. My guests on this week’s Global Prosperity Wonkcast, Nancy Birdsall and Christian Meyer, argue that median income—the income at the middle of a country’s income distribution—is a better measure. They join me to discuss their new working paper, The Median is the Message: A Good-Enough Measure of Material Well-Being and Shared Development Progress. During the interview we discuss why the median makes more sense (hint: something to do with inequality); why it hasn’t been used much in the past (hint: data availability); and how it could be incorporated into the post-2015 development framework.

I ask Nancy how she became interested in the median. “Almost 10 years ago, I did a paper where I (initially) defined the middle class as the group around the median, and that’s how I discovered just how low the median was. I realized that definition of the middle class didn’t make sense,” Nancy explains. “We called it the ‘middle income group’ because it really wasn’t middle class by Western standards.”

In later works, Nancy identified (as opposed to “defining”) the middle class as those who have the equivalent of at least $10 per day per capita. Last year, in a paper on Latin America authored with Christian and Nora Lustig , she identified a group she calls the “strugglers” – people with daily incomes between $4 and $10 who are well above the international poverty line but still vulnerable to falling back into poverty.

This research, she says, caused her to realize that although there are millions of people who’ve escaped extreme poverty, half of the population of the developing world is still at $3 per day or less (about the median for all people in developing countries today), and $3 per day is still very poor.

Christian explains that unlike per capita income, median income reflects differing levels of inequality. If there are a few very rich people and many poor people, average income will be much higher than the median income. If, on the other hand, income distribution is relatively less unequal, the difference between the mean and the median will be smaller.

“The median provides a distribution-aware measure,” Christian explains. “Unlike the average, it’s aware of the underlying distribution of wealth in a country, and using such a measure provides a simple sense of income inequality.”

Nancy illustrates this with a comparison of Cameroon and China. Both have median daily consumption expenditure of about $3.25 per capita,” Nancy says, even though China is far richer measured in terms of average per capita GDP — about 3.5 times richer than Cameroon. Right away, you know that income inequality is higher in China, and that is in fact the case, with higher incomes in the coastal cities and much lower incomes in the rural interior.

Inequality hasn’t only been rising in China . I note that Figure 11 from their paper shows the growing divergence in the US between average income and median income since the 1980s. I suggest that as the two measures have diverged, interest in the median as a measure of social wellbeing seem to have grown.

Nancy confirms that rising inequality is part of what is driving this interest. Another factor, she says, is increased data availability. “What’s changed over the last 10 years is the increase in household survey data in developing countries,” Nancy notes. “Now we have increasing access to the entire distribution of household consumption expenditures or income, which makes estimating the median possible.”

We also discuss the World Bank’s new shared prosperity indicator, which tracks the income growth of the bottom 40 percent of the population, and why the median is likely to be a better overall measure of development progress (listen to the Wonkcast for more on this!).

I end by asking Nancy how she would propose incorporating median income into the post-2015 development framework. She proposes that each country should set its own target for an increase in the median income between now and 2030. “Because it’s a distribution-aware measure, it allows countries to set goals without facing the kind of pushback around thinking of inequality as an outcome, when everyone wants to focus on equality of opportunity,” she says.

My thanks to Sophia Bernazzani for a draft of this blog post and to Kristina Wilson for recording and editing the Wonkcast.

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Piloting COD Aid: Results Are Coming into Focus

This is a joint post with Rita Perakis. It would be strange to try learning how to play music without listening to musicians. Similarly, learning about results-based aid programs requires listening to people who design and implement them. That is just what we did last week in a set of workshops about implementing programs that pay for results – programs which apply some or all of the principles that we’ve discussed here at the Center as Cash on Delivery Aid. As a result of discussing real experiences, we discovered that some of the challenges are quite different than we had anticipated while a number of common concerns have simply failed to materialize

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Natural Gas vs Renewables for OPIC: What’s the Tradeoff?

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This is a joint post with Ben Leo. Of the many outcomes in the FY2014 Omnibus Appropriations legislation, one that stood out was buried in section 7081. This provision now allows the Overseas Private Investment Corporation (OPIC) to invest in fossil fuel power projects in IDA and IDA-blend countries. In other words, OPIC’s carbon cap has been lifted at least until the end of September. The debate now shifts to what OPIC will be able to do over the medium- to long-term to help close the huge energy access gap

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Why Ending Poverty Requires Ending Everyday Violence Against the Poor

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When middle class households opt out en masse of public schools — as in India and Brazil and the inner cities of USA— it’s bad news for the children of the poor majority. That’s now a familiar and important argument for radical new thinking about school systems. But it’s even worse for poor people when the middle class and rich give up on basic public security, protecting themselves instead with private guards, gated communities and bullet-proof cars. Result: poor people are left exposed to everyday criminal violence that is “as much a part of what it means to be poor as being hungry, sick, homeless or jobless” — says Gary Haugen of the International Justice Mission in this Washington Post op ed. It’s rare for me to pump a non-CGD book on our CGD website

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DIBs: A New Kind of Development Partnership

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Government, business, and civil society leaders are exploring how they can use Development Impact Bonds to catalyze development, according to UK Secretary of State for International Development Justine Greening. The Secretary of State is one of three high-level co-chairs of the Global Partnership for Effective Development Cooperation which brings together governments of 160 countries, multilaterals, private sector companies, and civil society organizations with the aim of identifying ways to get better development results and holding each other accountable. Development Impact Bonds are one example of how governments can form “partnerships with business for effective development”, the subject of Justine Greening’s post and her recent comments at a World Economic Forum session in Davos. Under DIBs, governments identify social priorities and objectives, but private money and management come in to make service delivery more flexible and more efficient.

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It’s Time to Learn More about How Poor Families Use Migration

Tim Ogden and I want a new research agenda for migration and remittances. Development policymakers have gotten excited about remittances, the cash that migrants send to developing countries. In large part this is because remittances are huge—about triple the size of foreign aid flows. That’s a big opportunity for development. But much of the research on remittances focuses on why they are primarily spent on consumption, and how governments and NGOs can get people to invest remittances

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SOTU 2014: The Developmentista Edition

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This is a joint post with Erin Collinson. President Obama will deliver his 2014 State of the Union speech Tuesday, January 28. We polled CGD experts to find out what they’re hoping to hear when the president addresses Congress and the nation. Check out their oratorical contributions below and read about the development-related decisions and policies they would like to emerge in support of the rhetoric.

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The Upside of Down – Charles Kenny

What should the US and Europe do about the relative decline of their global influence? My guest this week, CGD senior fellow Charles Kenny, has a surprising answer in his new book, The Upside of Down: Why the Rise of the Rest Is Good for the West. His take? Embrace it.

“The opportunities of a wealthier world will also be far easier to grasp if the West stops trying to reverse the inevitable flow of its relative decline and moves to channel it instead,” he says.

“Rather than focusing on retaining or regaining top nation status on anachronistic measures of influence like aggregate output, policymakers should maximize America’s and Europe’s benefits from a richer, healthier, more educated, and safer world.”

Charles is an inveterate optimist whose previous book was titled Getting Better: Why Global Development Is Succeeding–And How We Can Improve the World Even More. In the Upside of Down he addresses fears that the rapid rise of the developing world will diminish not only the influence of the US and Europe but also the quality of life.

To the contrary, he argues, life can get better even as national status as measured in aggregate GDP is eclipsed by rapid growth in China, India, Brazil and elsewhere. Charles background—his mother is American, his father British—leads him to see a wider lesson in the UK experience.

“The US will lose some global influence, as China’s GPD overtakes it, maybe as India’s GDP overtakes it; but Britain has much less global influence today than it had at the height of the British Empire and it’s also just a much nicer place to live.”

The key to adjusting gracefully to relative decline lies in what might be called good global citizenship: pursuing policies that are fair to people in the developing world and ultimately better for people in the wealthy countries, too.

Many of Charles’s examples concern US policies, though he notes that the same approach applies to Europe as well.

Too often, he says, narrow, short term interests predominate, while a broader, longer-term perspective would support policies that are good for Americans and for everybody else, especially in a world where the US is no longer No. 1. Among the topics we cover: US migration policy, intellectual property rights, and tobacco exports.

In the second half of the Wonkcast we move onto a discussion of climate change. Charles is quick to acknowledge that there are legitimate fears that the “rise of the rest” that he celebrates throughout his new book “may toast the planet.”

But here, too, he sees reasons for hope: developing countries, he says, are moving more rapidly than the West to address climate change.

“The largest producer and consumer of solar in the world is China,” Charles notes. “The percentage of people willing to give up money to help the environment is twice that of the US. There is reason to believe that developing countries are taking this stuff more seriously than we do now.”

We end with a discussion of the role of money in politics in the US—a key element in my view in the predominance of the short-term, narrow thinking that too often drives US policies at home and towards the rest of the world. Charles manages to persuade me that this, too, is not entirely hopeless. Our conversation is just the thing you want to listen to if you are feeling discouraged about the state of the world.

My thanks to Kristina Wilson for recording and editing the Wonkcast and for a first draft of this blog post.

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