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

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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Book cover for Growth is dead, long live growth! The Quality of Economic Growth and Why it Matters

Growth is Dead, Long Live Growth: The Quality of Economic Growth and Why it Matters

As the signs of negative impact of global climate change are becoming evident, and especially in the aftermath of the global economic turndown, societies had a choice --- either reframe their definition of growth, or try to pursue it, growth as we have known it for many decades. More details

IDS publications on international development research

The Market Response to Corporate Scandals Involving CEOs

Applied Economics 47.17 (2015)

This article examines corporate scandals of both a financial and non-financial nature between 1993 and 2011 which is expressly linked to a firm’s CEO. Findings suggest that in the short run, investors react adversely to such events and that recalcitrant CEOs end up costing their shareholders dearly. More details

Non-IDS publication

Lessons from the Recent Economic Crisis: The Australian Household Stimulus Package

International Review of Applied Economics 29.3 (2014)

This paper provides an impact evaluation analysis of the 2009 Australian Household Stimulus Package, which was composed by three main cash payments: the Back to School Bonus, the Single Income Family Bonus and the Tax Bonus for Working Australians. More details

IDS publications on international development research

Making the Poor Pay for Public Goods via Microfinance: Economic and Political Pitfalls in the Case of Water and Sanitation

MPIfG Discussion Paper 11/14 (2014)

This paper critically assesses microfinance’s expansion into the provision of public goods. More details

IDS publications on international development research

Negotiating Exclusions in Developing Country FTAs

Foreign Trade Review 49.4 (2014)

There exists a choice of negotiating the exclusions in tariff liberalisation: negative or positive listing. The extent of coverage caters to all sectors/products minus an identified ‘sensitive list’ under the negative list approach is considered more liberalising than positive listing with coverage across a specific number of sectors/products selected for preferential treatment. More details

Strengthening_Evidence_Based_Policy_2014

Strengthening Evidence-Based Policy: Outputs November 2012 – March 2014

Accountable Grant Outputs Brochure (2014)

Knowledge and evidence are important elements of all policy processes. While the availability of more or higher quality evidence does not guarantee better policy processes, it is difficult to imagine how development policy and outcomes can be improved without it. More details

IDS publications on international development research

Banking on a New World Order

The Economic Times of India (2014)

The establishment of a BRICS bank may see a geopolitical shift from developed countries to developing ones. More details

PB64 Front Cover

Understanding South Africa’s Role in Achieving Regional and Global Development Progress

IDS Policy Briefing 64 (2014)

As Africa’s most diversified, developed and (until recently) largest economy, South Africa occupies a unique position in the international development debate. It is an active player in global governance and development fora, maintains an extensive development partnership with its region, and is a member of the BRICS Forum of emerging powers (along with Brazil, Russia, India and China). More details

Rendite machen und Gutes tun? Mikrokredite und die Folgen neoliberaler Entwicklungspolitik

The first book to collect critical perspectives on microfinance in the German language, this volume brings together researchers, practitioners and journalists for an encompassing assessment of the spread of microfinance and its broader consequences. More details

This is the cover for IDS Working Paper 436, 'An Economics of Wellbeing:
What Would Economics Look Like if it were Focused on Human Wellbeing?'

An Economics of Wellbeing: What Would Economics Look Like if it were Focused on Human Wellbeing?

IDS Working Paper 436 (2014)

This paper makes a number of fundamental proposals to reconsider economics by putting human wellbeing at the centre. More details

IDS publications on international development research

The Shadow Economy in Conflict-Affected Countries

Targeting the shadow economy in conflict-affected contexts is a complex task about which little is known (expert comment). This rapid literature review uncovered little focusing on interventions aimed at incentivising war profiteers to join the legal economy and even less on leveraging the positive social function that shadow economies can provide to conflict-affected populations. More details

Non-IDS publication

How Does Financial Regulation in Low-Income Countries Affect Growth and Financial Stability?

Without effective regulation, financial systems can become unstable, triggering crises that can devastate the real economy. However, there is another side to regulation. The primary purpose of finance is to facilitate productive economic activity. The avoidance of crises creates the foundation for this, but does not guarantee it is done well: financial regulation has a profound effect on the ability of the financial system to perform this function. More details

Non-IDS publication

Sustaining Growth and Structural Transformation in Africa: How Can a Stable and Efficient Financial Sector Help?

This paper draws together a number of essays that emerged from a public debate in Ghana on ‘What does it take to build a stable and efficient financial sector for sustaining growth and structural transformation in Africa?’ More details

IDS publications on international development research

Development Finance Institutions and Infrastructure: Findings from a Systematic Review of Evidence for Development Additionality

GREAT Insights 2.4 (2013)

By leveraging private investment, Development Finance Institutions (DFIs) aim to reduce the infrastructure financing gap in the developing world. This article summarises the findings of a Systematic Review of the evidence on the development impact of DFI support for private participation in infrastructure. More details

Image Teaser for Evidence Report 4, 'What is Business and Development? An Annotated Bibliography'

What is Business and Development? An Annotated Bibliography

IDS Evidence Report 4 (2013)

This annotated bibliography provides an exhaustive collection of resources on the topic of Business and Development. More details

IDS publications on international development research

Mobilising Investment for Inclusive Green Growth in Low-Income Countries

Low income countries (LICs) require very large investments if they are to move to a trajectory of inclusive green growth. The most important sector for inclusive green growth is energy, both in terms of increasing generation from renewable sources, and improving the efficiency with which energy is used. This paper explores how additional private investment can be attracted into the energy sectors of LICs in both these areas at the scale and in the form needed. More details

IDS publications on international development research

Context Matters a Causal Chain Approach to Unpacking Social Accountability Interventions

A common premise of development interventions is that context matters for development outcomes, yet there is little understanding of how exactly 'context' affects outcomes and which contextual factors matter most. More details

this is the image for IDs Rapid response Briefing 3, 'What Next for the BRICS Bank?'.

What Next for the BRICS Bank?

IDS Rapid Response Briefing 3 (2013)

A new development bank to be created by the 'Rising Powers' of Brazil, Russia, India, China and South Africa (BRICS) is intended to promote greater cooperation between developing countries, and address what is seen by many as a history of misguidance and underinvestment by the World Bank and the International Monetary Fund (IMF). More details

IDS publications on international development research

Evidence on the Impact of Tariff Reductions on Employment in Developing Countries: A Systematic Review

Journal of Economic Surveys (2013)

This paper analyses the evidence on the impact of tariff reductions on employment in developing countries. We carry out a systematic review of the existing empirical literature, and include both, ex post econometric evidence and ex ante Computable General Equilibrium (CGE) simulation studies. The synthesis of results suggests that the effects of tariff reductions on employment are country and trade policy specific. More details

IDS publications on international development research

Impact of Displacement on Women and Female-Headed Households: A Mixed Method Analysis with a Microeconomic Touch

Journal of Refugee Studies 26.1 (2013)

This article analyses forced displacement through a gender lens, focusing on the experiences of women and also of female headed households. It uses a set of qualitative as well as quantitative data, covering internally displaced persons (IDPs) in Sampur, Sri Lanka. More details