International Public Goods: Incentives, Measurement, and Financing PDF
Preview International Public Goods: Incentives, Measurement, and Financing
INTERNATIONAL PUBLIC GOODS INTERNATIONAL PUBLIC GOODS Incentives, Measurement, and Financing Edited by Marco Ferroni and Ashoka Mody SPRINGER SCIENCE+BUSINESS MEDIA, LLC THE WORLD BANK Washington, De Library of Congress Cataloging-in-Publication Data A C. L P. Catalogue record for this book is available from the Library of Congress ISBN 978-1-4613-5334-8 ISBN 978-1-4615-0979-0 (eBook) DOI 10.1007/978-1-4615-0979-0 Copyright © 2002 Springer Science+Business Media New York Originally published by Kluwer Academic Publishers in 2002 Softcover reprint ofthe hardcover Ist edition 2002 AH rights reserved. No part of this work may be reproduced, stored in a retrieval system, or trausmitted in auy form or by auy meaus, electronic, mechauical, photocopying, microfilm ing, recording, or otherwise, without written permission from the Publisher, with the exception of any material supplied specificaHy for the purpose of being entered aud executed on a computer system, for exclusive use by the purchaser of the work. Printed on acid-free paper. CONTENTS Preface andAcknowledgments vii Contributors ix 1. Global Incentivesfor International Public Goods: Introduction and Overview 1 Marco FerroniandAshokaMody 2. Defining InternationalPublic Goods: Conceptual Issues 31 OliverMorrissey, DirkWillem te Velde, andAdrianHewitt 3. Supplying InternationalPublic Goods: How NationsCan Cooperate 47 ScottBarrett 4. Financing InternationalPublic Goods 81 ToddSandler 5. AllocatingAid toInternationalPublic Goods 119 DirkWillem te Velde, OliverMorrissey, andAdrianHewitt 6. Regional Public Goods in Official DevelopmentAssistance 157 Marco Ferroni Index 187 PREFACE AND ACKNOWLEDGMENTS Many development problems transcend national borders and are regional, or even global, in character. The recognition of these international challenges, which range from the transmission ofdisease across borders to the spread of global financial instability, has led to a new urgency to contain and resolve them. Becausenoone country acting on its own can typically deal with such challenges, international coordination is required, but is typically difficult to achieve.TheWorldBank'sGlobalDevelopmentFinance2001: BuildingCoa litionsfor Effective Development Finance, published inApril 2001, discusses thisevolvingconcern.Thatreportoffersastrategicandoperationalframework for supplying internationalpublicgoods andmobilizing therequiredfinancial resources.Thereportalsopresentsafirstsetofestimatesontheextentofinter nationalresourcetransfersforthesegoods.Anumberofpaperswerewrittenas background to the report. The purpose of this book is to briefly present the principal conclusions from GlobalDevelopment Finance 2001, butmainly to makethebackgroundpapersavailabletoanacademicandpolicyaudience.We expectthattheanalyticalandempiricalcontributionsofthisresearchwouldbe ofwide interest. This books marks the completion ofa process initiated by a workshop on GlobalPublicPoliciesandProgramheldonJuly 11-12, 2000, inWashington, D.C. to outlinethe analytical and strategic agendafor thedelivery ofinterna tionalpublicgoods. Severalleadingacademicsandseniorpolicymakersjoined in the deliberations at the workshop, organizedjointly by the United Nations DevelopmentProgrammeandtheWorldBank.Formakingthatworkshoppos sibleandforthepublicationofitsproceedings,theauthorsaregratefultoChris topherGerardandRobertPicciottooftheWorldBank'sOperationsEvaluation Department.Throughout,theSwissAgencyforDevelopmentandCooperation providedfinancial support. Theeditors and authors aregrateful to theagency, viii PrefaceandAcknowledgments and especially to Walter Hofer, for the support and encouragement offered. However, the views expressed in the book are those of the authors and not necessarilythoseoftheWorldBankortheSwissAgencyforDevelopmentand Cooperation. Theeditorsarealsogratefultomanywhohavegraciouslysharedtheirideas and their time in reviewing various drafts. Nancy Birdsall, Ravi Kanbur, and BruceRoss-Larson were with us throughouttheproject. RobertDevlin, Ishac Diwan, Nagy Hanna, Paul Hubbard, Gregory Ingram, Paul Isenman, Motoo Kusakabe, Geoffrey Lamb, Uma Lele, and Stephen Quick helped atdifferent stages.WewouldespeciallyliketoacknowledgethecontributionofAristomene Varoudakis,whowasourcoauthorfortheGlobalDevelopmentFinancereport. Finally, we would like to thank Alice Faintich for her excellent editing and attentiontodetail,KathyRettingerforproofreadingthemanuscript,andCindy Stockfor typesetting it. CONTRIBUTORS ScottBarrett ScottBarrettisprofessorofenvironmentaleconomicsandinternationalpoliti cal economy at the Paul H. Nitze School ofAdvanced International Studies, JohnsHopkinsUniversity.HepreviouslytaughtattheLondonBusinessSchool. ProfessorBarretthas written anumberofpapers on international cooperation and treaty negotiation,especially intheareaoftheenvironment, for which he wasawardedtheErikKempeprize.HereceivedaPh.D. ineconomicsfromthe London School ofEconomics. Hecanbereached at [email protected]. MarcoFerroni Throughouthiscareerin internationaldevelopment, MarcoFerroni has held posts in multilateral and bilateral agencies. He recently joined the Office of Evaluation and Oversightofthe Inter-American Development Bank. Imme diately prior to this, he was senior advisor in the World Bank's Vice Presi dency for Resource Mobilization and Cofinancing. Dr. Ferroni has been a memberofthe boards ofexecutivedirectorsofthe Inter-American Develop ment Bank and the Inter-American Investment Corporation, and has occu pied managerial positions in the Swiss ministries of Public Economy and Foreign Affairs, working in the area of technical and financial cooperation withdevelopingcountriesandemergingmarketeconomies. Heheldagradu ateteachingappointmentattheSwissFederalInstituteofTechnologyinZurich in the 1990s. Dr. Ferroni has published articles and professional papers on foreign aid and development finance, international public goods, public ex penditurereform, policy reformand socialprotection, and the inter-relation ship betweentrade and macroeconomic regimes and agricultural growth. He received a Ph.D. in agricultural economics from Cornell University. He can be reached at [email protected]. x Contributors Adrian Hewitt Adrian Hewitt was one ofthe original associates ofRobert Cassen on Does AidWork? (OxfordUniversity Press, Oxford, U.K., 1984,revised 1994)and wrote Crisis or Transition in Foreign Aid(Overseas Development Institute [ODI],London, 1994,withtheOverseasDevelopmentCouncil,Washington, D.C., and the North-South Institute, Ottawa). In 1984 he founded the All PartyParliamentaryGrouponOverseasDevelopmentintheBritishHouseof Commons, with which he wrote Africa's Multilateral Debt: A Modest Pro posal (ODI, London, 1994), a tract that preceded the agitation for and the realizationofthepresentheavilyindebtedpoorcountriesarrangements.Edu cated at Oxford University and the School ofOriental and African Studies, London, he worked in Madagascar and Malawi before joining the ODI in London, whereheis now seniorresearchfellow anddirectoroftheODIFel lowship Scheme. Mr. Hewitt is co-editorofDevelopment Policy Review and a board member of Third World Quarterly and the Paris-based economics research institute DIAL. Recent publications include Economic Crisis in DevelopingCountries: NewPerspectivesonCommodities, TradeandFinance (with Machiko Nissanke, Pinter Publishers, London, 1993), Europe's Pre ferred Partners: The Lome Countries in World Trade (with Michael Daven port, ODI,London, 1995),and WorldCommodity Prices: StillaProblemfor Developing Countries? (with Sheila Page, ODI, London, 2001). He can be reached at [email protected]. AshokaMody Ashoka Mody is a division chief in the International Monetary Fund's Re search Department. Most recently he was at the World Bank, where he was managerandprincipalauthoroftheBank'sGlobalDevelopmentFinance2001. He has previously worked at AT&T's Bell Laboratories and been a visiting professorofpublicpolicyandmanagementattheUniversityofPennsylvania's Wharton School. He has written on technical change through foreign direct investment and international trade, and more recently on international finan cialmarkets andcapitalflows todevelopingcountries. His writings havebeen publishedinacademicjournalsandforpolicyaudiences.Hecanbereachedat [email protected]. Contributors xi OliverMorrissey OliverMorrissey isdirectoroftheCentreforResearchinEconomicDevelop mentandInternationalTradeandreaderindevelopmenteconomicsattheSchool ofEconomics,UniversityofNottingham, wherehehasbeen since 1989.Heis also a researchfellow in internationaleconomics with the OverseasDevelop ment Institute in London, and has considerable experience in aid and trade policy analysis, working mostly in East Africa. He has published numerous articlesinacademicjournals,notablyonaideffectiveness,tradepolicyreform, and structural adjustment, butalsoon public choice aspects ofpublic finance. HeobtainedhisPh.D. ineconomicsfromtheUniversityofBath,UnitedKing dom. Hecan bereached [email protected]. ToddSandler ToddSandleristheRobertR. andKatherynA. DocksonChairofInternational Relations andEconomics atthe University ofSouthernCalifornia, LosAnge les. He was previously Distinguished Professor of Economics and Political Science at Iowa State University. His writings address such topics as public goodsandexternalities,defenseandpeaceeconomics,environmentaleconom ics,andforeignassistance.HeauthoredEconomicConceptsfortheSocialSci ences (Cambridge University Press, Cambridge, U.K., forthcoming), Global Challenges: An Approach to Environmental, Political, and Economic Prob lems (Cambridge University Press, Cambridge, u.K., 1997), and Collective Action: Theory andApplications (University ofMichigan Press, Ann Arbor, 1992). He co-authored The Theory ofExternalities, Public Goods, and Club Goods(CambridgeUniversityPress,Cambridge,U.K,2ndedition, 1996).Pro fessor Sandler has worked for numerous organizations, including the United NationsDevelopmentProgramme,theOverseasDevelopmentCouncil,theU.S. Department ofDefense, and the World Bank. In 1998-2000he was a NATO Fellow. Hecan bereached [email protected]. DirkWillemteVelde DirkWillemteVelde is a research fellow at the Overseas DevelopmentInsti tute,wherehismaininterestsconcerninternationalpublicgoodsandtheimpact xii Contributors ofandpoliciestowardforeign directinvestment. He waspreviouslyaresearch officer at the National Institute ofEconomic and Social Research and a re searcherbasedattheCPB NetherlandsBureauforEconomic PolicyAnalysis. He has published a number of articles and book chapters on foreign direct investment,trade,development,labormarkets.andtheenvironment.He·canbe reached [email protected].
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