Economy and Finance

The global economy is rapidly changing. Economic power is increasingly shifting from North America and Europe to China, India, Brazil and other emerging economies. At the same time, poverty remains endemic in many parts of the developing world. Global challenges such as climate change and resource scarcity are shaping the way countries manage their own economies and interact with others.

Accountant counting a bundle of 100 Yuan bank notes.Credit: Mark Henley / Panos

The impacts of the financial crisis are being felt around the world, placing global financial systems under increased scrutiny and raising questions about regulation and reform.

Sustainable and equitable economic growth is more important than ever. Achieving this requires countries to reach out to broader markets through trade, and to create the right domestic environment to stimulate investment and innovation. They also need to ensure that external relationships contribute as much as possible to domestic growth and development, and that the benefits of development are shared fairly.

IDS works on a range of issues concerning economy and finance, including:

  • Trade and growth – we are analysing trends in global trade and regionalisation of the global economy using quantitative analysis and economic modelling.
  • Sustainability and the green economy – we are seeking to understand how investment in low-carbon technologies can help countries grow sustainably, and how this investment could be increased.
  • Finance and infrastructure – we are examining the impact of Development Finance Institutions support for Private Participation in Infrastructure on economic growth and poverty reduction.
  • Private capital flows – we are mapping changes in capital flows, and linking this to development impacts.
  • Climate change finance – we are exploring how to mobilise and distribute finance that helps countries mitigate and adapt to climate change.
  • Environmental taxation – we are exploring the links between environmental taxation and international development outcomes.
  • Business innovation and branding – we are examining how businesses in China and Brazil are growing their innovation and branding capabilities.

Assessing the Tobin Tax

The current financial crisis has stirred up an old debate about whether it might make sense to impose a Tobin Tax, either on foreign exchange transactions or on all financial transactions. More details

BRICS Economic Engagement Footprint Study

This project investigated the nature of economic relations between the BRICS and Africa, in order to quantify the development footprint, focusing on various elements such as trade, investment. finance, ODA and migration. The current phase aims to look at development finance and the role of BRICS development banks. More details

Business from the BRICS

The Rising Powers in International Development Programme is looking at the growing role of business from the BRICS countries in the field of international development cooperation. More details

Codes and Standards and Development Finance

Using case studies of Brazil and India, this work looked at the impact on development finance of compliance with international codes and standards. More details

Evidence and Lessons from Latin America (ELLA)

Evidence and Lessons from Latin America' (ELLA) is a knowledge sharing and learning programme, that seeks to improve knowledge of Latin America's development among African and Asian policymakers, practitioners and researchers - on selected economic, environmental and governance issues. More details

Handbook of Financialization

Financialization has become the go-to term for scholarship that studies the vastly expanded role of finance in contemporary politics, economy and society. The goal of this handbook is to provide a comprehensive overview of the scholarship on financialization as it stands today, almost twenty years after the concept was first embraced by social scientists More details

International Architecture for Economic Shock Financing

This project examined the international architecture of economic shock financing and provided some recommendations for a better shock financing architecture. More details

Linking Participation and Economic Advancement

In this project, IDS will draw upon and expand its rich experience at the forefront of thinking about participation in development, and our emerging work at the intersection of participation and markets. We will co-create along with the Economic Advancement Program (EAP) at the Open Society Foundations (OSF), a deeper understanding of participation in economic advancement in general, as well as how EAP can bring participatory approaches into its own practice. More details

Masculinities and Transition

The project will explore the experiences of men and shifting constructions of masculinities in current ‘transition countries’ More details

Political Economy of Low Carbon Investment in China and India

This project investigates whether and how coalitions of public, private and civic actors influence low carbon investment. More details

Research on the Poverty Impact of Market and Enabling Business Environment Programmes in Kenya

To what extent does private sector development work in Kenya contribute to a reduction in poverty and inequality? This review aims to assess the evidence base for DFID Kenya’s Wealth Creation Pillar programming. More details

UNU-WIDER Symposium on Taxation & Revenue Mobilisation in Developing Countries consultancy

Bruno Martorano will be conducting research on the topic of ‘Tax Changes and Inequality in Latin America, 1990-2010’ More details

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Front cover of report Market systems development in the
cities of rapidly urbanising countries

Market Systems Development in the Cities of Rapidly Urbanising Countries

The aim of this paper is to offer guidelines for those in the market systems community interested in working in urban settings, by exploring the key features that makes cities unique and the implications these features have for programmes using a market systems approach. More details

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The Political Economy of Economic Empowerment: Bringing Politics and Society Back In

IDS Working Paper 484 (2017)

Economic empowerment programmes designed to mitigate inequalities are increasingly becoming an important part of the portfolio for governments in low-income countries. More details

Non-IDS publication

Norms, Power, and the Socially Embedded Realities of Market Taxation in Northern Ghana

This article provides a ground-level view of market taxation in two local government areas in Ghana’s relatively disadvantaged northern region. More details

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A Narrative Analysis of the Political Economy Shaping Policy on Child Undernutrition in India

Development and Change 48.2 (2017)

This article examines two narratives on the subject of child undernutrition in India espoused by competing sides of the policy elite. It argues that undertaking narrative policy analysis in a structured fashion helps to elucidate a clearer sense of the underlying positions within this important area of development discourse. More details

IDS publications on international development research

Book Review: Isabelle Guérin, Marc Labie and Jean-Michel Servet (2015): The Crises of Microcredit

Journal of International Development 29.2 (2017)

An edited book by Isabelle Guérin, Marc Labie and Jean-Michel Servet shines the spotlight on numerous smaller crises and collapses that have plagued microcredit in many countries over the past two decades, some of which went unnoticed beyond narrow expert circles. More details

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Evaluation and Impact Investing: A Review of Methodologies to Assess Social Impact

IDS Evidence Report 222 (2017)

This report highlights the paradox within impact investing: the prioritisation of ‘social impact’ without prioritising ‘impact evidence’. The growth of metrics, ratings and certification-based approaches has sought to address this gap but this only goes so far, and there is a need for a more evaluative approach to assessing impact. More details

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The political economy of state-led transformations in pro-poor low carbon energy: A case study of solar PV in Kenya

STEPS Working Paper 91 (2017)

International efforts to achieve goals such as universal energy access and climate change mitigation are expected to stimulate billions of dollars of private financial flows to developing countries for clean (energy) technology transfer investments. More details

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The Influence of Proximity to Market on Bean Producer Prices in Nicaragua

Agricultural Economics 48.4 (2017)

Transport costs are an important determinant of smallholder welfare in developing countries. In particular, transport costs influence the prices that smallholders receive for their produce. We propose a simple way of quantifying this influence. More details

Non-IDS publication

Opinion: Urban Resilience Efforts Must Consider Social and Political Forces

Environmental disasters, ranging from catastrophic floods to extreme temperatures, have caused more than 30,000 deaths per year and more than US$ 250–300 billion a year in economic losses, globally, between 1995 and 2015. More details

Social, Technological and Environmental Pathways to Sustainability Centre logo

The Political Economy for Low-carbon Energy Transition in China: Towards a New Policy Paradigm?

New Political Economy (2017)

China has become the leading country to develop wind and solar energy industries. By presenting the institutional arrangement and interest constellations of China’s regulatory system of renewable energy sectors, this paper argues that the reasons for China’s swift expansion of wind and solar energy investment go beyond the notion of a state-led model. More details

IDS publications on international development research

Political Economy Analysis of the Binding Constraints to Renewable Energy Investment in Ghana

The main aim of this report is to unravel the complexity as well as identify the alignments of interests or alliances surrounding the advancement or blockage of the implementation of very fundamental policies, initiatives and strategies for RE investment and development in Ghana. More details

Non-IDS publication

Adapting To Risk And Perpetuating Poverty: Household’s Strategies For Managing Flood Risk And Water Scarcity In Mexico City

Adaptation is typically conceived uniquely in positive terms, however for some populations, investments in risk management can entail significant tradeoffs. More details

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Gauging Demand for Evidence and Accountability in Impact Investing by using Twitter Social Network Analysis: A Methodology

IDS Evidence Report 213 (2016)

This report explains the methodology used to analyse the demand for evidence and accountability within the impact investment market. Social network analysis, qualitative interviews and ego network analysis were used to explore actors within this market (or system), drawing on data from Twitter to consider connections, influence and conversations about social impact. More details

Partnerships, Planning and Policy Windows: How to Engage Non-academics with International Development Research

Many international development research projects aim to go far beyond influencing academic debate - they also seek to build relationships and networks, influence attitudes and behaviours, and inform policy and practice. This Learning Guide seeks to draw out some of the key lessons on successful approaches to engaging non-academic audiences for impactful research. More details

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Towards Greater Effectiveness and Accountability in Impact Investing

IDS Policy Briefing 126 (2016)

Impact investing – investing for social and environmental returns alongside financial returns – is a growing phenomenon in financial markets. However, concerns exist regarding the demand for robust impact evidence and accountability for impact claims when compared to a public sector aid model. More details

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Framing and Reframing Sustainable Bioenergy Pathways: The Case of Emilia Romagna

STEPS working paper 88 (2016)

This paper addresses the case of bioenergy development in Emilia Romagna, using and building on a ‘pathways to sustainability’ approach (Leach et al. 2010). More details

Non-IDS publication

A Price-Based Royalty Tax?

Discussing the merits of a price-based royalty, a royalty for which the rate varies with the product price, as a fiscal instrument for taxing extractive industries. More details

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Grassroots Innovation Movements

Innovation is increasingly invoked by policy elites and business leaders as vital for tackling global challenges like sustainable development. More details

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From Growth to Green Investment Diagnostics

IDS Working Paper 472 (2016)

The need to shift from fossil fuels to renewable energy systems is now broadly accepted, and our understanding of how different policy mechanisms can support this process is growing. More details

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Can China’s Bold New Plans Make the Difference in Pakistan?

IDS Policy Briefing 121 (2016)

Ever since the 1955 Bandung Conference of Afro-Asian states, China has been active in civil engineering projects around the world, especially in Africa, as a sign of its commitment to the world emerging from colonialism. More details