Tag Archives: economic reform

Celebrating Ronald Coase’s Legacy with Practical Approaches to Economic Reform

Marginal Revolution blogger and George Mason University Professor Tyler Cowen moderates a panel on the future of economic research, featuring Nobel laureate Kenneth Arrow.

Marginal Revolution blogger and George Mason University Professor Tyler Cowen moderates a panel on the future of economic research, featuring Nobel laureate Kenneth Arrow.

Ronald Coase was one of the most influential economists of the 20th century. As important as his theoretical contributions was the simple but profound idea of moving away from “blackboard economics” to look at real-world problems and how institutions actually work. This is an insight that informs our work at CIPE, and which influenced many new ideas and approaches in economics over Coase’s long working life (he published his last book at the age of 101, a year before his death in 2013).

On March 27-28, the Ronald Coase Institute and CIPE honored these contributions with a conference highlighting research and policy in the Coasean tradition, featuring Nobel laureates Kenneth Arrow and Oliver Williamson, distinguished senior scholars and practitioners, and young alumni of the Ronald Coase Institute.

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Successful Public-Private Dialogue: The Kenyan Perspective


“The work of development is too important to be left in the hands of governments alone. It is the responsibility of everyone. Especially the business community.” This was Betty Maina’s main point in her speech last week at the 8th Public-Private Dialogue (PPD) Workshop in Copenhagen, Denmark.

The workshop explored how the government, private sector, and civil society organizations can effectively use PPD platforms for collaborative governance and leadership in addressing difficult challenges. Through its collaborative process, PPD provides a structured, participatory, and inclusive approach to policymaking directed at reforming governance and the business climate.

As the CEO of CIPE partner the Kenya Association of Manufacturers (KAM), Maina spoke on the crucial role that multi-stakeholder PPD platforms can play in building a better enabling environment for business. Maina recognized the social, economic and environmental challenges that we face, and the important role the business community can play in tackling those challenges.

“Instinctively people recognize that [these] challenges demand a new kind of leadership, a new way of doing things,” she said. “Business, like governments, will have to be in the forefront of this change.  No one can do it alone.”

One need to look no farther than Kenya as an example of the private sector’s role in solving societal problems. During the 2007 election crisis, the business community was crucial in supporting peace efforts and dialogue which helped prevent further violence. The business community was also instrumental in supporting the development of Kenya’s new constitution in 2010 and now plays a critical role in its implementation.

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The Gaza Strip Today: The Challenges and Potential

Bahaa Eddin Al-Dahoudi is a CIPE-Atlas Corps Think Tank LINKS Fellow at Project on Middle East Democracy (POMED).


Besides experiencing three destructive wars in less than ten years – Operation Cast Lead, Operation Pillar of Defense, and Operation Protective Edge – the Gaza Strip has suffered since 2007 from two unprecedented major political events that affect both the lives and future aspirations of the Palestinians: the Israeli blockade and internal division.

The Gaza Strip, now in its seventh year under Israeli blockade, remains isolated from the outside world. The blockade affects many fields including education, business, the environment, technology, and culture. What is more, there is the internal Palestinian division which has further exacerbated the situation. The political and social division among the two largest Palestinian factions, Fatah and Hamas, has led to declines in many areas.

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Trade Capacity Building and Private Sector Engagement


By Kirby Bryan

For sustainable economic growth, developing countries must have the capacity to functionally interact with the global market. Much of the onus for building that capacity rests on a domestic commitment to reforms compatible with global trade. Many emerging markets have lofty aspirations that are unachievable given the current state of affairs, but are determined to rectify the situation. Access to foreign markets can cement reform efforts aimed at improving the local economy and sustaining economic growth.

In late February, the Center for Strategic International Studies (CSIS) released a report from their Congressional Task Force on Trade Capacity Building (TCB) on “Opportunities in Strengthening Trade Assistance.” While the report focuses primarily on US efforts to improve the effectiveness and relevance of its TCB programs, it signals a shift in international engagement and understanding of the role trade plays on the growth of a developing economy.

The shift is also indicative of a growing global development trend toward incorporating the voice of the recipient country from the beginning stages of negotiations through agreement ratification. What is interesting about the current TCB discussions is the recognition by major players in the development world of including the knowledge and expertise of the private sector. Ultimately, it is the private sector in the developing and developed countries that will bear the fruits of economic growth and trade.

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Building a Network of Change-Makers in South Asia

South Asia regional economic network members

In late January, CIPE held its sixth in a series of capacity building and networking workshops in Colombo for its South Asia regional network of women’s business associations, which includes organizations from Pakistan, Bangladesh, Nepal, Sri Lanka and India. When CIPE began to work with this group of women business leaders two years ago, the sessions focused primarily on issues such as board governance, strategic planning, staff and financial management, membership development, and services for members.

But between training modules, discussion often turned to the challenges facing women entrepreneurs in their countries, including policy barriers that tend to create a business environment unfriendly to women. Thus, CIPE always knew that eventually, the focus of the program must turn to advocacy for policy reform.

As a result, CIPE increasingly began to raise issues of policy – and policy advocacy – in the context of the training sessions. Then, last summer, CIPE awarded four women’s associations in three countries small grants by CIPE to carry out pilot, four-month advocacy projects.

One point that had frequently arisen in the training program was a lack of understanding of the complexities of policy advocacy, such as: identifying issues of concern to members; developing concrete policy proposals and specific recommendations to tackle those issues; the hard work involved in reaching out to policymakers; the need to broadly engage the media, association members, and the general public; and the need to track results and assess the impact of advocacy initiatives.

Moreover, the countries where the advocacy initiatives took place – Pakistan, Sri Lanka, and Nepal – are challenging environments. During the four months that these organizations were implementing their small grants, each country faced political turbulence that may have shaken the resolve of less dedicated change-makers.

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Holding Pakistan’s Government Accountable on Tax Reform

Pakistan collects far less tax (as a percentage of GDP) than most countries. (Chart: Dawn)

Pakistan collects far less tax (as a percentage of GDP) than most countries. So far the PML(N) government has not been able to significantly increase the tax ratio. (Chart: Dawn)

The Pakistan Muslim League (Nawaz) (PML (N)) government is completing its second year in power on May 11, 2015. It is astonishing to observe that the accountability process for democratically elected government has improved significantly.

Under a CIPE grant, the first such public accountability process was initiated by Policy Research Institute for Market Economy (PRIME), an independent think tank based in Islamabad. PRIME started a simple exercise by taking concrete promises from PMLN’s economic platform and, through a scientifically designed scoring process, monitoring the government’s performance under three key sections: Economic Revival, Energy Security, and Social Protection. These sections were further divided into 82 sub-categories.

The report is widely accepted as an unbiased measure of the government’s performance. The report received significant coverage in local media, both print and television. PRIME Executive Director Ali Salman suggests that “IMF Staff Mission assessment of Pakistan’s economic situation and reforms have many agreements with PRIME’s Tracking Report.”

The accountability process has recently moved to the next level, as the government’s Standing Committee on Finance publically accused the PML (N) government of making decisions on taxation measures in isolation, without taking the Standing Committee in confidence.

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An Unsustainable Future for Algerian Fuel Subsidies?


Photo: Wikimedia Commons


precipitous fall in oil prices in the last seven months has led many oil-producing nations to reconsider their incredibly costly fuel subsidies, which drain government budgets and distort the economy. Yet Algeria, which relies on oil for most  of its government revenue, has taken a different path: freezing public-sector hiring and investment while keeping its subsidies in place – a decision which may only increase its dependence on oil exports in the future.

On Christmas Eve of 2014, Algerian Prime Minister Abdelmalek Sellal announced that, in response to the drop in oil revenue and impending economic crisis, the administration would freeze public sector hiring and new state investment projects. However, the Prime Minister and other officials have insisted that, for the moment, fuel subsidies will remain in place, keeping domestic fuel prices at some of the lowest levels on the African continent – 25 cents per liter, or about 95 cents per gallon.

“The administration is making decisions based on the outlook of the global oil market and on Algeria’s middle- and long-term capacity to support an economy fueled by hydrocarbons,” said Slim Othmani, President of CIPE partner Cercle d’Action et de Réflexion autour de l’Entreprise (CARE), in a recent interview.

In other words, this approach will only deepen the country’s dependence on oil and gas revenues. Not only is this a gamble, it also misses an ideal political moment to recalibrate the fuel subsidies. The government could use the pressure of outside economic forces to make the argument for internal change, and the natural consequences of dropping oil prices could bring home the reasons for reform. Plus, cutting subsidies when fuel is cheap will make the process less painful to consumers.

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