World Bank Staff Research Articles

Incentivizing Responses in International Organization Elite Surveys: Evidence from the World Bank

Abstract Scholars of International Organizations (IOs) increasingly use elite surveys to study the preferences and decisions of policymakers. When designing these surveys, one central concern is low statistical power, because respondents are typically recruited from a small and inaccessible population. However, much of what we know about how to incentivize elites to participate in surveys is based on anecdotal reflections, rather than systematic evidence on which incentives work best. In this article, we study the efficacy of three incentives in a preregistered experiment with World Bank staff. These incentives were the chance to win an Amazon voucher, a donation made to a relevant charity, and a promise to provide a detailed report on the findings. We find that no incentive outperformed the control group, and the monetary incentive decreased the number of respondents on average by one-third compared to the control group (from around 8% to around 5%).

Bank Stress Testing of Physical Risks under Climate Change Macro Scenarios: Typhoon Risks to the Philippines

Bank stress tests of climate change risks are relatively new, but are rapidly proliferating. The IMF and World Bank staff collaborated to develop an experimental macro scenario stress testing approach to examine physical risks for banks by building a dynamic stochastic general equilibrium model linked to global climate and a catastrophe risk model specifically for the Philippines. Our model shows that the impact of extremely rare typhoons on GDP could already be systemic and worsen substantially with climate change. However, bank capital declines only modestly unless the event is compounded with other disasters, partly thanks to the strength of Philippines’ banks and economy before the COVID crisis. However, more work is needed before drawing strong conclusions about the relevance of climate risk, as the model focused only on typhoons’ physical capital destructions and their macroeconomic-level transmissions to banks.

Divided loyalties? The role of national IO staff in aid‐funded procurement

AbstractMany operational International Organizations (IOs) rely on national staff when implementing projects in member states. However, fears persist that the loyalties of national IO staff may be divided when working in their home countries. The article studies differences in more than 50,000 procurement decisions taken in 1729 projects overseen by World Bank staff working as expatriates or in their home countries. The empirical results show that when staff work in their home countries, national suppliers' probability of winning procurement contracts increases. However, these increases are not driven by restricted procurement processes—that exclude competition—which are often seen as red flags for corruption. Instead, restricted procurement processes seem to be less likely when staff work in their home countries. These findings imply that national IO staff use their country‐specific knowledge to increase the development effectiveness of procurement in line with the mandate of the World Bank.

The Political Prohibition Clause of the World Bank Charter and the Legal Implications for the Fight against Corruption in Africa

Article 4(10) of the World Bank Articles of Agreements (hereafter referred the World Bank Charter) adopted in 1944 prohibits World Bank staff from taking political factors into account in their operations and loans decisions for projects of development. Article 4(10) has been at the heart of a sound debate that is reviewed in this paper in relation to human rights and corruption. The discussion is a step further of the colloquium referred as the “Justice and Development Week” organised in November 2010 by the World Bank Legal Vice Presidency Law held in Washington- USA. The purpose of that international meeting was to examine the political prohibition clause in International Development Finance. One of the issues raised during the seminar was the interpretation of the World Bank Charter particularly its Article 4(10).This article discusses the matter and focuses mainly on major issues of the political clause: First, the historical reasons of the insertion of the political prohibition clause in the World Bank Charter and the arguments in support of as well as in opposition to such a restrictive approach by the Bank to engaging with corruption and human rights issues. Second, an analytical discussion of the Bank’s economic perspective and exclusive definition to corruption followed by the legal discrepancies of such a regime of sanctions in comparison with those set by UN and AU anti-corruption conventions.

Managing performance and winning trust: how World Bank staff shape recipient performance

World Bank evaluations show that recipient performance varies substantially between different projects. Extant research has focused on country-level variables when explaining these variations. This article goes beyond country-level explanations and highlights the role of World Bank staff. We extend established arguments in the literature on compliance with the demands of International Organizations (IOs) and hypothesize that IO staff can shape recipient performance in three ways. First, recipient performance may be influenced by the quality of IO staff monitoring and supervision. Second, the leniency and stringency with which IO staff apply the aid agreement could improve recipient performance. Third, recipient performance may depend on whether IO staff can identify and mobilize supportive interlocutors through their networks in the recipient country. We test these arguments by linking a novel database on the tenure of World Bank task team leaders to projects evaluated between 1986 and 2020. The findings are consistent with the expectation that World Bank staff play an important role, but only in investment projects. There is substantial evidence that World Bank staff supervisory ability and country experience are linked to recipient performance in those projects. Less consistent evidence indicates that leniency could matter. These findings imply that World Bank staff play an important role in facilitating implementation of investment projects.

Information, power, and location: World Bank staff decentralization and aid project success

AbstractUsing data on World Bank staff identity and field placement, this article examines the relationship between staff presence in recipient countries and aid project performance. I find that merely placing World Bank staff in developing countries has little effect on the success of development projects. Greater field decision rights are, however, associated with differential project performance. In the most fragile states, the presence of senior personnel (World Bank Country Directors) is associated with greater project success after the “Strategic Compact” increased Country Directors' power. However—consistent with a bargaining model in which greater World Bank authority is in tension with recipient country direction of projects—as countries become less fragile, the net effect of the presence of Country Directors becomes negative. The impact of World Bank staff decentralization is mixed and appears to be driven primarily by the power of senior personnel in the field, not the ability of field staff to gather local information.

Pleasing the Principal: U.S. Influence in World Bank Policymaking

AbstractHow do policies in international organizations reflect the preferences of powerful institutional stakeholders? Using an underutilized data set on the conditions associated with World Bank loans, we find that borrower countries that vote with the United States at the United Nations are required to enact fewer domestic policy reforms, and on fewer and softer issue areas. Though U.S. preferences permeate World Bank decision making, we do not find evidence that borrower countries trade favors in exchange for active U.S. intervention on their behalf. Instead, we propose that U.S. influence operates indirectly when World Bank staff—consciously or unconsciously—design programs that are compatible with U.S. preferences. Our study provides novel evidence of World Bank conditionality and shows that politicized policies can result even from autonomous bureaucracies.

Ideas, Institutions and the World Bank: The Social Protection and Fragile States Agendas

AbstractIdeas and institutions are frequently used as explanatory concepts regarding policy development and change. There is an on‐going debate as to the explanatory weight that each should be afforded; Weiss and Carayannis (2001) identify a spectrum of opinions, with ‘institutionalist' approaches that embed ideas within institutionalist frameworks at one end, and ‘constructivist' approaches which argue that ideational concepts should be dis‐embedded from institutional considerations at the other. Drawing on 43 interviews with senior World Bank staff and a documentary analysis, this paper traces two policy agendas – social protection and fragile states – to identify the institutional and ideational features of the World Bank that a developmental agenda must navigate to achieve prominence in the Bank's work. It finds that the success of a policy agenda is determined by whether the ideas fit with a macro‐ideational dominant paradigm, and identifies several institutional features such as the incentive structure and lending mechanisms that influence an agenda's success.

World Bank technical assistance: participation, policy movement, and sympathetic interlocutors

ABSTRACT This article demonstrates that World Bank internal learning has led to significant changes in how the development bank interacts with government officials through technical assistance (TA). Reviewing evidence of institutional learning and associated changes in practice, the article identifies two main pillars of World Bank TA: TA components (advisory services contained within lending operations) and stand-alone TA projects (loans that solely finance TA). Bringing together the policy transfer and policy mobility literatures and international organisation scholarship on sympathetic interlocutors, the article contends that the nature of interactions between policy provocateur and recipient shapes the recipient's perception of the legitimacy of transferred policy options. Overall, World Bank reviews since the 1980s have repeatedly highlighted the importance of participatory interactions between World Bank staff and country officials to the effective movement of policy. In recent years, practice has begun to catch-up with these operational insights, leading this article to propose a twofold conclusion. First, for the TA provider, participatory TA mechanisms consistently lead to greater domestic support from country officials, leading the provider to more effectively transfer its policy products. Second, for the TA recipient, participatory TA mechanisms can lead to their empowerment and greater inclusion in development project management.

Did the learning agenda of the world bank-administrated health results innovation trust fund shape politicised evidence on performance-based financing? A documentary analysis

The World Bank, co-funded by Norway and the United Kingdom, created and managed an innovative financing mechanism, the Health Results Innovation Trust Fund (HRITF), to support performance-based financing (PBF) reforms in low- and middle-income countries. From its inception in late 2007, until the closing of fundraising in 2017, it has carried out a wide range of activities related to experimenting PBF. In conjunction with the World Bank, which positioned itself as a “learning organisation”, donors have pushed the HRITF towards developing a specific learning agenda for documenting the policy impact of PBF. This learning agenda has been primarily based on impact evaluations of PBF pilot programmes. As a new body took over the HRITF’s portfolio (Global Financial Facility),a documentary analysis of this learning agenda is timely. Building from public policy concepts that have been applied to social and health policy, and knowledge translation literature, we examine the learning agenda implemented by the HRITF over these 10 years. Our data includes documentation and publications (N=35) on HRITF and from the HRITF online platform. Results indicate that on several fronts, the HRITF shaped some form of politicised knowledge, notably in the ways country pilot grants were designed and evaluated. Some of its learning activities also provided opportunities for a transformative use of knowledge for World Bank staff as well as national implementers and policymakers. We also provide reflections about the HRITF’s preferred approaches to produce knowledgeand learn.

‘A More Receptive Crowd than Before’: Explaining the World Bank’s Gender Turn in the 2000s

In the mid-2000s, the gender work of the World Bank took a different turn with a new Gender Action Plan. Up until then, gender equality had been on the margins of the World Bank, concentrated around a small number of advocates. This particular articulation of gender took as its tagline ‘gender equality as smart economics’. The Plan attracted three times the original budget of US$24.5 million, and moved gender analysis into new fields of work: labour, work, land and agriculture rather than the more usual areas of health and education. It emerged at a time when gender work was becoming more legitimate in the field of development economics; where World Bank economists were ‘a more receptive crowd than before’. The mid-2000s was also a time when the World Bank was becoming more conscious of its use of media technologies. The article draws on these two elements—economics and the use of media—to suggest the broader environment against which gender agendas take on meaning. Structural shifts in the field of development economics—the dominant discipline at the World Bank—made work on gender more legitimate and credible, and made World Bank staff ‘a more receptive crowd than before’, while the increasing use of media technologies meant the World Bank was conscious of how its work looked to outside audiences. These elements, only loosely related to what we might think of ‘gender’ as a normative agenda, nonetheless, changed what gender meant to many people working within the World Bank.

An evaluation of the feedback loops in the poverty focus of world bank operations

The World Bank Group in 2013 made the elimination of extreme poverty by 2030 a central institutional focus and purpose. This paper, based on an evaluation conducted by the Independent Evaluation Group of the World Bank Group, examines how, and how well, the Bank uses feedback loops to enhance the poverty focus of its operations. Feedback loops are important for every element of the results chain running from data, to diagnostics, to strategy formulation and finally to strategy implementation. The evaluation uses a range of instruments, including surveys of stakeholders and World Bank staff, focus group meetings, country case studies and systematic reviews of Bank lending and non-lending operations. We find that while the Bank generates useful information on poverty reduction from its projects and programs, the feedback loops – from outcomes to data analysis to diagnostics to strategy formulation and implementation – have generally been weak, with sizable variation across countries.

Strengthening budget institutions in Public Expenditure Management Peer Assisted Learning (PEMPAL) countries

This report is the result of a survey conducted in 2013 and finalised in 2014. The survey was based on self-reporting by 33 OECD and 13 PEMPAL countries and involved the participation of OECD and World Bank staff. This report is organised according to 7 main dimensions of the budget process. These 7 dimensions is addressed in greater detail in sections 2 to 8. JEL codes: H11, H50, H60, H70 Keywords: PEMPAL, Fiscal sustainability, MTEF, capital budgeting, budgeting techniques, performance budgeting, budget transparency, budgetary governance.

Organizational reform and the rise of trust funds: Lessons from the World Bank

Over the past two decades, earmarked funding to international development organizations through special-purpose trust funds has increased greatly. This paper studies the incentives for trust funds from the perspective of multilateral agencies, notably the World Bank. A theoretically intriguing type of funds are so-called “pass-on funds,” in which one unit hosts the fund, then passes on its resources to another type of unit for implementation. Each unit has different preferences for the specific types of activities to be supported by the fund. Interviews with World Bank staff and complementary documents demonstrate the rationale for pass-on funds and the associated division of labor between fundraising network units and implementing regional units. While pass-on funds reflect an efficient division of labor between functionally specialized units, they increase the misalignment between sector-specific global priorities and country-specific needs. Organizational reform drove the sudden explosion of pass-on funds around the millennium turn, facilitated by growing availability of donor monies for specific sectors and by lenient internal regulation. Organizational reform undermined budget autonomy of sector units, causing those units to seek new funds in their areas of expertise. A number of reform features also reduced administrative budgets of country units, increasing their demand for pass-on funding grants. The results contribute to the emerging literature on earmarked funding and highlight the need to consider international organizations as heterogeneous actors.

Pension from World Bank Staff Retirement Plan Tax Exempt in United Kingdom under the United Kingdom-United States Income Tax Treaty (2001)

In this article, the author analyses the recent UK tax case of Michael Macklin (2015) in which the Upper Tribunal held that a pension derived from the World Bank Staff Retirement Plan by a UK resident was exempt from tax in the United Kingdom because that Plan was established in, and generally exempt from income taxation in, the United States for the purposes of the United Kingdom-United States Income Tax Treaty (2001).

The limits of global authority: World Bank benchmarks in Ethiopia and Malawi

AbstractGlobal benchmarks (re)shape political conversations and institutionalise authoritative languages. It does not necessarily follow, however, that benchmarks can exert a lasting or significant influence over policies and behaviour of benchmarked actors. We analyse how the World Bank uses benchmarks to manage its relations with both donors and recipient governments. We analyse the role of the World Bank’s Country Policy and Institutional Assessment (CPIA), both at headquarters and in relation to the recent history of two countries in Africa: Ethiopia and Malawi. We find that the CPIA is not – and contrary to what one would expect from the CPIA’s nominal function and the literature on benchmarks – a very important tool for signalling incentives and allocating funds, or shaping the policy dialogue or the World Bank’s strategy in these two countries. Rather, the CPIA is used highly selectively as one factor among many in the negotiations between World Bank staff and governments. We conclude that the CPIA helps establish the World Bank as an actor that embodies global authority on development issues, including with donors, but that there is a tension between such global authority on the one hand, and concrete authority to shape policy in domestic contexts, on the other.

Safeguards Assessments Policy - External Expert Panel's Advisory Report

This report by the external expert panel (“the panel”) examines the effectiveness and appropriateness of the safeguards assessments policy in the five years since its last review in 2010. In addition to expressing an opinion on the effectiveness and appropriateness of the safeguards assessment policy, the panel also makes recommendations to the Executive Board for its consideration to improve and optimize the benefits to be garnered from the safeguards assessment policy. The panel’s opinion is based on (i) consultations with key stakeholders, including central bank authorities, IMF Executive Directors’ offices, Fund and World Bank staff; (ii) examination of safeguards assessment and other Fund-specific documents; and (iii) study of international reference materials.

Offline: the Kim Doctrine

Jim Kim is one of us. A medical doctor, he has worked in global health most of his professional life. He was co-founder, in 1987, of the innovative Partners in Health initiative. He revitalised WHO's AIDS response from 2004–06. He successfully fused the fields of global health and human rights during a long attachment—1993–2009—at Harvard. And, after a controversial period as President of Dartmouth College, he became President of the World Bank on July 1, 2012. Most of those who work in global health were stunned (and delighted) by his appointment. Many World Bank staff were simply horrified. A non-economist had been appointed to lead an institution whose reputation depends largely on its economic prowess. For many global health advocates, the appointment of Jim Kim was the ultimate example of entryism—the infiltration of a self-proclaimed human rights activist into an institution committed to neoliberalism, a market fundamentalism that has been credited with eroding health systems in dozens of low and middle-income countries. Has the hype lived up to the hope of Kim's appointment?

Staff Guidance Note on the Application of the Joint Bank-Fund Debt Sustainability Framework for Low-Income Countries

Low-income countries (LICs) face significant challenges in meeting their development objectives while at the same time ensuring that their external debt remains sustainable. In April 2005, the Executive Boards of the International Monetary Fund (IMF) and the International Development Association (IDA) endorsed the Debt Sustainability Framework (DSF), a tool developed jointly by IMF and World Bank staff to conduct public and external debt sustainability analysis in low-income countries. The DSF aims to help guide the borrowing decisions of LICs, provide guidance for creditors’ lending and grant allocation decisions, and improve World Bank and IMF assessments and policy advice.

Political ideology, quality at entry and the success of economic reform programs

This study investigates how government ideology matters for the success of World Bank economic policy loans, which typically support market-liberalizing reforms. A simple model predicts that World Bank staff will invest more effort in designing an economic policy loan when faced with a left-wing government. Empirically, estimates from a Heckman selection model show that the quality at entry of an economic policy loan is significantly higher for governments with a left-wing party orientation. This result is robust to changes in the sample, alternative measures of ideology, different estimation techniques and the inclusion of additional control variables. Next, robust findings from estimating a recursive triangular system of equations indicate that leftist governments comply more fully with loan agreements. Results also suggest that World Bank resources are more productive -- in terms of reform success -- in the design of policy operations than in their supervision. Anecdotal evidence from several country cases is consistent with the finding that left-wing governments receive higher quality loans.